UAE Overtime Calculation: Complete Employer Guide
Comprehensive guide to UAE overtime calculation, rates, limits, and compliance requirements under Federal Decree-Law No. 33 of 2021. Includes formulas and examples.
Quick Summary: Comprehensive guide to UAE overtime calculation, rates, limits, and compliance requirements under Federal Decree-Law No. 33 of 2021. Includes formulas and examples.
Overtime compensation is a mandatory requirement under UAE Labor Law. Employers must pay premium rates for work beyond standard hours. Understanding overtime rules is essential for payroll compliance.
This guide explains overtime calculation, rates, and limits according to MOHRE regulations.
| Aspect | Details |
|---|---|
| Legal Basis | Articles 17-19, Federal Decree-Law No. 33/2021 |
| Standard Hours | 8 hours/day, 48 hours/week |
| Maximum Overtime | 2 hours per day |
| Normal Overtime Rate | 125% of hourly wage |
| Night/Holiday Rate | 150% of hourly wage |
Standard Working Hours
Daily and Weekly Limits
| Limit | Hours |
|---|---|
| Maximum per day | 8 hours |
| Maximum per week | 48 hours |
| Ramadan (reduced) | 6 hours/day |
Rest Periods
- Daily break: Minimum 1 hour after 5 consecutive hours
- Break not counted: Rest time not included in working hours
- Weekly rest: Minimum 1 day per week (usually Friday)
What Triggers Overtime
| Situation | Overtime? |
|---|---|
| Working more than 8 hours/day | Yes |
| Working more than 48 hours/week | Yes |
| Working on weekly rest day | Yes |
| Working on public holiday | Yes |
| Working during Ramadan beyond 6 hours | Yes |
Overtime Rates
Normal Overtime (125%)
Applies to overtime work during:
- Normal working days
- Daytime hours (outside 10 PM - 4 AM)
Rate: Regular hourly wage + 25% premium
Night/Holiday Overtime (150%)
Applies to overtime work during:
- Night hours (10 PM - 4 AM)
- Public holidays
- Weekly rest days
Rate: Regular hourly wage + 50% premium
Rest Day Without Day Off (200%)
If employee works on rest day and doesn't receive compensatory day off:
- Option 1: 150% of wage + day off
- Option 2: 200% if no day off given
Maximum Overtime Limits
| Limit | Details |
|---|---|
| Daily maximum | 2 additional hours |
| 3-week maximum | Total 144 hours (including regular time) |
Calculation Formula
Step 1: Calculate Daily Wage
Daily Wage = Monthly Basic Salary / 30Step 2: Calculate Hourly Wage
Hourly Wage = Daily Wage / 8Step 3: Calculate Overtime Rate
For Normal Overtime (125%):
Overtime Hourly Rate = Hourly Wage x 1.25For Night/Holiday Overtime (150%):
Overtime Hourly Rate = Hourly Wage x 1.50Step 4: Calculate Total Overtime Pay
Overtime Pay = Overtime Hourly Rate x Number of Overtime HoursWhat Salary Components are Included
Included: Basic salary only
NOT Included:
| Component | Included? |
|---|---|
| Housing allowance | No |
| Transportation allowance | No |
| Food allowance | No |
| Commission | No (unless contractually basic) |
| Bonuses | No |
Calculation Examples
Example 1: Normal Daytime Overtime
Employee Details:
- Basic monthly salary: AED 6,000
- Overtime hours worked: 10 hours (normal daytime)
Calculation:
Daily wage = 6,000 / 30 = AED 200
Hourly wage = 200 / 8 = AED 25
Normal OT rate = 25 x 1.25 = AED 31.25
Overtime pay = 31.25 x 10 = AED 312.50Example 2: Night Overtime
Employee Details:
- Basic monthly salary: AED 9,000
- Overtime hours: 6 hours (worked between 10 PM - 4 AM)
Calculation:
Daily wage = 9,000 / 30 = AED 300
Hourly wage = 300 / 8 = AED 37.50
Night OT rate = 37.50 x 1.50 = AED 56.25
Overtime pay = 56.25 x 6 = AED 337.50Example 3: Public Holiday Work
Employee Details:
- Basic monthly salary: AED 12,000
- Worked full 8 hours on National Day
Calculation:
Daily wage = 12,000 / 30 = AED 400
Hourly wage = 400 / 8 = AED 50
Holiday rate = 50 x 1.50 = AED 75
Holiday pay = 75 x 8 = AED 600Example 4: Mixed Overtime
Employee Details:
- Basic monthly salary: AED 15,000
- 5 hours normal overtime
- 3 hours night overtime
Calculation:
Daily wage = 15,000 / 30 = AED 500
Hourly wage = 500 / 8 = AED 62.50
Normal OT: 62.50 x 1.25 x 5 = AED 390.63
Night OT: 62.50 x 1.50 x 3 = AED 281.25
Total overtime pay = AED 671.88Exempt Employees
Categories Not Subject to Overtime
| Category | Reason |
|---|---|
| Senior managers | Decision-making authority |
| Supervisory staff | Oversight responsibilities |
| Executives | Management positions |
| Specific roles | Where job nature requires flexibility |
Characteristics of Exempt Positions
- Hold significant decision-making authority
- Oversee teams or departments
- Have control over operations
- Job requires inherent flexibility in hours
Gray Areas
For positions in between:
- Review job description and actual duties
- Consider level of autonomy
- Check industry standards
- Consult MOHRE if unclear
Overtime During Ramadan
Reduced Working Hours
During Ramadan:
- Normal hours reduced to 6 hours/day
- Applies to all employees (Muslim and non-Muslim)
- Full salary maintained despite reduced hours
Overtime After Reduced Hours
Any work beyond 6 hours during Ramadan is overtime:
Ramadan normal hours: 6 hours
Overtime threshold: After 6 hours
Overtime rates: Same as normal (125%/150%)Compensatory Time Off
Instead of overtime pay, employer may offer:
- Day off in lieu for rest day work
- Must be agreed with employee
- Typically at same rate (1:1)
Employer Obligations
Must Do
| Obligation | Details |
|---|---|
| Limit overtime | Maximum 2 hours/day |
| Pay correctly | Proper overtime rates |
| Keep records | Document all overtime |
| Protect employees | Ensure adequate rest |
Cannot Do
| Prohibited | Details |
|---|---|
| Excessive overtime | Beyond legal limits |
| Unpaid overtime | Must compensate |
| Forced overtime | Must be voluntary (with exceptions) |
| Falsify records | Must be accurate |
Penalties for Violations
| Violation | Penalty |
|---|---|
| Exceeding maximum hours | AED 1,000 - AED 50,000 |
| Non-payment of overtime | Up to AED 20,000 |
| Falsifying records | Additional penalties |
Best Practice: Implement time tracking systems, pre-approve overtime, monitor patterns, and pay promptly with regular payroll.
Frequently Asked Questions
Automate Overtime Tracking
NeuralHR calculates overtime automatically, applies correct rates, and ensures compliance with UAE labor law.
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NeuralHR Team
VerifiedUAE HR Compliance Experts
Our team of HR professionals and legal experts specializes in UAE labor law compliance, with extensive experience helping businesses navigate MOHRE regulations, Emiratisation requirements, and workforce management in the UAE and GCC region.
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