Overtime is one of the easiest things to get wrong in UAE payroll — and one of the most common causes of disputes. Here are the rates the law sets out and how to apply them.
The basic rule
Work beyond your normal daily hours is overtime, paid at your normal hourly wage plus a premium. Overtime is generally capped at two hours per day.
The premiums
- Standard overtime: hourly wage + 25%.
- Overtime between 10pm and 4am: hourly wage + 50% (this typically doesn't apply to shift workers whose normal shift falls at night).
- Work on a rest day: normal pay + 50%, or a compensatory day off.
- Work on a public holiday: a compensatory day plus additional pay.
A worked example
Overtime is always calculated on the basic salary, excluding allowances. The commonly used method is to divide the basic monthly wage by 30 days and then by 8 hours. For a basic wage of AED 6,000: AED 6,000 ÷ 30 ÷ 8 = AED 25 per hour. Two hours of standard overtime would then be AED 25 × 1.25 × 2 = AED 62.50. Night overtime between 10pm and 4am, for the same two hours, would be AED 25 × 1.5 × 2 = AED 75.
Why accurate capture matters
Overtime is only fair — and only compliant — if it's captured accurately. Rounding, missed punches or manual timesheets quietly cost employees money or expose employers to claims. TimeChart's attendance system records exact hours and calculates overtime automatically.
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Schedule a free demoPlease note: This article is general information, not legal advice. UAE labour rules are updated periodically — always confirm the current details with the Ministry of Human Resources & Emiratisation (mohre.gov.ae) or a qualified professional. The hourly-rate method above is illustrative; confirm the correct basis for your contracts.