How the Overtime calculates in UAE for employees

overtime calculates in UAE

Overtime Calculates in UAE- The overtime is a pay to the employees for working additional hours over the normal working hours. It is the normal practice in many countries, employees work for 8hrs a day and 48hr a week. If someone calls for work an extra hour than it considers the overtime.

Every nation has a labour law, the purpose of it is to prevent the employee from being exploited by their respective employers.

The overtime law also comes into the labour law which designed to prevent employer forcing employees working excessively long hour.

In this post, I want to discuss the employees’ right and privilege which has granted by UAE Labour Law in term of a working hour and provision of overtime.

I found many people who are working in UAE majority of unskilled workers, don’t know how the company calculates their overtime and other compensations. Not only the unskilled worker there are still many professionals have confused on this matter too.

Although the labour law in UAE has elaborated clearly for the overtime pay many companies do not pay as the law.

According to the labour law of the UAE. The company can not force you to perform the overtime. It’s required your consent to work the extra hours’ if a company needs you to do so.

In the UAE, there are bad and good companies have existed, some are good which pays according to the labour law, but, some bad companies pay lower than the labour law.

Overtime Calculates in UAE (Bad company )

Per day salary = basic salary/30days

Per hour salary = basic salary/30days/8hrs

Overtime Calculates in UAE (Good company )

Per day salary = basic salary/26days

Per hour salary = basic salary/26days/8hrs

These above differences seem, not all companies follow the labour law in the UAE. You would find the vary on overtime pay between you and your counterpart who works in other company even though both of you have the same basic salary.

Now, let’s look at the provision of UAE labour law, how should your company needs to calculate the overtime for the employees.

The overtime will pay higher than normal hours of work but it is important for you to know. Is it according to the Law or not?

Most of the jobs in UAE, the companies require an extra hour of work from the employees. The labour law does concern to all types of works, therefore, It is very essential for you to know whether you are entitled overtime or not.

As per the labour law of the United Arab Emirates, following position are not applicable for overtime but they may receive huge bonuses in terms of contributing to the company’s growth by working extra hours.

Overtime is not applicable
  1. Senior positions.
  2. Administrative supervisors.
  3. The crew of naval ships and marine employees.
What is the Official work hours in UAE?
  1. 8 hours a day or 48 hours a week unless an employee works in a trade, hotel, and security guard the working hours can be increased 9 hours a day maximum.
  2. Travelling between work and home and the 1-hour break is not included in overtime.
  3. 8 hours a day is reduced to 6 hours during the Ramadan.
  4. If an employer wants an employee to work overtime, this can only be done with the employee’s consent. The employer cannot force you to work overtime.
  5. The extra overtime hours shall not exceed 2hrs per day meaning the maximum of 11hrs.
  6. If the nature of a job requires overtime the employee shall be paid overtime, adding 25% on the normal working hours rate. If you work between 9 pm-4 am then the pay rate is plus 50% on the normal working hrs.

Overtime calculation on a normal day;

Monthly overtime pay = basic salary/26days/8hrs X over-time amount+25%.

supposed your basic salary is 2600 AED and you did overtime 120 hours in a month your salary will be. (Normal 1 hour pay + 25% = 1hrs over-time)

2600/26/8 = 12.5 normal hour pay

12.5+12.5 X 25% =15.62 per hour over-time.

Now total overtime hrs X per hrs over-time pay

120 X 15.62 = 1874 total overtime pay

Now basic salary + total overtime pay

2600+ 1874.4 = AED 4474.4 monthly payment.

short formula:– Basic sakary+ basic salary/26/8 X total hrs overtime X 1.25 = Monthly salary.

2600+2600/26/8 X 120 X1.25 = 4474.4

An employee Works on Friday or off-day

If circumstances require the employee to work on Friday or his off day he must granted either another day off or receive a basic salary in addition 50% as over-time.

Short formula:– basic salary /26/8 X total overtime hrs X 1.5 = total over-time pay

2600/26/8 X 12 X 1.5 = 225 (12hrs OT payment).

An employee Works on a public holiday.

Where the circumstances of the work make it necessary for a worker to work on public holidays or rest day in respect of which he/she is entitled to full or partial pay, he shall be granted compensatory leave in respect of such days, together with a bonus equal to 50cent of his pay.

If he is not compensated for such days by leave, his employer shall pay him a bonus equal to 150% of his basic payment in respect of the days worked.

Short formula: 

2600/26/8 X total overtime hrs X 1.5 + 1 day off = total over-time pay

2600/26/8 X 8 hrs X 1.5 = 125 (8hrs pay +1day off)

If the company did not give you off so you are entitled to 150% compensation

2600/26/8 X 8hrs X 2.5 = 250  (8 hrs over-time)

The above Salary calculation as per the labour law of UAE. If the employer fails to pay, you can make a complaint to the MOL ( Ministry Of Labour).

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