All You Need to Know About the Wages Protection System (WPS) in the UAE

Setting up a business in Abu Dhabi, Dubai or the wider UAE can be quite demanding. It is vital that you fulfill all legal obligations, especially when it comes to your company’s most valuable resource – your employees.

What is Wages Protection System (WPS)?

WPS system is an innovative electronic mechanism conducted by both the Ministry of Labor in the UAE and and the Central Bank of the UAE. With WPS, the Ministry of Labor can now track whether salaries are being been paid on time or not, and impose penalties on employers when necessary.

The rationale behind WPS

WPS system helps track whether salaries have been paid on time or not at real time, which will allow the ministry of Labor to immediately penalize non-compliant employers. This initiative has contributed to providing labor social protection and safe work environments because it protects the employees’ right to receive their wages on time – especially for low-skilled workers who may be likely subject to illegal and unfair practices.

Consequences of failing to join or adhere to WPS

Companies that do not enroll in the WPS or do not transfer the wages on time are not allowed to renew their employees’ work permits until all outstanding payments have been proven to be settled. If a company’s delayed payment exceeds one month, their right to renew their work permits will be cancelled.

How does ZenHR HRMS facilitate the process of implementing WPS?

ZenHR HRMS is a cloud-based Human Resources Management System designed to serve everyone from SME to Enterprise customers in the MENA market. ZenHR is completely localized to the MENA market, including all labor laws, expat regulations, and social security & tax laws.

Read the full ZenHR whitepaper and get all the information you need to ensure a successful WPS implementation at your company.

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