The Registration Authority of Abu Dhabi's international financial centre, Abu Dhabi Global Market (ADGM), has released the Employment Regulations 2024. These regulations are intended to reflect global shifts in workplace practices and offer clearer guidance on the rights and obligations of employers and employees. The changes aim to promote and foster best employment practices in ADGM and are set to be implemented on 1 April 2025.
A summary of the key changes and amendments is set out below:
1. Employment Contracts
Written Contracts: Employers must provide written employment contracts within one month of an employee’s start date.
New Criteria: Contracts must specify if the employee is a remote worker, a new concept introduced by the regulations and there is no requirement for work permits or residence visas.
Changes to Contracts: Any changes to employment contracts require written consent from both employer and employee, unless the change is purely administrative (in which case, written notice must still be provided).
Part-time Work: The law explicitly allows part-time employment and clarifies entitlements for part-time workers.
2. Vicarious Liability
Employer Responsibility: Employers may be vicariously liable for acts or omissions by employees if those acts occur in the course of their employment. Employers must demonstrate they’ve taken reasonable steps to prevent misconduct or risk being held liable for employees’ actions.
3. Discrimination and Victimisation
Liability for Discrimination: Employers are liable for acts of discrimination, harassment, or victimisation by employees unless they can prove that they took all reasonable steps to prevent it.
New Protected Categories: The term "sex" is replaced by "gender," and "pregnancy and maternity" are explicitly added. The ground of "colour" is removed.
Victimisation: A new concept of victimisation has been added where an employer punishes an employee for engaging in protected acts such as filing a complaint or providing evidence in support of claims of discrimination, harassment, or victimisation. Employees subjected to victimisation can seek compensation of up to three years' salary.
4. Probationary Period
Duration: The probationary period remains capped at six months, with no entitlement to sick pay or certain family rights and other rights during this time.
Termination during Probation: Employers must provide repatriation flights to terminated employees within 30 days (unless exceptions apply, such as remote employees or those terminated for cause).
5. Working Hours and Leave
Working Hours: The maximum weekly working hours remain at 48 in a seven-day period.
Overtime: Employers must obtain written consent before requiring Employees to work overtime. The law does not specify provisions for overtime pay, though ADGM may issue further guidance.
Ramadan Working Hours: Muslim employees are entitled to 25% reduced working hours during Ramadan.
Bereavement Leave: Employees are entitled to five days of paid bereavement leave for the death of immediate family members
Annual Leave: Employees and can carry forward at least five days of leave for up to 12 months.
Maternity Leave: This leave remains at 65 working days but is extended to include employees adopting children under five years old or who have suffered a stillbirth or miscarriage after the 24th week of pregnancy. Employees working more than six hours a day are entitled to one hour of nursing breaks during the first nine months after childbirth.
6. Termination of Employment
Notice Period: The notice period for termination remains at seven days for employees employed less than three months and 30 days for those employed longer.
Dues on Termination: Employers must pay all dues within 21 days of termination, with penalties for non-compliance. Employees are entitled to receive a written statement of the reasons for their termination within 21 days of the request.
Written Reference: All employees have the right to request a written reference, which the employer must provide within 21 days.
7. End of Service and Settlement Agreements
Gratuity Calculation: The calculation remains unchanged, but the basic salary used for this calculation must now account for at least 50% of the total salary. All employees with more than one year of service are entitled to end-of-service gratuity.
Settlement Agreements: These must be in writing, signed by both parties, and must include a clause confirming that the employee has had an opportunity to seek legal advice before signing.
Conclusion - Employer Compliance and Preventative Measures
Employers should, to the extent required, update policies, procedures, and settlement agreements to comply with the new regulations, ensuring that employees are informed of their rights, particularly in relation to harassment, discrimination, and termination.
Employers should also provide training to managers on identifying and preventing discriminatory or harassing behaviour. Taking preventative measures is a priority under the new regulations.
These regulations provide for minimum employment standards for employees, promote a fair balance of rights and obligations between Employees and Employers and foster employment practices that will contribute to the prosperity of the ADGM.
Employers in the ADGM should review and adjust their contracts and policies to ensure compliance with the new regulations by 1 April 2025. A copy of the new regulations can be accessed here. Have questions about your employment terms? For more insights and personalised advice, reach out to Theresa Abrefa.
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This material is provided for general information only. It should not be relied upon for the provision of or as a substitute for legal or other professional advice.
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