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DIFC Employment Law and DEWS
DIFC Law No. 2 of 2019, as amended by DIFC Law No. 4 of 2020
In short
DIFC Law No. 2 of 2019 governs every employment relationship in the Centre. It requires a written contract within the first month, sets minimum leave and working conditions, and replaced end of service gratuity with DEWS, a funded workplace savings scheme into which employers contribute monthly. The penalty regime for late final payments is strict and it is enforced.
- Instrument
- DIFC Law No. 2 of 2019, as amended by DIFC Law No. 4 of 2020
- In force
- 28 August 2019, with DEWS from 1 February 2020
- Regulator
- DIFC Authority
- Applies to
- Every employee whose employer is registered in the DIFC and whose work is wholly or mainly carried out in the Centre, including short-term and part-time staff.
What it requires
| Obligation | What it means in practice |
|---|---|
| Issue a written contract | Within the first month of employment, covering the particulars the Law prescribes. |
| Enrol employees in DEWS or a qualifying alternative | From the start of employment, with monthly core contributions on basic salary. |
| Provide minimum leave | 20 working days annual leave after the first year, plus public holidays, sick leave and statutory parental leave. |
| Pay final dues within 14 days | All amounts owed on termination, or the penalty regime starts to run. |
| Maintain records | Contracts, pay records, leave records and working time records available for inspection. |
Deadlines
| Item | When |
|---|---|
| Written employment contract | Within 1 month of the start date |
| DEWS contribution | Monthly, by the deadline set in the scheme rules |
| Final payment on termination | Within 14 days of the termination date |
| Visa cancellation | Within 30 days of termination |
If you get it wrong
DEWS, and what replaced gratuity
From 1 February 2020 the DIFC ended accrual of end of service gratuity and replaced it with the DIFC Employee Workplace Savings plan. Employers pay a monthly core contribution calculated on the employee's basic salary: 5.83 per cent for employees with less than five years of service and 8.33 per cent for those with five years or more.
Gratuity accrued before February 2020 did not disappear. It was crystallised as at that date and is either paid into DEWS or held by the employer and paid on termination. Getting that historic calculation right matters, because employees who joined before 2020 are the ones most likely to challenge a final settlement.
Employers can use a qualifying alternative scheme instead of DEWS, but it needs a Certificate of Compliance from the DIFC. Most employers stay with DEWS because the administrative path is already built.
Leave entitlements in practice
Annual leave is 20 working days once an employee has completed a year, accruing proportionately during the first year. Public holidays are additional. Sick leave runs to 60 working days in any twelve month period, paid at full salary for the first ten days, half for the next twenty and unpaid thereafter.
Maternity leave is 65 working days, with the first 33 at full pay where the employee has a year of service, and there is a right to return to the same role. Paternity leave is five working days. There is also a right to request flexible arrangements around the return to work, which employers must consider properly rather than refuse by reflex.
Termination, notice and the 14 day rule
Statutory minimum notice runs from seven days during the first three months, to 30 days up to five years of service, to 90 days beyond that. Contracts can improve on it and frequently do. Termination for cause requires conduct that meets the standard in the Law, and the bar is genuinely high.
The rule that causes the most litigation is Article 19. Everything owed on termination must be paid within 14 days. Miss it and a penalty accrues at the daily wage rate for each day of delay, without a cap. Disputes about whether a bonus was owed do not pause the clock, so the safe approach is to pay the undisputed amount on time and argue about the rest afterwards.
Discrimination and the employer's exposure
The Law prohibits discrimination on grounds including sex, marital status, race, nationality, religion, age, pregnancy and disability, and it covers recruitment, terms, promotion and dismissal. Victimisation for raising a complaint is separately prohibited.
Compensation for discrimination is capped by reference to the employee's annual wage, but the reputational exposure in a small market is the bigger risk. Employers with a written policy, trained managers and a documented complaints route defend these claims far better than those without.
Common questions
What is the DEWS contribution rate?
The core contribution is 5.83 per cent of monthly basic salary for employees with under five years of service, and 8.33 per cent for five years and above. Employees can make voluntary contributions on top, and employers can agree to pay more than the core rate.
What happens if final salary is paid late in the DIFC?
A penalty accrues equal to the employee's daily wage for every day the payment is outstanding beyond 14 days from termination. The DIFC Courts apply it as a matter of course. Pay everything that is not genuinely in dispute within the window.
Does DIFC Employment Law apply to remote employees outside the UAE?
It applies where the employee's work is wholly or mainly carried out in the DIFC. Genuinely remote staff working from another country are usually outside it, but that creates a different problem, because the employer may be creating a taxable or employment presence in that country instead.
Can an employer still pay gratuity instead of DEWS?
Not for service after February 2020, unless it operates a qualifying alternative scheme with a Certificate of Compliance from the DIFC. Gratuity accrued before that date is dealt with separately and still has to be honoured.
Check the source
This page summarises the position as at September 2026. Laws and regulations change. The authoritative text is published by the regulator: DIFC employment legislation. Nothing here is legal advice.Compliance is a calendar, not a project
Six recurring obligations across four different bodies, and nobody sends a reminder. We track them for DIFC entities so renewal is never the moment you discover a gap.