The United Arab Emirates has tightened its private sector salary payment regime. Ministerial Resolution 0340/2026, issued by the Ministry of Human Resources and Emiratisation (MoHRE) and in force since 1 June 2026, has eliminated the previous 15-day tolerance window and set a unified, non-negotiable date: salaries must be in the worker’s account on the first day of every month.
If your company operates in the UAE or is planning to establish presence there soon, this change affects you directly. Furthermore, it’s not just the deadlines that have changed — the penalties have also changed, and now apply automatically, without any need for a worker to file a prior complaint.
This guide gives you what you need: what the new regulation requires, what penalties apply for delays, who is exempt, and what you must review in your operations to avoid surprises.
What Changes with Ministerial Resolution 0340/2026
However, the new regulation introduces five structural changes to the salary payment regime that apply to all companies registered with MoHRE.
1. Unified payment date: day 1 of the month
First, salaries for the previous month must be paid on the first day of each Gregorian month. As a result, any payment made after that date is automatically considered late. Moreover, there is no additional margin, no tolerance. If day 1 falls on a public holiday or weekend, the responsibility to advance the transfer remains with the employer.
2. Mandatory channel: Wage Protection System (WPS)
In addition, payments must be channelled through the Wage Protection System or through other systems expressly authorised by MoHRE — such as banks, exchange houses, and financial institutions approved by the Central Bank of the UAE.
3. 85% compliance threshold
Meanwhile, a company is considered compliant if it pays at least 85% of the total salaries owed on the due date. Similarly, an individual worker is not considered unpaid if they receive at least 85% of their salary, provided the difference comes from legally justified deductions.
4. Documentary obligation
Furthermore, companies must submit documentation and data proving payment of salaries in accordance with the procedures established by MoHRE.
5. Outsourcing allowed, responsibility not transferable
You can delegate payment processing to external providers, but legal responsibility for timely payment always rests with the employer. Therefore, hiring a third party does not exempt you from penalties if that third party fails.
Staggered penalties: what happens if you’re late
Overall, the consequences activate automatically based on the number of days elapsed since the due date. Importantly, no prior complaint from the worker is required.
| Timeframe | Consequence |
|---|---|
| Day 2 | MoHRE sends notifications to the non-compliant establishment and initiates case monitoring. Consequently, the company is registered as non-compliant in the system. |
| Day 5 | Suspension of new work permit issuance. As a result, the company cannot hire new personnel or renew existing work visas. |
| Day 11 | Administrative fines under Cabinet Resolution No. 21 of 2020. Additionally, the company is reclassified to the third category in the MoHRE classification system. |
| Day 16 | MoHRE registers an individual or collective labour dispute on behalf of the affected workers ex officio. Furthermore, work permits are suspended for companies with 25 or more unpaid employees. |
| Day 21+ | For companies with 50 or more workers and in recurring cases: forced recovery of unpaid salaries, precautionary attachment of assets, and travel ban on those responsible. |
Ultimately, the escalation is fast: within three weeks, the situation moves from an administrative notification to coercive measures that directly affect operations and the freedom of movement of those responsible for the company.
Who Is Exempt
Nonetheless, Ministerial Resolution 0340/2026 contemplates specific exceptions to the WPS calculation:
- Workers with active salary disputes already referred to the courts or with an enforcement order issued, for the period and amount in dispute
- Employees with an active absenteeism report during its validity
- Staff on approved unpaid leave or in situations of inability to work by court order
- Foreign workers employed by foreign companies or their branches in the UAE who receive their salary outside the country, subject to company request and MoHRE approval
- Seafarers on board vessels, subject to company request and in accordance with the applicable ministerial resolution
What You Should Review in Your Operations
If your company operates in the UAE, there are six areas worth reviewing before the new regulation affects you.
1. Effective payment date
To begin with, programme payment orders with sufficient advance notice for the WPS transfer to be completed on day 1, even if it falls on a public holiday or weekend. Notably, the system doesn’t distinguish: if the payment isn’t there on day 1, there’s a delay.
2. Audit of payroll and treasury cycle
Next, review the complete payroll approval and payment process to identify bottlenecks. In particular, bank processing time must be entirely within the previous month — it cannot depend on a bank processing “soon”.
3. Coordination with your payroll provider
Additionally, if you outsource payments, confirm that your provider is authorised by MoHRE and executes transfers with sufficient margin before the due date. Above all, legal responsibility remains yours, regardless of who physically makes the payment.
4. Contracts and outsourcing agreements
Similarly, verify that agreements with agencies and managed service providers contemplate payment dates aligned with the new day 1 deadline.
5. MoHRE portal monitoring
Furthermore, activate notifications on the MoHRE portal and the WPS system to receive alerts on any incident before the automatic penalties activate.
6. Free zones with their own regime
Finally, companies registered in free zones with independent labour regulations — DIFC and ADGM in particular — should verify whether Resolution 0340/2026 is directly applicable to them or whether their specific regime prevails.
What the Resolution Does NOT Change
Importantly, the new regulation does not modify employment contracts, salary amounts, or agreed employment benefits. Instead, the change is exclusively about the compliance and supervision structure of payment.
Companies that were already paying salaries on day 1 of each month will see little operational difference. In contrast, the real impact is for those that until now used the 15-day margin as a standard treasury practice — for them, adaptation is urgent.
The Context: Why the UAE Has Tightened WPS
The Wage Protection System has been operational since 2009 as a mechanism for electronic supervision of salary payments. In this context, Resolution 0340/2026 is part of a broader strategy by the UAE government to strengthen the guarantee of worker payment and reduce recurring delays that particularly affected the construction, hospitality, and services sectors.
For Spanish-speaking companies operating in the UAE — especially in construction, engineering, professional services, and technology — the new regulation therefore requires an immediate review of payroll, treasury, and internal supervision processes.
Do You Need to Review How This Affects You?
If your company operates in the Emirates and you want to make sure your payroll process complies with the UAE salary regulations 2026 under Resolution 0340/2026, at Setup in the UAE we can help you review your current operations, identify bottlenecks, and coordinate the necessary adjustments before automatic penalties activate.
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Sources: Ministry of Human Resources and Emiratisation (MoHRE), Ministerial Resolution 0340/2026, Federal Decree-Law 33/2021, Cabinet Resolution 21/2020.
