Understanding Amendments to Abu Dhabi Employment Regulations

The Abu Dhabi Global Market (ADGM) has introduced key amendments to its Employment Regulations, aimed at enhancing clarity and fairness in workplace practices. These changes address crucial aspects in today’s market, such as remote work and compliance requirements, aligning ADGM’s framework with international standards. The updated regulations reflect ADGM’s commitment to fostering a competitive and transparent business environment for employers and employees alike.

Introduction

The ADGM Registration Authority has introduced the Employment Regulations 2024 (“New Employment Regulations”), which will replace the existing regulations and take effect on April 1. These updates incorporate additional amendments beyond those proposed in the July 2024 consultation paper, reflecting global trends in workplace practices and aiming to provide greater clarity on the rights and obligations of employers and employees.

The changes include increased fines and liabilities, necessitating that employers review and update their internal policies, employment contracts, and HR practices to ensure compliance.

Key Updates

1. Expanded Definitions

• Employee: The definition has been broadened to include remote employees, facilitating flexible and remote work arrangements.

2. Employment Contracts

• Written employment contracts must be issued within one month of employment commencement.
• Nonadministrative amendments require mutual written agreement.

3. Probationary Period

• Limited to a maximum of six months or, for fixed-term contracts lasting six months or less, capped at half the contract’s duration.
• Employees may take annual leave during probation with employer approval and are entitled to unpaid sick leave.
• Repatriation flights must be provided if the employee is terminated during probation.

4. New Worker Categories

• Remote employees: Defined as those working outside ADGM premises, either within or outside the United Arab Emirates (UAE). Remote employees outside the UAE do not require UAE residence visas or ADGM work permits.
• Part-time employees: Defined as employees working fewer than eight hours per day or five days per week. Leave and benefits are calculated proportionally.

5. Immigration Rules

• Employers must cancel residence visas and work permits promptly upon employee termination to avoid fines.
• Visa cancellations cannot be contingent on employees waiving their rights.

6. Work Hours

• Limited to 48 hours per week unless written consent is provided for additional hours.
• Muslim employees are entitled to a 25% reduction in work hours during Ramadan without pay deductions.

7. Leave Entitlements

Parental Leave:

• Fathers are entitled to five working days of paid leave within two months of a child’s birth or adoption.
• Maternity leave now extends to adoptive mothers and women experiencing stillbirth or miscarriage after 24 weeks.
• Full-time employees who are nursing mothers are entitled to a one-hour daily nursing break for up to nine months following the date of childbirth.

Annual Leave:

• Up to five days of unused leave may be carried forward but must be used within the following year.
• Employers must provide seven calendar days’ prior notice for mandatory leave.

Bereavement Leave:

• Five working days of paid leave for the death of a parent, spouse, sibling, or child.

8. Employee Obligations

Employees must:

• Act faithfully and avoid bribery or corruption.
• Follow lawful employer instructions.
• Maintain confidentiality.

9. Discrimination and Whistleblowing

• Pregnancy and maternity are now protected characteristics.
• Remedies for discrimination and victimization include compensation of up to three years’ wages respectively.
• Protections are introduced for whistleblowers making protected disclosures.

10. Termination and End of Service Gratuity (ESG)

Notice Period:

• Minimum notice of seven days for employees with less than three months of service.
• Minimum notice of 30 days for employees with more than three months of service.
• Employers cannot pay in lieu of notice without employee written consent.
• Employers are required to pay all wages and any other amounts owed to an employee upon termination of employment, excluding variable payments, within 21 calendar days from the termination date.
• ESG is now preserved and payable upon termination, regardless of the reason.
• Employers may offer alternative pension or savings plans.

11. Repatriation Flights

Employers must provide repatriation flights unless: 1) The employee is a remote worker outside the UAE, or 2) the employee secures alternative employment or sponsorship within 30 days.

12. Settlement Agreements

Employees can still waive their rights through settlement agreements; however, specific criteria must now be met, including the requirement for independent legal advice.

13. Sanctions and Procedural Requirements

The New Employment Regulations outline the registrar’s powers to impose sanctions, refer matters to the ADGM Courts, and issue procedural guidelines.

Conclusion

The new regulations introduce significant changes, reflecting modern workplace practices and enhancing clarity for employers and employees. Employers should act promptly to review and update their policies, employment contracts, and compliance frameworks to align with these amendments.

Next Steps

Employers will need to:

• Ensure their internal policies are aligned with the new amendments.
• Review and amend employment contracts if required.
• Consult legal counsel to address any uncertainties and implement changes smoothly.

Rachel Hill is an attorney with Addleshaw Goddard LLP in the UAE and Saudi Arabia. © 2025 Addleshaw Goddard LLP. All rights reserved. Reposted with permission of Lexology.