WPS SERVICES

What is Wage Protection System UAE: Introduction, Origin, and Benefits

The Wage Protection System (WPS) was introduced in July 2009 under Ministerial Decree No. 788, as a joint initiative by the Ministry of Human Resources and Emiratisation (MOHRE) and the Central Bank of the UAE. It is an electronic salary transfer system designed to ensure timely and full payment of wages to employees in the private sector. The WPS requires employers to process employee salaries through banks, exchange houses, and financial institutions authorized by the Central Bank. This system enhances transparency in salary payments and protects workers’ rights by ensuring that wages are paid in accordance with the terms agreed upon in employment contracts. By October 2015, approximately 3.5 million of the 4.6 million migrant workers in the UAE were benefiting from the WPS, according to the International Labour Organization (ILO).

• For Employees: Ensures timely payment of agreed wages, reducing labor disputes and enhancing job security.
• For Employers: Streamlines payroll processes, provides legal proof of salary payments, and helps maintain compliance with labour laws

Fines and Penalties for Non-Compliance

Employers who fail to comply with WPS regulations may face penalties, including:

• Suspension of work permit issuance.
• Fines ranging from AED 5,000 per affected worker, up to AED 50,000 for multiple violations.
• Downgrading of the company’s classification in the MOHRE system.
• Legal action and potential suspension of the company’s operations.

At DKM we ensure that all WPS services are completed on timely basis strictly adhering to the UAE laws and regulations