Mahmoud Ahmed April 19, 2026May 13, 2026 Periods of regional uncertainty raise immediate, practical questions for businesses. The starting point, however, remains unchanged: UAE Labour Law continues to apply in full, regardless of external circumstances For employers, the real issue is not whether the law applies, but how to take decisions (cost-cutting, remote work, termination) without creating legal exposure. FOR EMPLOYERS: WHAT YOU SHOULD DO Continue to meet all statutory obligations Salary payments, employee safety, and compliance are not optional, even in times of disruption. Take a practical approach to remote work There is no legal right to work remotely. If the employer requires physical attendance and the contract does not provide otherwise, employees are expected to attend. That said, where roles can clearly be performed remotely, a refusal to consider flexibility may create unnecessary friction and risk. Use lawful mechanisms to reduce costs If cost reduction is needed, employers have options — but they must be applied correctly: Salary reductions require employee agreement If agreement is not reached, employers may consider termination and restructuring, following proper procedures Document everything Any agreed changes to salary or working conditions must be clearly documented. This is critical for enforceability. Follow proper termination procedures Termination remains a lawful option, but only if: notice requirements are respected due process is followed all end-of-service entitlements are paid WHERE COMPANIES OFTEN GET IT WRONG Remote work refusals Employees cannot unilaterally decide to work remotely. If they refuse to attend work without agreement, this may lead to disciplinary consequences, including termination. Salary reduction misunderstandings Employers cannot impose salary cuts unilaterally. If a salary reduction is implemented without agreement: it is likely non-compliant the employee may file a claim for unpaid wages or breach of contract Refusal to accept a salary cut Employees are fully entitled to refuse. However, this does not protect them from termination if the business decides to restructure and follows the correct legal process. Force majeure misconceptions There is no “shortcut” termination route based on force majeure in employment. In practice: Termination is termination The same legal requirements apply, regardless of the reason If a company cites “force majeure” but does not follow proper procedures, the termination can be challenged. FOR EMPLOYEES: KEY REALITIES There is no automatic right to remote work Refusing to attend work may lead to consequences Salary reductions must be agreed — but refusal may trigger broader employment decisions If salary cuts are imposed without consent, employees may challenge them legally If termination procedures are not correctly followed, employees may file a claim WHAT EMPLOYERS SHOULD NOT DO Assume external events justify unilateral decisions Impose salary reductions without agreement Treat force majeure as a workaround for termination Ignore proper process when terminating employees KEY TAKEAWAY UAE Labour Law is clear. What creates risk is not the situation itself, but how companies respond to it. The safest approach is simple: agree where possible document everything and where decisions need to be made, follow the law strictly Anything else is where disputes begin. While the legal framework is clear, many real life situations fall into grey areas and depend on specific facts, contractual terms, and how decisions are implemented in practice. If you are facing a similar situation, we would be happy to review your position, assess your risk exposure, and guide you on the most appropriate course of action. For tailored advice on your specific situation: info@fichtelegal.com.
