How to hire your first employee in the United Arab Emirates
Reviewed by Mellow Editorial Team, HR & payroll content team
Hiring your first employee in the UAE means registering with the Ministry of Human Resources and Emiratisation (MOHRE), obtaining a work permit and residency visa, setting up a compliant payroll, and enrolling in the Wage Protection System. The process is structured and largely sequential, so understanding the order of steps saves time and avoids penalties.
Before you start: what you need in place
You cannot sponsor an employee until your company has an active trade licence. The licence must be issued by the relevant authority — the Department of Economy and Tourism (DET) for mainland companies, or a free zone authority if your entity is free zone-based. Your licence category determines which roles you are permitted to hire for, so check that the job function you need is covered before you proceed.
Free zone entities can only sponsor employees who will work within that free zone or, in some cases, remotely. If your employee needs to work across the UAE mainland, a mainland entity or a dual-licensing arrangement is typically required.
Step 1: Register with MOHRE and obtain a work permit
Once your trade licence is active, register your company with MOHRE as an employer. This gives you access to the ministry's systems for managing work permits.
For most expatriate hires, the process runs as follows:
1. Apply for a work permit (entry permit). Submit the offer of employment through MOHRE or the relevant free zone authority. MOHRE-registered companies do this through the Tasheel service network or the MOHRE portal.
2. The employee enters the UAE on the entry permit, or you process the permit for someone already in-country on a valid status.
3. Complete the medical fitness test. The employee attends an approved medical centre.
4. Apply for the Emirates ID through the Federal Authority for Identity, Citizenship, Customs and Port Security (ICP).
5. Obtain the residence visa, stamped in the passport. This is tied to your company as the sponsor.
The work permit and residency visa are separate documents but processed in tandem. Typical end-to-end timelines run two to four weeks for straightforward cases, longer if documents require attestation.
For UAE or GCC national hires, the process is lighter because residency is not an issue — but you have additional obligations under Emiratisation rules depending on your company size and sector.
Step 2: Issue a compliant employment contract
Federal Decree-Law No. 33/2021 requires a written employment contract for every employee. MOHRE provides standard contract templates; free zone authorities have their own versions. Key terms that must appear include job title, basic wage, allowances, working hours, and the contract type — fixed-term contracts are the norm under current UAE labour law.
The contract must be in Arabic or bilingual. MOHRE-registered contracts are submitted electronically, which creates a formal record with the ministry. Do not rely on an informal offer letter alone.
Step 3: Enrol in the Wage Protection System
All employers with MOHRE-registered employees must pay salaries through the Wage Protection System (WPS). This means routing salary payments through a bank, exchange house, or card provider that is WPS-connected and submitting a Salary Information File (SIF) each pay cycle.
Payments made outside WPS, or payments that are late, trigger compliance flags that can result in fines and a block on processing new permits. Set up your WPS-connected account before your employee's first pay date.
There is no personal income tax on salaries in the UAE, so no tax withholding is required from employee pay.
Step 4: Understand your ongoing financial obligations
End-of-service gratuity. Expatriate employees accrue gratuity under Federal Decree-Law No. 33/2021. The rate is 21 days' basic wage per year of service for the first five years, and 30 days' per year for each year after that, with total gratuity capped at two years' total basic pay. You are not required to fund this in a separate account today (though a voluntary savings scheme is available), but you should account for it as an accruing liability from day one.
GPSSA contributions. If you hire a UAE or GCC national, they must be enrolled in the General Pension and Social Security Authority (GPSSA) scheme. Both employer and employee make contributions. Expatriates are not part of this scheme.
Annual leave. Employees are entitled to 30 calendar days of paid annual leave after completing one year of service. During the first year, leave accrues pro rata.
Step 5: Keep your records current
MOHRE and ICP both require timely renewals. Residence visas and Emirates IDs are issued for a fixed period and must be renewed before expiry. Letting a visa lapse puts both the employee and the company in violation. Build renewal reminders into your HR calendar well ahead of expiry dates.
Maintain a signed copy of the employment contract, copies of ID documents, and records of all WPS salary transfers. These are the documents you will need in the event of an inspection or a labour dispute.
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