Ramadan – overtime, reduced working hours and consequences of noncompliance

The UAE Labour Law (Federal Decree Law No. 33 of 2021) together with UAE Cabinet Resolution No.1 of 2022 (the UAE Labour Law) applies to all companies and employees in the private sector in the UAE, (except for those working within the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market (ADGM)).

Under the UAE Labour Law, working hours must generally not exceed eight hours per day or 48 hours per week, over a six-day working week; however, working hours can be increased to a maximum of 10 hours per day (the additional two hours being overtime). Overtime must not exceed two hours per day, unless the work is necessary to prevent serious loss or accident (or to eliminate or mitigate its effects).

During the holy month of Ramadan, the working hours of employees are reduced by two hours per day. The reduction in working hours applies to all employees in the private sector (excluding the DIFC and ADGM) irrespective of whether the employees are Muslim or fasting. Therefore, the maximum working hours for an employee working in the UAE during Ramadan are six hours per day or 36 hours per week (based upon a six-day working week) or 30 hours per week (based upon a five-day working week). This means that overtime charges during Ramadan should apply after the 7th hour (if there is a one-hour break for lunch), as the daily working hours of eight hours are reduced to six hours per day.

Under the UAE Labour Law, any employee working in excess of the normal working hours (or reduced normal working hours during Ramadan) is entitled to overtime payments in accordance with the UAE Labour Law. The amount of overtime pay due for working overtime will depend on when that overtime is worked. The overtime provisions (and other working time provisions) do not apply to the following categories of employees:

• chairmen of the boards of directors and board members
• employees who hold supervisory positions (such that they represent the employer)
• crew of naval vessels and employees who work at sea who have special working conditions of service due to the nature of their work
• employees whose work is of a technical nature necessitating the continuation of work through consecutive shifts (provided that the average working hours do not exceed 56 hours per week)
• employees involved in preparatory or complimentary works that must be carried out outside of the normal working day.

The DIFC and ADGM have their own employment legislation, and therefore, different rules apply in these free zones. In the DIFC, reduced working hours during Ramadan only apply to Muslim employees, while in the ADGM, reduced working hours during Ramadan only apply to Muslim employees who observe the fast. Employees who are fasting can nevertheless voluntarily choose to work more than six hours per day.

Private-sector employees in the UAE will also have their work hours reduced by two hours throughout Ramadan 2023. The Ministry of Human Resources and Emiratisation (MOHRE) has announced that the Ramadan working hours for public sector employees will be 09:00 to 14:30, from Monday to Thursday, and from 09:00 to 12:00, on Fridays of every week. 

Consequences of noncompliance

The UAE Labour Law provides protection to employees against discrimination in the workplace based on certain characteristics, including religion. Whilst there are no specific penalties attributed to discrimination, an employer may be liable to fines ranging between AED 5,000 and AED 1,000,000 for breaching the UAE Labour Law (the fine imposed can also be multiplied for companies by the number of employees affected by the breach). Thus, it would be open to an employee to file a complaint with the MOHRE (or the relevant free zone authority depending upon where the employing company is based) if they believe they have been discriminated against. 

Similarly, in the DIFC and ADGM, there are also anti-discrimination provisions under the DIFC Employment Law No. 2 of 2019 and ADGM Employment Regulations 2019 respectively, which prevent discrimination against an employee based on certain protected characteristics, including religion. If an employer requires Muslim employees to work more than the reduced Ramadan working hours, this could be considered indirect discrimination and could give rise to potential claims before the DIFC or ADGM courts (as applicable). 

In the event of a finding of discrimination under the DIFC Employment Law, the DIFC court could award the employee compensation of up to one year’s wage (salary and allowances) which can include an award in respect of injury to feelings. In addition, the DIFC court can also make a recommendation for the employer to take certain prescribed steps.  If the employer unreasonably fails to comply with any recommendation made by the court, the court will have the discretion to increase the amount of monetary compensation awarded to two years' wages.

Under the ADGM Employment Regulations, the ADGM court could award up to a maximum of three years’ basic wage as compensation for discrimination. 

It is important that all employers take all reasonably practicable steps to prevent discrimination in the workplace and ensure fair and consistent treatment of employees. Not only will such action help in avoiding costly claims but this can also lead to improved business performance, innovation and productivity.