Small But Vital Tips for New Companies Regarding Labor Department Rules
All new registered companies get used to become busy with huge loads of paper works and different rules of government authorities, one of the most important department which is also quite strict with paying fines is labor department, according to my experience below mistakes are common ones with this department:
- Be careful of late submission of labor contract:
When you hire the employee and they enter the country or change the status, in any of the case you have 60 days to submit labor contracts to avoid AED 1053 fines for each person. Please take it serious then let the employees complete their medical fitness tests and emirates ID typing, then immediately type labor contract get it signed by authorize signatory of labor department in your company (most of the time is sponsor only) and employee and submit it to any Tasheel office. Keep your submission receipt safe till the time you receive original labor contract and labor card.
- Don’t forget to collect employee’s labor card and contract on time from post office:
Many times you might get busy with new setup running and forget to check P.O. box of the company, if you don’t collect them on time from post office, they will return it to labor department and you have to pay AED 1000 to receive it back, So check the P.O. box at least every two weeks to avoid this mistake.
- Open your WPS account ASAP:
WPS or Wage Protection System is there to make sure your employees are getting paid on time and as per labor contract, even if they are receiving their salary through your normal bank account, check or cash and you are keeping all receipts, still this won’t be enough, ask your bank or exchange company to manage your company WPS and transfer salaries only through that, if you don’t pay attention to this matter and for two months salaries don’t transfer through WPS your company account with labor department will be blocked and you can’t have any transactions, it might affect other companies with same sponsor as well.
