The UAE salary payment deadline has moved to the 1st of the month
From 1 June 2026, every private sector employer registered with the Ministry of Human Resources and Emiratisation (MoHRE) must transfer employees' wages for the preceding month no later than the 1st day of the following month. The requirement is set out in Ministerial Resolution No. 340 of 2026.
The change matters because the previous 15-day grace period — under which wages could be paid up to the 15th of the month following work — has been abolished. Any transfer after the 1st is now treated as a late payment and triggers an escalating penalty regime that can reach precautionary attachment of assets and travel bans on company officials.
What changed: old rule vs new rule
| Old rule | New rule (from 1 June 2026) | |
|---|---|---|
| Deadline | 15th of the following month | 1st of the following month |
| Grace period | 15 days | None |
| Monitoring starts | After day 15 | From day 2 |
| Compliance threshold | 80% of wages on time | 85% of wages on time |
| Legal basis | Earlier WPS regulations | Ministerial Resolution No. 340 of 2026 |
In practice: if an employee worked during June 2026, their wage must be in their account — or at least 85% of it, see below — by 1 July 2026. Transfers processed on 2 July or later are late.
Who the new rule applies to
Ministerial Resolution No. 340 of 2026 applies to all private sector establishments registered with MoHRE in the UAE — mainland companies (LLC, sole establishments, branches of foreign companies) and free zones that operate under MoHRE's Wage Protection System (WPS), such as JAFZA and DMCC. Any employer whose workforce is registered under MoHRE work permits is in scope.
The financial free zones with their own employment regimes — DIFC and ADGM — sit outside MoHRE's WPS and run separate wage-protection frameworks, so this resolution does not apply to employers there directly. If you operate across both a MoHRE-registered entity and a DIFC or ADGM entity, only the former is governed by Resolution 340.
The 85% compliance threshold
The resolution sets a practical threshold: an employer is considered compliant if it transfers at least 85% of total wages due (raised from the previous 80%) by the 1st-of-month deadline. This is not a licence to routinely underpay. The remaining 15% must correspond to documented, lawful deductions, such as:
- Wages withheld for unauthorised absence
- Amounts subject to an active labour dispute
- Deductions for accommodation or other arrangements disclosed in the employment contract
- Wages for employees on documented unpaid leave
The key word is documented. MoHRE's electronic monitoring flags discrepancies, and an employer who cannot substantiate the shortfall faces the same escalation as one who pays nothing.
Penalty escalation: day 2 to day 21
The resolution replaces the previous flat-fine approach with a graduated schedule that begins on day 2 of non-payment and reaches maximum severity on day 21. The system operates automatically — there is no administrative hearing before enforcement begins.
Day 2
Monitoring & warning
MoHRE's electronic system flags the establishment and issues a written warning to the employer.
Day 5
Work permit suspension
New work permit applications are suspended and a formal violation notice is issued.
Day 11
Administrative fines
For repeat violations within six months: administrative fines applied on a scaled basis and a downgrade to the Third Category in MoHRE's establishment classification, affecting future government services.
Day 16
Labour disputes
MoHRE automatically registers labour disputes and suspends work permits for employers with 25 or more staff in targeted sectors — construction, transport and storage, security, cleaning, recruitment and domestic-worker offices.
Day 21
Maximum enforcement
In serious or repeat cases: precautionary attachment of assets, travel bans on the responsible individuals, and referral to the Public Prosecutor.
Categories excluded from the WPS calculation
Specific categories of workers are excluded when calculating whether the 85% threshold has been met:
- Employees who are party to an active labour dispute over their wages
- Employees absent without authorisation
- Employees on documented unpaid leave
- Foreign nationals paid outside the UAE under their contract terms
- Workers on short-term permits of less than three months
- Workers on fishing boats, employees of banks, and staff of places of worship
These exemptions are narrow and document-dependent. An employer cannot rely on them without contemporaneous records — leave approvals, dispute filings, contract clauses — that MoHRE can verify.
Payroll readiness checklist
The rule is live from 1 June 2026. The steps below should be completed before your first affected payroll run.
Confirm your WPS registration status
Verify in MoHRE's portal that your establishment is active on WPS and that employee bank details are current.
Move your payroll cut-off date
If your cycle closes on the 5th or 10th, you cannot reach employees by the 1st. Move the cut-off to no later than the 25th of the current month.
Confirm bank processing timelines
UAE banks typically need 1–2 business days to process WPS bulk transfers. Account for weekends and public holidays; if the 1st falls on a weekend, initiate by the 28th–29th.
Reconcile your WPS employee list
Ensure every current employee is enrolled and that salary amounts match employment contracts. Discrepancies trigger compliance flags.
Document all lawful deductions
For any employee paid below 100% of contractual salary, keep a file with the legal basis. This is your defence if MoHRE queries the 85% gap.
Generate the SIF file early each month
Prepare the salary information file ahead of the deadline rather than on the day. Our free WPS SIF file generator produces a SIF v1.1-compliant file in minutes.
Frequently asked questions
What is the exact UAE salary payment deadline from June 2026?
Wages for the previous month must be transferred via WPS no later than the 1st day of the following month. Initiate the transfer by the morning of the 1st — or the last working day before it — to ensure same-day processing.
Does the new rule apply to free zone companies?
It applies to all MoHRE-registered establishments, including free zones that operate under MoHRE's WPS such as JAFZA and DMCC. The financial free zones DIFC and ADGM run their own employment and wage-protection regimes and are not governed by Resolution 340.
What does the 85% rule mean?
An employer is treated as compliant if at least 85% of total wages due are transferred on time — a threshold raised from the previous 80%. The remaining 15% must be backed by documented, lawful deductions, not used as a routine shortcut.
What happens if salaries are paid late?
Penalties escalate automatically: a warning on day 2, work permit suspension on day 5, scaled fines and a classification downgrade on day 11, automatic labour disputes on day 16 for employers with 25 or more staff in targeted sectors, and — in serious or repeat cases — precautionary attachment of assets, travel bans and prosecution referral on day 21.
If the 1st is a weekend or public holiday, when is the deadline?
The resolution fixes the deadline at the 1st of the Gregorian month with no grace period and sets no separate rule for weekends or public holidays. Transfer on the last working day before the 1st so funds clear in time.
We pay some staff weekly or bi-weekly. Does this change anything?
The rule sets a ceiling — no later than the 1st — not a frequency requirement. All amounts for the previous month must cumulatively clear by the 1st. Any cycle that would settle on the 2nd or later must be adjusted.
How CoreLedger helps
We manage payroll and WPS for UAE businesses end to end: cut-off scheduling, SIF file preparation, bank transfer coordination, and the documentation MoHRE expects behind every deduction. Where late payment has already triggered enforcement, we help with compliance remediation and the steps to lift suspensions.
If you are unsure whether your current payroll cycle meets the new deadline, we will review it and map out exactly what to change before 1 June.