DUBAI, 13 June 2004 — The United Arab Emirates will collect bank guarantees from businesses to help pay any delayed wages of staff, local media reports said.
Large companies with more than 1,000 workers will now have to pay 3,000 dirhams for every new employee, plus a bank guarantee of 500,000 dirhams to cover all employees. The decision comes after a spate of cases of unpaid wages in the country.
According to the report, the ruling was issued by UAE Minister of Labor and Social Affairs Matar Humaid Al-Tayer.
However, under the new rules, the ministry will stop demanding a bank guarantee for tickets for absconding workers. The rule takes effect immediately.
and labor departments have been ordered to collect the bank guarantees before approving work permits requested by companies falling in the category, the reports said.
The amendment authorizes the ministry to take court action to order the payment of dues from the bank guarantee provided.
It goes on to say that the guarantee money must be paid by the employer, not deducted from the employee. The surety should also be paid when the application for an employee is made or during transfer of sponsorship.
