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During this time of uncertainty, employers and employees are navigating unchartered territory with employees working from home, uncertainty as to business prospects and lack of clarity as to how long the current circumstances will last.

When considering restructuring, employers are also having to navigate new measures which are being enacted by governments as a result of Covid-19.  These regulatory measures impact on decision making for employers and can be wide ranging from restrictions on terminations to salary support schemes.

On 26th March, the UAE's Ministry of Human Resources & Emiratisation (Ministry) issued Ministerial Resolution 279 of 2020 on Employment Stability in the Private Sector during the Period of the Application of Precautionary Measures to Curb the Spread of Covid-19 (Resolution).  The Resolution has immediate effect and will stay in force during the period that the precautionary procedures combatting the spread of Covid-19 are in place. 

The Resolution applies to the employment of expatriates (ie non UAE nationals) by employers registered with the Ministry. It should be noted that at the current time, employees cannot be recruited from overseas thereby restricting recruitment to those individuals who are in the UAE.

The Resolution provides that companies affected by the precautionary measures and wishing to re-organise, can take a range of escalating measures in agreement with the employee. These measures include:

  • remote working;
  • paid leave;
  • unpaid leave;
  • temporarily decreasing employees' salaries;
  • permanently decreasing employee's salaries. 

The Resolution also provides for a virtual job market whereby those employers, which are affected by the precautionary measures and want to reduce their workforce, can register employee's details with the aim of the finding alternative employment for the employee elsewhere in the UAE. However, the employer must honour its obligations towards the employee in relation to accommodation and other contractual entitlements (other than salary) until the employee leaves the country or has been authorised to transfer to a new employer.

Employers wishing to employ non-nationals, during the period in which there are restrictions in place regarding employing individuals from overseas, must do the following:

  1. Market its vacancies in the virtual job market; and;
  2. Use the internal work permit procedure of the Ministry of the Interior through their electronic and smart applications (work permit transferring the worker to the new company, temporary work permit, limited time period work permit).

The Resolution also sets out the Ministry's procedures which employers must follow if the employees' employment terms are being changed either permanently or temporarily.

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