Employer of Record in the United Arab Emirates: what one employee really costs

Questions people ask before booking a demo

How much does an employer of record cost in the UAE?

For one foreign employee at US$65,000 gross a year, the only statutory employer charge is the end-of-service gratuity: 21 days of basic wage for each of the first five years, which is 5.75% of basic pay, or about 2.88% of the whole package where basic pay is half of it. That is roughly US$156 a month, so the employer cost before any provider fee is at least about US$5,572 a month. Published employer-of-record fees then run from US$199 to US$699 per employee per month, which puts the all-in cost between about US$5,770 and US$6,270 a month. Work permit, residence visa and health cover sit outside that figure because they are amounts per head rather than a share of pay.

Do employers pay social security for expatriates in the UAE?

No. Article 51(1) of the 2021 Labour Relations Decree-Law sends the national worker to the pension and social security legislation, and article 51(2) gives the foreign worker an end-of-service gratuity in its place, so the expatriate an employer of record normally places generates no employer pension contribution. The national case sits in Federal Decree-Law No. 57 of 2023, which defines the insured as a national: article 4 sets the employer share at 15% of the subscription account salary, and the Government bears 2.5 points of it for a private-sector employer on subscription salaries below AED 20,000, so the employer pays 12.5% below that line. That leaves the gratuity as the single statutory employer cost on an expatriate payroll.

How is UAE end-of-service gratuity calculated?

On the basic wage alone, which article 1 of the Decree-Law defines as the contract amount excluding every allowance and benefit in kind. Article 51(2) gives 21 days of that basic wage for each of the first five years of service and 30 days for each year after; article 51(3) pays parts of a year in proportion once a full year is complete; article 51(6) caps the total at two years' wage. Because allowances are excluded, two employees on the same total package can produce very different gratuities, and that is why this page publishes a floor rather than a single number.

Does the DIFC change what an employee costs?

Yes, in two ways. Inside the Dubai International Financial Centre, article 66(7) of DIFC Employment Law No. 2 of 2019 replaces the accruing gratuity with a monthly payment into a Qualifying Scheme of at least 5.83% of monthly basic wage for the first five years and 8.33% thereafter, so the money leaves the business as the entitlement builds instead of waiting for a departure. And article 66(3)(a) sets a floor the federal law does not have: the basic wage may not be less than half the annual wage. A DIFC employer therefore cannot reduce the gratuity by loading the package with allowances, which is exactly what makes the mainland figure on this page a floor.

How much annual leave does UAE law require?

Article 29 gives at least 30 days of paid annual leave for each year of full service, two days for each month of service between six months and one year, and a pro rata entitlement for the final part-year where employment ends before the balance is used. Those are leave days as the Decree-Law counts them rather than working days, so the working-day equivalent depends on the working week in the contract. Public holidays are set by Cabinet resolution under article 28 rather than by the Decree-Law itself. Cabinet Resolution No. 27 of 2024 applies one list to the public and private sectors, and in 2026 it came to 13 days: New Year, four days for Eid Al Fitr because Ramadan ran to its thirtieth day, Arafat Day and three days of Eid Al Adha, the Hijri New Year, the Prophet's birthday and two days for National Day. In a year when Ramadan lasts 29 days the count is 12, and a holiday that falls on a weekend is not moved to another day.