Why flexible employment laws matter more than ever

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2026

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement


Why flexible employment laws matter more than ever

Sponsored by

2025SWTenet.png

SW Tenet review why flexible employment laws matter more than ever

When the UAE updated the Labour Law in 2022, the remote working model was transformed from a temporary crisis response into a permanent and legally protected employment model. 

However, the relevance of this legislation goes beyond flexibility. The Ministry of Human Resources and Emiratisation (MOHRE) has the power to issue immediate and mandatory remote work circulars to protect public safety during unforeseen circumstances, such as extreme weather events or regional disruptions. In 2026 this authority has already been exercised.

As these circumstances are hard to predict, employers should timely ensure that any arrangements regarding remote work are carefully reviewed for compliance with applicable labour regulations. It is crucial that companies comply with a properly structured employment framework that reflects how work is actually performed in practice. 

The current legislative framework expressly recognises “Remote work” as a model where work is performed wholly or partially outside the workplace and the connection between worker and employer is electronic, and subsequently introduces the Remote employment contract as a casual model a worker may be employed under. 

As these provisions form part of federal legislation, their application is not restricted to mainland businesses. Companies across the UAE should ensure that they are not missing the stipulated requirements. It should also be noted that financial free zones such as the DIFC and ADGM have their own employment-related framework.

For companies it is important to set up and maintain correct and comprehensive:

(1)     Contractual Requirements: Verbal agreements are legally invalid. It is required to sign a written remote work contract or addendum.  These documents need to include the agreed location of the employee and working hours. 

(2)     Internal HR Policies: although strictly mandatory for companies with more than 50 employees, these documents could be important for all employers to define which roles are eligible for hybrid or full remote work and to set up communication protocols and other necessary workflow provisions

(3)     Equipment and financial requirements such as data and IT provision, expense reimbursement policies. Whether the expanded regulation in this sphere is required depends on the business of the employer and the role of the employees. 

(4)     Confidentiality Agreements and IT Security and Data Protection Policies: these may include NDA provisions for remote employees, network restrictions, company device control rules, non-competition obligations.

When policies and internal rules have not been established or don’t reflect actual processes, the legal risk for employers can arise gradually. 

Under the labour legislation, general violations of labour resolutions carry administrative fines for companies from AED 5,000 to AED 1,000,000. 

For employers, the real question is no longer whether remote work is being used. A better question is whether it has been documented, governed, and implemented in a way that can withstand scrutiny.  

Companies that treat remote work appropriately from a legal and governance perspective will be in a stronger position, not only from a compliance standpoint, but also in terms of preserving operational control, accountability, and business continuity. 

We recommend that companies review their internal policies regulating remote work to ensure that they are aligned not only with legal requirements, but also with the actual nature of employee relationships.

SW Tenet has extensive experience in advising on employee-related services in the UAE. We can assist you with the following:

·       elaborating labour policies and bonus systems

·       wage benchmarking studies

·       training and advising on issues related to relocating employees from different jurisdictions

·       advising on tax implications for a firm and its employees in the context of international and remote work

·       assistance in obtaining visas / Emirates ID, registering in digital compliance systems / applications, WPS set-ups

more across site & shared bottom lb ros

More from across our site

From Dhruva Advisors to Svalner Atlas, Ryan is growing fast. Tom Shave discusses consolidation, competition, and tax’s private equity debate
The UK has confirmed its approach to the OECD’s side-by-side deal, but US-parented groups may find pillar two compliance remains far from straightforward
Fragmented pillar two taxation and increased use of AI by tax authorities have left clients fearful of heightened disputes exposure
Grant Thornton Advisors’ latest acquisition has produced the fifth-largest US advisory firm by revenue, but there’s still a clear gulf between it and the big four
Crowe joins Grant Thornton, WTS and Ryan in attracting PE investment, suggesting that dealmakers remain bullish on the tax advisory sector
HMRC expects advisers to meet ever-higher compliance criteria. After 24 consecutive qualified audit opinions, many will ask whether HMRC should hold itself to the same standards
The purchase of Marosa represents the second major tax tech consolidation this week, raising questions of a broader industry trend
Peru’s approach to TP is increasingly at odds with OECD-style profitability policies, exposing multinational groups to asymmetric tax adjustments
Hany Elnaggar examines how the region's legacy economic substance regimes and the OECD's pillar two framework are converging on the same underlying test
The deals for TP Accurate and Intra Pricing Solutions will enhance Alphatax’s ability to support clients with the full TP lifecycle, the tax tech provider claimed
Gift this article