Overtime Calculation in UAE

When an employee works extra hours than the normal working hours, those extra hours are considered as overtime and the payment made for the extra hours worked is known as overtime payment.

In this article, we are trying to answer some of the frequently asked questions related to overtime in UAE.

1. What are the maximum working hours in UAE?

   As per Article 17 of the UAE Labor Law, the maximum working hours for workers shall be (8) eight hours per day or (48) forty-eight hours per week. The period spent by the worker during the commute between his place of residence and the workplace, shall not be counted in the working hours.

2. What are the types of overtime applicable in UAE?

   There are 2 types of overtime as mentioned below;

   • 125% applicable for additional daytime working hours.
   • 150% applicable for night hours, weekly off and public holidays. The time between 10 PM and 4 AM will be taken into consideration while calculating night hours’ overtime; workers working based on shifts shall be excluded from this overtime. Also, work performed during the weekly off day or during the official holidays is also compensated with another day off or 150% of overtime.

3. Is UAE overtime calculated against employee basic salary or total salary?

   As per UAE labor law, overtime is calculated against employee’s basic salary.

4. What is the law relating to overtime of juveniles?

   The actual working hours of juveniles shall not exceed six hours per day and they shall not work between 7 PM and 7 AM. Also, the juvenile shall not work overtime or work on weekends or official holidays.

5. What is the formula to calculate overtime in UAE?

   Please see the below formula to calculate overtime.

   (Basic salary per month/Standard Monthly Hours* OT hours* OT Type)

   Please see the below example for a better understanding

   Basic Salary : 4,000/-

   Standard monthly hours : 240

   1 – Employee Worked 10 Extra Hours between 6 PM to 8 PM in a month.

   OT Type: 125%

   Over time amount = 208.33

   i.e.,4,000/240*10*125%

   2 – Employee worked for 15 Extra Hours during nighttime (i.e., 10 PM to 4 AM)

   OT Type: 150% (Overtime hours belong to nighttime hours)

   Over time amount = 375.00

   i.e.4000/240*15*150%

   3 – Employee worked 10 hours during the weekly day of rest and no compensatory off provided

   OT Type: 150% (Overtime hours belong to weekly holiday)

   Over time amount = 250.00

   i.e.4000/240*10*150%

   Note – There are no defined standard monthly hours in Labor law; we considered 240 hours as standard monthly working hours for our calculation.

Please see the below Article 19 from UAE labor law Federal Decree-Law No. (33) of 2021.

Article (19)

Overtime

1. The employer may instruct the worker to work overtime over the normal working hours, provided that they do not exceed two hours per day. The worker may not be instructed to work for more than that period, except in accordance with the conditions and rules specified by the Implementing Regulation hereof. In all cases, the total working hours shall not exceed (144) one hundred and forty four hours every (3) three weeks.
2. If the work conditions necessitate that the worker works for more than the normal working hours, the excess period shall represent overtime, for which the worker shall receive a wage equal to the wage corresponding to the normal working hours, which is calculated according to the basic wage plus an increase of not less than (25 %) twenty five percent of that wage.
3. If the work conditions require that the worker works overtime between 10 pm and 4 am, the worker shall be entitled, regarding the overtime, to receive the wage prescribed for the normal working hours calculated according to the basic wage plus an increase of not less than (50%) fifty percent of that wage. The workers working based on shifts shall be excluded from this clause.
4. If the circumstances require that the worker works on the weekend specified in the employment contract or work regulation, he shall be compensated with another day off or he shall be paid the wage of that day according to the wage established for normal working days, plus an increase of not less than (50%) fifty percent of the basic wage for that day.
5. A worker shall not be instructed to work for more than two consecutive weekend days, except for day workers.

Disclaimer:
Whilst every effort has been made to ensure the accuracy of this information, HLB HAMT will not accept any liability arising out of errors or omissions. Please note that this blog is not all-inclusive. Our guidance is designed only to give general information on the issues/topics covered. It is subjected to change and not intended to be a comprehensive summary of all laws which may be applicable to your situation, treat exhaustively the subjects covered, provide legal advice, or render a legal opinion.

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