The labour regulations which govern the relationship between employer and employee in the UAE free zones vary between each free zone. They must, however, offer the minimum statutory employment rights and obligations that apply to employees working onshore in the UAE, as set out in the UAE Labour Law, Federal Law no.8 of 1980, as amended (the Labour Law).
There are varying degrees of sophistication in the way in which each free zone has drafted its employment regulations. For example, the Dubai International Financial Centre (DIFC) drafted its employment law based broadly on international best practice, whereas the Jebel Ali Free Zone (JAFZ) employment regulations have been drafted to more closely reflect the statutory employment rights set out in the Labour Law.
Generally, the DIFC employment law tends to provide greater protection for employees in comparison to the Labour Law or the JAFZ employment regulations. The Labour Law and JAFZ appear to have been drafted with employer protection in mind. Examples of the greater employee protection afforded under the DIFC employment law are the inclusion of non-discrimination provisions that do not appear in the Labour Law and/or the JAFZ employment regulations, the provision of a more generous maternity leave entitlement in the DIFC as compared to the maternity leave entitlement under the Labour Law and JAFZ employment regulations (i.e. 65 days as compared to 45 days) and the entitlement for employees in the DIFC who have submitted their notice to time off in order to search for new employment before the end of their notice period with their current employer.
The nature and extent of the benefits an employee employed in a free zone enjoys depend on the free zone in which the employee is employed. However, an employee employed in a free zone will, in general, enjoy greater employment benefits than if he/she were employed onshore in the UAE. An example of this is that none of the free zone authorities will apply to the Ministry of Labour for work bans on behalf of employers. This means that the issue of a work ban does not arise when an employee in any such free zone wishes to take up employment with another company, regardless of whether the company is onshore in the UAE or in a free zone. This affords a free zone employee greater flexibility of movement than an employee employed onshore in the UAE.
This article was written by Ali Kamal, paralegal at Norton Rose Fulbright (Middle East) LLP