Hiring your first employee in the UAE requires seven sequential steps: MOHRE registration, offer letter, labour contract, visa application, medical test, Emirates ID, and WPS payroll setup. The process takes 3 to 6 weeks from offer acceptance to the employee’s first working day. Total employer cost per hire is approximately AED 5,000 to AED 12,000 in visa and processing fees, plus mandatory health insurance at AED 1,500 to AED 4,000 annually. Last updated: June 2026.
For the UAE labour law framework, see UAE labour law basics: what foreign employers need to know. For the full compliance checklist, see UAE company compliance checklist: what to do after incorporation.
What are the seven steps to hire a UAE employee?
| Step | Action | Timeline | Cost |
|---|---|---|---|
| 1 | Register with MOHRE as an employer | 1–3 working days | AED 200–500 |
| 2 | Issue an offer letter | Same day | Internal |
| 3 | Sign a MOHRE-compliant labour contract | 1–2 working days | AED 200–500 (typing) |
| 4 | Apply for the employee’s entry permit or status change | 3–5 working days | AED 1,200–1,800 |
| 5 | Employee completes medical fitness test | 1–2 working days | AED 350–500 |
| 6 | Register for Emirates ID (biometric) | 1–3 working days | AED 370–600 |
| 7 | Visa stamping and WPS payroll activation | 2–5 working days | AED 700–1,500 |
| Total | 3–6 weeks | AED 5,000–12,000 |
How do you register with MOHRE?
Every UAE employer must register with the Ministry of Human Resources and Emiratisation (MOHRE) before hiring any employee. Registration requires:
- A valid UAE trade licence (mainland or free zone)
- An active establishment card (immigration card)
- At least one authorised signatory with a valid UAE residence visa
- A corporate bank account enrolled in WPS
MOHRE registration is processed through the MOHRE portal or through an authorised PRO/typing centre. Free zone companies register through their free zone authority, which coordinates with MOHRE. DIFC and ADGM have separate employment registration processes.
What must a UAE employment contract include?
Since Federal Decree-Law No. 33 of 2021 (effective 2 February 2022), all UAE employment contracts are fixed-term — maximum 3 years, renewable. The contract must include:
- Full legal names of employer and employee
- Job title, description, and scope of duties
- Start date and contract duration (maximum 3 years)
- Basic salary (the fixed monthly amount before allowances)
- Allowances — housing, transport, and other specified separately from basic salary
- Working hours and weekly rest day
- Probation period (maximum 6 months)
- Notice period (30 to 90 days)
- End-of-service gratuity terms
The distinction between basic salary and total salary matters because end-of-service gratuity is calculated on basic salary only — not total compensation. Founders should structure the split carefully: a higher basic salary increases the gratuity liability; a lower basic salary with higher housing allowance reduces it.
All contracts must be registered with MOHRE through the standard labour-contract submission process. Unregistered contracts expose the employer to administrative penalties and weaken enforceability in dispute resolution.
How does the visa application work?
The employee visa application follows two tracks:
New employee from outside the UAE — the employer applies for an entry permit through MOHRE (mainland) or the free zone authority (free zone). The entry permit is typically valid for 60 days and allows the employee to enter the UAE. Upon arrival, the employee completes the medical test, Emirates ID biometric registration, and visa stamping.
Employee already in the UAE — if the employee holds a valid UAE visa (tourist, visit, or from a previous employer), the employer applies for a status change that converts the existing visa to an employment visa. This avoids the need for the employee to leave and re-enter the country.
Visa quotas depend on the company type:
– Mainland companies: 1 employee visa per 80 sqft of Ejari-registered office space
– Free zone companies: visa quota set by the free zone authority based on office/desk tier (typically 1 to 4 per flexi-desk, more for physical offices)
What does mandatory health insurance cover?
UAE law requires employers to provide health insurance for every employee from the first day of employment. The requirement is administered by:
- Dubai Health Authority (DHA) — for Dubai-based employees (Essential Benefits Plan minimum)
- Abu Dhabi Department of Health (DOH) — for Abu Dhabi-based employees (Thiqa-equivalent minimum)
- MOHRE — for employees in other Emirates (basic coverage minimum)
Employer costs range from AED 1,500 to AED 4,000 per employee annually for basic compliant plans. Premium plans covering dental, optical, and maternity add AED 3,000 to AED 8,000. Group insurance rates become available once the company has 5 or more employees.
Health insurance must be active before the visa stamping can be completed. No insurance = no visa = no legal employment.
How do you set up WPS payroll?
The Wage Protection System (WPS) requires all salary payments to be processed through an approved UAE bank or payment agent. WPS registration is typically bundled with the corporate bank account setup.
Steps to activate WPS:
– Open a corporate bank account with a WPS-enabled UAE bank (Emirates NBD, Mashreq, RAKBANK, CBD)
– Register the company’s MOHRE establishment number with the bank
– Add each employee’s bank account details (or salary card) to the WPS system
– Process monthly salary transfers through the WPS module in the bank’s online portal
Non-compliance with WPS triggers an automatic MOHRE alert that blocks all visa processing for the company. Persistent non-payment can lead to criminal referral under UAE labour law.
For bank selection guidance, see how to open a corporate bank account in the UAE.
What ongoing employer obligations apply?
After the first hire, five ongoing obligations apply:
- Monthly WPS salary payment — must be processed by the contractual payday each month
- Health insurance renewal — annually, before the policy expiry date
- End-of-service gratuity accrual — 21 days’ basic salary per year (years 1–5), 30 days thereafter
- Emiratisation compliance — if the company reaches 50+ employees, a 2 % annual Emirati headcount increase is required (AED 6,000/month penalty per unfilled position)
- Contract renewal or termination — fixed-term contracts must be renewed before expiry; non-renewal requires notice per the contract terms
Frequently asked questions
Can I hire a freelancer instead of an employee?
Yes. UAE companies routinely engage freelancers holding their own permits as independent contractors. The freelancer invoices the company, and no employment relationship exists. No visa, WPS, health insurance, or gratuity obligations apply. For freelance permit details, see UAE freelance visa: how to work independently in the UAE.
What is the minimum salary in the UAE?
The UAE does not have a legislated minimum wage for private-sector employees. However, practical minimums exist: visa processing requires a salary that meets MOHRE’s internal thresholds, and dependent sponsorship requires AED 4,000+/month (with accommodation) or AED 10,000+ (without).
Can free zone companies hire employees who work from a mainland location?
Yes. Free zone visa holders can live and work anywhere in the UAE. The visa is tied to the free zone entity, but the physical work location is not restricted to the free zone premises.
Sources and further reading
- Federal Decree-Law No. 33 of 2021 — UAE Labour Law
- MOHRE — Employer registration, labour contracts, and WPS (mohre.gov.ae)
- Dubai Health Authority (DHA) — Essential Benefits Plan minimum coverage (dha.gov.ae)
- ICP — Employee visa application (icp.gov.ae)
- GDRFA Dubai — Status change and visa stamping (gdrfad.gov.ae)