Ministerial Resolution No. (340) of 2026 on the Wage Protection System (WPS) in the United Arab Emirates was issued as part of efforts to strengthen the protection of workers’ rights and regulate salary payment processes with greater accuracy and transparency. The resolution further develops wage payment mechanisms in the private sector and establishes clearer controls to ensure employer compliance with payment deadlines, along with a graduated set of penalties for violators.

The resolution stipulates that the first day of each Gregorian month is the unified due date for the previous month’s salary. Any payment made after this date is considered a delay in wage disbursement. Salaries must be paid through the Ministry-approved Wage Protection System or other officially recognized systems.

It also clarifies compliance standards, stating that an establishment is considered compliant if it transfers at least 85% of the total wages of its employees by the due date. In such cases, an employee is not considered unpaid if they have received 85% of their wage, provided that any difference results from legally permitted deductions.

The resolution exempts certain categories from the Wage Protection System calculation, including workers with ongoing labor cases before the courts, those reported as absent without notice, employees on unpaid leave or under legal restriction (provided the Ministry is notified), as well as seafarers working on vessels and workers paid outside the country. It also includes certain entities such as banks, places of worship, taxi vehicles, and fishing boats owned by UAE nationals.

Regarding compliance enforcement, the resolution introduces a progressive penalty system for non-compliant establishments. It begins with electronic monitoring and warnings from the due date, followed by suspension of new work permit issuance on the fifth day. On the eleventh day, administrative fines are imposed and the establishment may be classified in Category Three in case of repeated violations. On the sixteenth day, labor disputes may be registered and work permits suspended in certain sectors if the number of affected workers reaches 25 or more. By the twenty-first day, measures may escalate to precautionary asset seizures, travel bans, and referral to the Public Prosecution, particularly for large establishments employing 50 workers or more.

The resolution also allows establishments to delegate wage payment operations to a third party; however, legal responsibility remains with the employer before the Ministry. It further repeals Ministerial Resolution No. (598) of 2022 and any provisions that conflict with it. The resolution will come into effect on 1 June 2026.

Overall, the new resolution reflects a clear direction toward strengthening compliance within the Wage Protection System, safeguarding workers’ rights, and enhancing regulatory oversight of the labor market in the UAE.