The United Arab Emirates is the most attractive destination for business professionals and expats because of its low cost of living and high lifestyle, no personal taxes, and lower income tax rates. The UAE has the world’s most rapidly growing economy and offers extensive growth and development for various industries and trade sectors. The employers hire millions of employees and workers in the UAE from around the globe to relocate, stay, and work. The Emirates has a recognized labor law and WPS UAE or wage protection system for employees’ or workers’ rights.
In this guide, we share all the information and relevant details about the wage protection system according to the UAE laws and regulations. You will learn the WPS rules in UAE, perks and benefits, and how to comply with these rules to avoid inconvenience.
What is WPS in UAE?
The WPS is an essential law to regulate basic wage in UAE for distribution and avoid disputes among employers and employees to ensure fair and timely wage distribution to comply with the laws of the Emirates.
The regulated authorities manage the WPS UAE salary database, and employers must input all the information regarding the wages and salaries of their employees and workers to validate it from the bank and comply with the laws of the state. The employees and workers are protected and safe from any illegal activities, such as inappropriate wages, use of illegal funds and resources, delays, or disputes regarding wages from employers. Any of these unfair practices from the employer can be obliged by the law of the state and break the employment contract due to these unlawful practices.
How Does WPS Work?
The UAE government ensures fair wage distribution, appropriate wages, and timely disbursement to employees and workers in the Emirates. The UAE government changed the rules for the wage protection system in a timely to enhance the regulations and imply proper implementations to deliver wages appropriately. These are a few essential functions of the Wage Protection System in the UAE;
Employer Submits Salary Information
The employer needs to submit the relevant information regarding salary and wages to the regulated authorities so their databases can keep records and track the timely distribution of wages among the employees and abide by the law of the Emirates.
Government Verification
These wages or salary records and all the data are sent to the Authority of Labor Law Regulations UAE for verification, regular checks, and monitoring to abide by the laws of the state.
Salary Payment Through WPS Agent
WPS salary transfer online is the most convenient way to transfer salaries on time. The law of the Emirates and WPS ensure the facility of secure bank transfers. They are responsible for wage transfers from the employer’s bank account to the agents. These balances and bank statements are regularly maintained at the employee level to comply with the laws of the Emirates.
Employee Receives Salary
The WPS confirms the salary disbursement and receipts of employment salary sent from the agents with relevant details of payables and salary amount to employees and workers.
Benefits of WPS
For Employees
WPS has various benefits for employees according to the UAE labor law. Here are a few points to give you a brief overview of the perks of WPS for the employees.
Salary Disbursement on Time: The WPS ensures that salaries must be disbursed on time to provide financial security and guard employee rights according to the UAE labor law.
Clear and Transparent Wage Distribution: The wage distribution and payment process is clear and transparent. An employer must disclose the wage distribution and payments to their employees to state the reliability and trust among both parties. There is no opportunity for unethical practices by the employer.
Financial Security: Employees enjoy fair wages and timely payments without financial obstacles and delays.
Extend Work Efficiency: This ethical practice will increase their work efficiency and build a level of trust that helps the rapid growth of business and the economy.
For Employers
WPS has various benefits for employers according to the UAE labor law. Here are a few points to give you a brief overview of the benefits of WPS for employers.
Comply with the UAE Labor Law: The WPS ensures compliance with the UAE Labor Law, and the employers obtain security from legal contract breaches, fines, extra charges, and other legal obligations.
Financial Safety: The employer can be free from hassles, legal obligations, and court cases. They enjoy financial security, stability, and reliability like employees.
Efficient Operations for Salary Disbursement: Wage and salary disbursement is an automated process managed by the WPS, and the employers can operate efficiently, saving time and cost.
Legal Obligations: The WPS wage distribution process is the best way to avoid legal obligations against employer fraud and unethical practices.
Reputation and Trust: WPS wage distribution abides by the UAE labor law. It ensures financial security for both parties and is a trademark of trust and ethical practices. The employer obtained higher trust and built credibility in the market.
How to Register WPS in UAE?
- Employers must register for WPS as a legal priority. They can register online on the official web portal of the relevant authority. They must consider the following for registration;
- They are required to open a corporate bank account at any of the UAE’s registered banks.
- They required a contract with a WPS agent. The WPS agent can be an exchange, a bank, a Fintech organization, or any registered financial institution in the UAE.
- They are required to provide all the information about their employees, their salaries, and payroll details.
How to Check Your Salary Through WPS?
Let’s see how to check WPS status in UAE. The employees can visit the Human Resource Ministry and Emiratization’s online web portals to check their salary status at WPS. You need to enter your Emirates ID to access your salary status.
How Do You Withdraw Your Salary from WPS UAE?
The employees can go for the WPS salary check to confirm their salary status. They can withdraw their salary from WPS in the UAE using UAE bank accounts or WPS cards for ATM withdrawals at banks or exchanges.
Through Bank Transfer
Employees can withdraw their salaries through bank transfers using UAE bank accounts and ATM cards for withdrawals.
Through WPS Payroll Card
Employees can withdraw their salaries through WPS Payroll Cards for ATM withdrawals from exchanges and banks.
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What Happens if There’s a Problem with Your WPS Salary?
If any employee is facing issues in receiving their salary with WPS in the UAE, they can contact their employer to discuss the issue. If it remains unsettled, they can contact the Human Resource Ministry through their online web portal or call their customer support. They will help you to receive your wages with all rights.
What are the penalties for non-compliance?
The legal obligations and penalties for non-compliance for the employer who hired more than a hundred employees and failed to deliver the wages within ten days are;
- The employer will not obtain work permits after sixteen days of salary delay or payment dates.
- An employer who delays the salary for more than a month will be subject to court cases and judicial authorities for further measures.
- The regulated authorities will not allow the employer to register any other company in the UAE.
- The UAE government will liquidate the owner’s bank accounts and guarantee.
- The subject organization will go through the downgrading to the third category and abide by the UAE labor law.
- The UAE authorities grant permission to employees to find new jobs in the UAE.
- The employer who has delayed the wage disbursement for two months has to pay the employee a penalty of five thousand AED.
The legal obligations and penalties for non-compliance for the employer who hired less than a hundred employees and failed to deliver the wages within sixty days are;
- The employer bans from the work permit sponsorship.
- The employer must pay the penalties to employees.
- The employer will face court proceedings to take further measures.
How to Avoid and Lift a WPS Ban?
The employer must adhere to the WPS and UAE labor law compliance, disburse the salaries without delays, and practice fair wage distribution with relevant proof using WPS to avoid WPS bans or legal obligations by the UAE government.
Final Words
As a leading payroll services providers in Middle east, we observed WPS is the proper and reliable wage distribution system and is beneficial for both employers and employees in the UAE. WPS salary processing time and distribution process are efficient and effective, ensuring the salary disbursement complies with the UAE labor law.
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