The Abu Dhabi Global Market (ADGM) has updated ADGM Employment Regulations 2024 (the “New Employment Regulations”), which bring forward significant improvements that align with global best practices, offering benefits to both employers and employees. With a focus on clarity, flexibility, and fairness, these regulations create a more balanced and progressive work environment. For businesses, the changes offer the opportunity to refine employment policies, enhance employee relations, and ensure compliance with modern workplace standards. As the regulations come into effect on 1st April 2025, employers have a valuable window of time to implement the necessary adjustments, positioning themselves for a smoother, more compliant future while fostering a supportive workplace culture.
Let’s dive into the key insights of updated ADGM Employment Regulations that will shape the future of employment in ADGM.
1. Introduction of Flexible Employment Models
One of the significant updates in the ADGM employment regulations is the introduction of more flexible working arrangements. Employers will now be able to hire remote employees, and the definition of an “employee” has been expanded to accommodate this shift. This change provides more room for businesses to operate in a global landscape, allowing them to hire talent from outside the UAE without needing a local residence visa or work permit, as long as the employee doesn’t reside in the UAE.
2. Enhanced Employee Rights and Clarifications
The updated ADGM employment regulations provide greater clarity on employee entitlements, particularly for part-time employees. These changes aim to ensure that part-time workers are given their fair share of benefits, including leave entitlements. Employers will need to adjust their records and contracts to account for these nuances, ensuring that all employees, regardless of hours worked, are treated fairly and consistently.
3. Probationary Period Updates
The probationary period remains capped at six months, but the regulations now specify that employees during this period are entitled to sick leave, though not sick pay. During probation, certain provisions of the regulations do not apply, and the employee must have written approval from the employer to take annual leave. These updates provide greater transparency for both employers and employees regarding their rights during this trial period.
4. Parental Leave and Family Rights
The regulations extend important parental rights, including maternity leave of 65 working days, and now include provisions for employees who adopt children under the age of five. Maternity leave also extends to cases where a stillbirth or miscarriage occurs after the 24th week of pregnancy. Paternity leave remains at five working days. These updates ensure that employees receive the necessary support during significant life events.
5. Anti-Discrimination and Anti-Victimisation Provisions
The updated ADGM employment regulations place a greater emphasis on protecting employees from discrimination and victimisation in the workplace. Victimisation, as defined in the regulations, includes actions like dismissal or other detrimental treatment following an employee’s participation in protected acts, such as whistleblowing or filing a complaint regarding discrimination or harassment. Employers must take proactive steps to prevent such behaviour and must provide employees with a safe space to report wrongdoing.
6. Whistleblower Protection
The new regulations strengthen whistleblower protections by ensuring that employees who make protected disclosures are not subject to retaliation. Employers are prohibited from retaliating against employees who report violations of law, including harassment, discrimination, or health and safety concerns. If retaliation occurs, the employee can seek compensation and a court remedy.
7. Working Hours and Overtime
The maximum weekly working hours remain set at 48, but employees must provide written consent to work overtime. The law also stipulates a 25% reduction in working hours during Ramadan for Muslim employees, with no reduction in pay. While there are currently no specific provisions for overtime pay, the ADGM may issue further guidelines in the future.
8. Termination and End of Service Gratuity
The updated ADGM Employment Regulations introduce detailed provisions around the termination of employment. Employers will need to provide employees with written reasons for termination, and the notice period remains the same as under the old law. Notably, end-of-service gratuity is now payable in all cases where the employee has more than one year of service, even if the termination is for cause. Employers will also need to offer repatriation flights to eligible employees who are terminated, unless the employee is dismissed for cause.
9. Settlement Agreements
Settlement agreements, which are used when terminating an employment relationship, continue to be recognized under the new regulations. However, for a settlement agreement to be valid, it must include a clause that the employee has had the opportunity to receive independent legal advice. Additionally, the employer cannot make the cancellation of the employee’s visa conditional on waiving any rights according to the updated ADGM Employment Regulations.
10. Vicarious Liability for Employers
Employers will be held vicariously liable for the actions of their employees if these actions breach the new employment regulations, provided the act occurred during the course of employment. This means employers must be diligent in creating clear policies and training programs that prevent misconduct, including discrimination, harassment, and victimisation, to mitigate the risk of legal liabilities.
11. Remote and Part-Time Employees
The concept of “remote employees” and “part-time employees” is now formalized in the updated ADGM Employment Regulations. Remote employees, who work outside the UAE, will be subject to different rights and obligations, and their work arrangements will not require a UAE residence visa or ADGM work permit. Meanwhile, part-time employees will benefit from clearer guidelines around leave entitlements and other employment benefits, making it easier for employers to manage such employees.
Updated ADGM Employment Regulations 2024: A New Era of Workplace Flexibility and Fairness
The updated ADGM Employment Regulations 2024 usher in a new era of workplace fairness, flexibility, and compliance that benefit both employers and employees. Employers have the opportunity to refine their policies, adapt to modern workplace trends, and ensure they meet legal requirements before the regulations take effect in April 2025. These changes not only enhance employee satisfaction and support but also offer businesses a chance to stay ahead of the curve in a competitive and evolving market. It’s an exciting time for companies in ADGM to prepare for a future where fairness and flexibility are at the forefront of work experience.