Cost of Hiring Employees in the UAE

The UAE is an innovation and investment center, attracting companies with its growing economy. With its strategic location between Asia and Europe, the UAE also enables quicker access to diverse markets and to foster international partnerships.

Here we’ve prepared a breakdown of employment costs and taxation for employers in the UAE.

Overview of average salary levels in the UAE

These figures are only guidelines and individual salaries may vary based on education, experience, location, and job title.

Employer costs in the UAE

There are no employment taxes for the employee in the UAE. The net salary can be divided into two parts:

1. Basic salary – The basic salary, determined by the employee’s role, qualifications, and industry norms, is the core of their compensation and the basis for calculating Gratuity pay.
2. Allowances – This covers employee expenses. Allowance structure is flexible. The components and pay schedule are agreed upon with your employee.

Common Allowances in the UAE

The common allowances structure for employer is as follows:

• Health Insurance: Providing health insurance coverage for employees is mandatory in the UAE. Employers bear the cost of health insurance premiums, which vary based on factors such as coverage level and the number of employees covered.
• Transportation: This includes, for example, annual flights home or to the UAE for the employee or their family members.
• Airfare allowance: This covers the commuting costs between an employee’s home and workplace. This can be a fixed monthly amount or a reimbursement of actual expenses based on receipts.

Expand Your Business with Employer of Record Services

Companies use Employer of Record (EOR) services to hire staff in the UAE without establishing a local office. 

EOR is for facilitating the employment of international workers and managing remote teams. This service handles the following: 

• Employment legalities
• Payroll
• Employment tax
• Other HR tasks for simplified employment in the UAE and other countries.

Simplify your HR process and get personalized information on the cost of hiring employees in the UAE with Emerhub’s EOR service. Fill out our form below this article.