Question:
What is the difference between remuneration and basic salary in the UAE?
Answer:
Federal Decree Law No. 33 of 2021 sets the two definitions: wage (remuneration) and basic wage.
Basic Wage: the remuneration stipulated in the employment contract, which is given to the worker in return for his work under the employment contract, on a monthly, weekly, daily, hourly or piecework basis, and does not include any other allowances or benefits in kind.
Wage (remuneration): basic wage + the cash payment and benefits in kind that are decided for the worker under the employment contract or the Law, and may include:
- the benefits in kind that the employer is obligated to provide to the worker, or their cash equivalent, if they are prescribed as part of the remuneration in the employment contract or the establishment’s system,
- the allowances that the worker is entitled to in return for the effort he exerts or the risks he is exposed to in the performance of his work or any other reasons,
- the allowances given to meet the cost of living,
- a percentage of sales or a percentage of the profits paid ...