UAE Labour ministry reduced employment fee for companies

Employment fee for facilities under Category A has been reduced from Dh11,000 to Dh300 a year. Transfer fee for companies under Category B, which earlier paid Dh11,500 for three years has been reduced to Dh1,500 for two years. Firms under Category C, which shelled out Dh12,000 now need to pay just Dh2,000 for two years.

The ministry cancelled all fees for employment of nationals in the private sector to boost emiratisation. Similarly, fees for recruitment of GCC nationals have also been lifted.

The ministry stressed the need for all workers to have a valid labour card and valid residency visa with the relevant signatures of the authorities. Even those unregistered until now, including government workers, students, children below 18 years, and spouses of citizens

UAE retirement age increased from 60 to 65

New norm part of the labour rules revision to help expatriates who otherwise retire at 60

Expatriates in the UAE have been given an additional five years of service with the Ministry of Labour revising the retirement age from 60 to 65.

Part of the widespread changes in the country's labour law will allow expats to secure visas up to the age of 65 years, Arabian Business reported quoting an unnamed official of the ministry.

“The retirement age before was 60, now it’s 65. They raised the retirement age [under the new legislation,” the official told the website.

The ministry had last week announced the decision to reduce the validity of labour cards to two years from three, starting from January 1, 2011. This practically gives expat workers the freedom to switch jobs without a no-ojection certificate (NoC) from the employer.

The previous law had ensured workers get a six-month ban forcing them to leave the country if their employers refuse the NoC.

MoHRE’s New Business Classification: Incentives and Penalties in 2025

The Ministry of Human Resources and Emiratisation (MoHRE) has implemented a modern, three-tiered classification system for private sector establishments, replacing all previous models (including the 2010 structure). Effective since June 2022, this system directly ties a company's regulatory compliance, commitment to national talent, and workforce diversity to the cost and ease of accessing MoHRE services.

Governed primarily by Cabinet Resolution No. 18 of 2022, the goal is to enhance market growth, attract high-skilled talent, and enforce strict adherence to the new Federal Decree-Law No. 33 of 2021 (the UAE Labour Law).

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🥇 The Three-Tier Classification System

Companies are automatically placed into one of the three categories based on an automated system that monitors real-time compliance data. The category determines the work permit and transfer fees charged by MoHRE.

Category	Compliance Status	Work Permit Fee (Approx. for 2 Years)	Key Criteria & Benefits
Tier 1 (First)	Highest Compliance	$\text{AED }250$ (Max reduction of 80%)	Exceeds Emiratisation targets by 300%; is an innovative SME; cooperates with Nafis by hiring/training $\ge 500$ citizens annually.
Tier 2 (Second)	Default/Standard Compliance	$\text{AED }1,200$ (Standard fee)	Complies fully with the Labour Law, WPS, worker protection, and cultural/demographic diversity policy. All new and generally compliant firms fall here.
Tier 3 (Third)	Non-Compliant/Violator	$\text{AED }3,450$ (Highest fee)	Violates the Labour Law, cultural diversity policy, or commits serious breaches (e.g., failure to pay WPS, providing false data, human trafficking).

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🎯 Mandatory Compliance for Tier 2 and Tier 1 Status

To avoid being downgraded to the costly Tier 3, all establishments must adhere to the foundational compliance standards:

1. Zero-Tolerance for Law Violation

Companies must be 100% compliant with Federal Decree-Law No. 33 of 2021, its Executive Regulations, and all ministerial decisions. Violations can lead directly to Tier 3 classification.

2. Wage Protection System (WPS)

Full and timely payment of wages through the WPS is mandatory. Any failure to adhere to the WPS regulations is a major factor in being downgraded.

3. Cultural & Demographic Diversity Policy

Companies must adhere to the policy that promotes cultural and demographic diversity in the workforce. This is a core requirement for both Tier 1 and Tier 2 status.

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🏆 Achieving Tier 1: The Incentive-Driven Model

Tier 1 is not the default; it must be earned by meeting the fundamental requirements of Tier 2 PLUS fulfilling at least one of the following premium criteria:

• Exceeding Emiratisation Targets: Raising the annual Emiratisation rate to at least three times the targeted rate set by the Cabinet (currently $2\%$ increase per year for companies with 50+ employees).

