The UAE Government on Friday issued new directives that would lift the two and three-year cap on fixed-term employment contracts in the private sector.
In an update to new labour laws that came into force in February, the Ministry of Human Resources and Emiratisation (Mohre) announced changes to the decree-law on the Regulation of the Employment Relationship, the Khaleej Times reported.
The ministry said that under the new amendments, employment contracts must cover a defined term — however, the law no longer sets a limit on the contract period.
The contract can be renewed and will remain valid as long as both the employer and the employee agree to the stipulated conditions.
Explaining the latest changes, lawyer Ashish Mehta noted that previously, “employment contracts used to be synchronised with the visa status of the employee”. This meant that these contracts were limited to the two and three-year validity of visas.
“However, with the new announcement, the contract could have a much longer duration than the visa status of the applicant,” said Mehta, founder and managing partner of Ashish Mehta and Associates.
The UAE changed its labour laws to introduce flexible working models for the post-coronavirus workplace in November 2021.
Under the new law that came into force on February 2 this year, indefinite contracts should be changed to fixed-term agreements.
It also specified that “a worker can be hired on a fixed-term employment contract for up to three years”, which can be extended or renewed for a similar or shorter duration.
The latest amendment announced on Friday states that employment contracts must cover a specified term — but the law will not set a cap on the term period of the contract.
