The United Arab Emirates are home to more than 200 nationalities, all of whom have come to try their luck in the peninsula. All these expatriates actively contribute to the local economy. For this reason, the
Ministry of Human Resources and Emiratisation (MOHRE) decided to intervene by facilitating the payment and distribution of salaries for private companies in the Mainland through a new system called “WPS.”
What is WPS?
WPS was introduced in 2019. It is an electronic salary transfer system that guarantees the timely payment of salaries in Dubai. It allows companies in the United Arab Emirates to pay their employees’ salaries every month through a bank, an approved financial institution, or an exchange house.
Please note that only private-sector companies registered in the Mainland are concerned and must open an account with one of the institutions mentioned above.
This system was developed by the Central Bank of the United Arab Emirates and allows the Ministry of Labour to verify that salaries are paid in full and within the specified deadlines.
Salary transfers can therefore be made through banks, exchange houses, and approved financial institutions authorized to provide this type of service.
All private companies registered with the ministry must join WPS, and any company that fails to do so will be refused any new work permits until the salaries have been paid in full.
How to join the WPS network
The first requirement is to be a company registered in the Mainland with the DED. A company registered in the Mainland must have a bank account with a local bank operating in the United Arab Emirates. The company is responsible for contacting a bank, exchange house, or financial institution accredited by the Central Bank to provide this service (at its choice). The two entities sign a contract and define the service fees and charges. Workers’ salaries will be transferred through WPS according to the deadlines specified in
Ministerial Resolution No. 788 of 2009.
How does WPS work in practice?
MOHRE has provided private-sector employers with a secure database that allows them to create salary files for their staff.
The process is very simple. To prepare the distribution of salaries to their employees, companies must send digital files to their respective banks. Each of these digital files contains confidential information about the employee’s salary, allowing MOHRE to ensure that employees’ salaries have been paid on time.
How do you withdraw your salary from the WPS system?
There are two ways to withdraw your salary from the WPS system:
- Withdrawal by the employee using a WPS card.
- Withdrawal through the employee’s personal bank account.
Withdrawal using a WPS card
If an employee does not have a personal bank account in the United Arab Emirates to receive their salary, the WPS card is an available option. It is very easy for companies registered in the WPS system to partner with exchange houses in the United Arab Emirates. This allows them to offer employees without bank accounts a WPS-compliant payroll solution. This WPS card can be used in different locations across all the emirates.
Through a bank ATM
For employees who have an open and active bank account in the United Arab Emirates, nothing could be simpler: they just need to present their bank card at an ATM to withdraw their salary. The process is simple and quick. As an employee, you will receive a text-message notification informing you that your salary has been credited to your bank account.
Fines and penalties
The government of the United Arab Emirates strictly penalizes all companies that fail to pay salaries on time. A salary is considered paid “late” if it is not paid within 10 days of the due date.
For example, suppose your salary is usually paid on the last day of each month. Your employer is required to pay your salary within the following 10 days, that is, before the 10th of the month. After that, your employer is subject to penalties and sanctions.
See our article:
“AED 50,000 fine if you do not pay salaries on time”
Do not even consider WPS fraud
When we talk about WPS fraud, we mean:
- Entering incorrect data into the WPS system for evasion or circumvention purposes: a fine ranging from AED 5,000 per worker to AED 50,000 if several employees complain.
- Failure to pay by the due date through WPS: AED 1,000 per employee.
- Forcing employees to sign false payslips showing that they have received their salaries: AED 5,000 per employee.
Salary payments are taken very seriously in the United Arab Emirates, and the government is working to implement new procedures to ensure that employees are not disadvantaged. Paying salaries on time is the assurance of stable employment relationships.
Our multidisciplinary team can assist you with the
WPS registration process and your employees’ payroll management. For more information, contact us:
support@merritt.group