• Nafis Cooperation: Actively cooperating with the Nafis program by hiring and training a high volume ($\ge 500$) of Emirati citizens annually.

• SME Status: Being categorized as a Small and Medium-sized Enterprise (SME) owned by a young Emirati citizen or being a project of an innovative nature.

• Strategic Sector: Belonging to a targeted economic activity or sector determined by the Council of Ministers.

📉 Financial Impact of Classification

The fee difference highlights the financial incentive for compliance. For a work permit issued or renewed for two years, a Tier 1 company pays a minimal amount (up to $\text{AED }250$), while a Tier 3 company pays a fine-level fee (up to $\text{AED }3,450$).

The new classification system has effectively created a performance-based market where excellent corporate behavior is rewarded with significantly lower operational costs and streamlined government services, while non-compliance results in heavy financial penalties.

The Ministry of Labour UAE announced minimum wage limit for different categories of workers

The Ministry of Labour on Saturday announced a minimum wage limit for different categories of workers, depending on their qualifications.According to new labour laws, employees under skilled class level 1 (those with a Bachelor's degree) should earn a minimum Dh12,000 a month.Diploma holders, who come under skilled class level II, should earn not less than Dh7,000 and workers who have passed high school should be paid a minimum salary of Dh5,000.

The ministry urged strict implementation of Wage Protection System (WPS) and called on companies to adhere to the salary structure according to the amended classification.With a focus on emiratisation, the ministry has amended a few labour laws that stipulate establishments hire employees under three categories.

According to the new amendment, nationals should not be less than 15 per cent of the total staff of any company.

Similarly, the skilled class (inclusive of three levels) should not be less than 20 per cent of the total employee strength of any company.The ministry has also classified establishments according to the type of employees they hire.

Depending on the percentage of diversity among staff, companies now fall under three categories (first and second and third), and category II includes three levels (a, b and c).

A facility will fall under level (a) if the diversity among employees is at least 25 per cent; under level (b) if diversity among workers is between 25-50 per cent; and under level (c) if the diversity is 50 per cent or more.

A company can be upgraded to second level irrespective of the diversity provided the skilled class is not less than 20 per cent of total workforce. Similarly, companies can be downgraded if they violate labour laws, clarified Labour Ministry.

Canadians to stay outside the country for one month for new UAE visit visa

Canadians need to stay outside the country for one month before they can apply for new visit visas in a stipulation similar to one set out for people of certain nationalities who are required to have a visa in advance to enter the UAE, official said yesterday.

Officials said the same visa rules that are applied to people of certain other nationalities who are required to be in possession of a visa before entering the UAE will apply to Canadians as well.An official from the Ministry of Interior said that the new rules will take effect from January 2.

Canadians who hold regular passports and intend to travel to the UAE need to apply for visa in advance for visit, tourism and business purposes, the official said.

The official added that Canadians seeking to enter the UAE on a visit visa could get their papers processed through a sponsor who could either be a person or a company.

Transit visa

The official said that those Canadians going to the UAE as tourists could apply for tourist visas through hotels or travel agencies in the UAE.He said the same rules that were applicable to people of nationalities requiring an advance visa to enter the UAE would henceforth apply to Canadians, who were earlier exempted from visa rules.

Canadians transiting through the UAE will be able to obtain a transit visa at the airport upon presentation of travel documents indicating that they will leave the UAE within 96 hours to their onward destination, the official said.

"In the past a Canadian with regular passport could enter the UAE after obtaining visa upon arrival. Now the rules have changed," he added.

The UAE Embassy noted that a "short-term visa" will cost C$250 and would be valid for 30 days, a long-term visa for three months would cost C$500 and a six-month multiple-entry visa will set travelers back C$1,000.

He added that Canadians with diplomatic and special passports are required to obtain their UAE visa from the UAE Embassy in Canada before their travel.The official said Canadians visiting the UAE would also have to ensure that their passports were valid for at least six months beyond the date of entry into the country.