On 10 April 2018 the United Arab Emirates (UAE) Cabinet approved a new law on equal wages and salaries for men and women, aiming to ensure that women have equal opportunities and to further empower women to participate in the UAE’s development in leadership roles. This is the latest step in the UAE’s very public commitment to achieving equality for all and women’s empowerment and the UAE leadership’s recognition of the important contribution women make to all facets of UAE society and the economy.
Equality for all UAE citizens is a fundamental right under the UAE constitution which provides that “Equality, social justice, and providing safety, security, and equal opportunities to all citizens are pillars on which the community stands.” The right to equal pay for equal work is already set out in brief in existing legislation such as the UAE Federal Labour Law No. 8 of 1980 (the UAE Labour Law) which provides that a “working woman shall be entitled to the same wage as that of a working man, if she does the same work”. The UAE has also adopted the International Labour Organisation’s Equal Remuneration Convention, 1951 under UAE Federal Decree No. 30 of 1996 and set up various bodies to support and promote women’s equality in the UAE. However, this new law will be the first dedicated piece of legislation to address in detail issues surrounding equal pay and setting out specific requirements for employers in that regard.
At this stage a draft law has not been released so there is no detail available on the specific provisions, who they will apply to and how they will be enforced. Enforcement of equal pay legislation is particularly challenging as we can see from western jurisdictions which in some cases have had such legislation in place for up to 50 years and still have a significant gender pay gap (as is becoming apparent as a result of reporting private and public organisations are making on a daily basis). Transparency and reporting will be key and in the UAE the Wages Protection System, through which “onshore” companies are required to pay employees, could become a key tool for monitoring compliance.
There has not been any indication as to timing for when the bill will be presented to the UAE Federal National Council for final approval or when it would be published and come into effect. However, based on equal pay legislation in other jurisdictions some of the questions UAE employers should start considering to assess their position include:
• How are starting salaries determined for job offers?
Are these based on an applicant’s previous earnings history (which could perpetuate any existing gender pay gap) or is there an independent analysis of the job description and responsibilities involved and the market rate for the same? It is not just job titles that should be considered but the nature of the roles and the similarities in levels of responsibilities and contributions to the business.
• Is there transparency on how salaries, pay raises and bonuses are calculated?
If there are salary bands in place, do employees know what they are and what they need to do to move within them? Is there a clearly communicated bonus policy that applies equally to all employees?
• Does everyone have equal advancement opportunities?
Are all employees equally supported with training and professional development opportunities? Are career development tracks clearly communicated? Any impediments to promotions and advancement would have a significant impact on an individual’s long term earnings potential and career development.
We will issue an update once we have any additional information. In the meantime if you have any queries on how your business may be affected by the enactment of equal pay legislation in the UAE please do not hesitate to contact us.