Can your boss deduct your salary for being late? UAE Labour Law

Are you finding yourself consistently late to work? Whether it is due to lack of sleep, long commutes, or family obligations, being a few minutes late might seem harmless. But, what happens when those late arrivals start piling up and lead to warnings or even salary deductions?

While workplace punctuality is important, it is crucial to understand your rights as an employee in the UAE. Thenji Moyo, partner and head of employment at Gateley LLP, highlights below that disciplinary penalties, such as wage deductions, are tightly regulated. Before accepting any penalties, it is essential to know your rights under UAE Labour Law and the role of company policies.

1. Is it legal to deduct an employee’s salary for being late?

Under Article 39 of Federal Decree-Law No.33/2021 (“UAE Labour Law”), an employer can legally make deductions from an employee’s salary as a disciplinary penalty. However, the amount deducted cannot be more than the total of five day’s salary per month.

Before imposing any penalty, the employer must follow a disciplinary procedure, which includes notifying the employee of the violation, giving them an opportunity to defend themselves, and investigating their defence in accordance with Article 24 of the UAE Labour Law Executive Regulations.

2. If this policy is mentioned in the HR handbook or onboarding agreement, is it legally binding?

In practice, HR Handbooks are not contractual documents unless expressly stated otherwise. However, they act as official guidance by setting out the company rules and procedures that employees must follow. If an employee does not follow the rules in the HR handbook, employers have the authority to take disciplinary action against them in accordance with their disciplinary policy, regardless of whether the handbook is contractual or not.

3. What should Employees in the UAE know about disciplinary penalties?

Employees should know that disciplinary action can be taken against them for failing to follow company regulations. They can face various penalties listed under Article 39 of the UAE Labour Law, including being terminated. In light of this, employees are strongly encouraged to familiarize themselves with their company’s rules and regulations.

However, employees should also know that in accordance with Article 24 of the Implementing Regulations, they have the right to challenge penalties without facing retaliation. Employees can do so by filing an internal grievance, which their employers need to then investigate and notify the employee of the outcome.

4. What should Employers in the UAE know about disciplinary penalties?

Employers should know that they can choose from a range of disciplinary penalties listed under Article 39 of the UAE Labour Law, such as:

• Written Notice.
• Written Warning.
• Suspending the employee from work for up to 14 days.
• Denying the employee their promotion for up to 2 years.
• Terminating the employee.

However, any penalty imposed should be proportionate to the offence. Employers must consider various factors listed under Article 24 of the Implementing Regulations when imposing a penalty, such as:

• What financial impact did the employee’s violation have on the company?
• Has the employee committed the violation in the past?
• Are there any moral considerations that must be considered?

The employer must also notify the employee in writing of the penalty, why it is being imposed, and any further penalties the employee will face if they repeat the violation.