UAE introduces a new rule for WPS - Effective 1 June 2026

Following Ministerial Resolution No. 340 of 2026, this is to inform you about significant updates to the Wage Protection System (WPS) regulations, as issued by the Ministry of Human Resources and Emiratisation (MOHRE) in the United Arab Emirates (UAE). These changes, effective 1 June 2026, aim to enhance wage protection and ensure labour compliance for private sector employees.

Key Changes

Mandatory Salary Payment Date: Starting 1 June 2026, all private sector companies registered with MOHRE must ensure that employee salaries of the current month are transferred before the first day of the following month.

Compliance Criteria: 

• An employer is considered compliant if at least 85% of total wages are paid in line with the due date.
• An employee is considered paid if they receive at least 85% of their entitled salary, as long as the remainder results from any legally documented deductions.

Accelerated Enforcement:

In case of failure to pay employee wages as per the due date, various measures and actions will be carried out as follows:

• Day 5: Possible suspension of new work permits alongside formal violation notifications.
• Day 11: Administrative fines for repeated violations within six months.
• Day 16: Registration of labour disputes for delays and further work permit suspensions, especially for large companies.
• Day 21: Harsher penalties, including enforcement actions such as asset seizures and travel bans. 

Exemptions and Exceptions: The resolution exempts certain categories from WPS compliance, including:

• Workers involved in active disputes
• Workers reported absent from work
• Workers on approved unpaid leave, with relevant notification provided to MOHRE
• Short-term work permits under three months 

What’s next for Employers?

1. Review Payroll Timelines: Adjust payroll cycles to align with new deadlines.
2. Ensure new WPS Integration: Confirm compliance through seamless system integration with financial institutions.
3. Evaluate Outsourcing: Reassess any existing payroll outsourcing agreements.
4. Brief HR and Finance Teams: Educate relevant teams about these regulatory changes.
5. Prepare for Compliance: Strategize necessary modifications to be ready by the 1 June 2026 deadline.