Since 1 June 2026, UAE salaries for the previous month must reach employees’ accounts through the Wage Protection System (WPS) by the 1st of each Gregorian month. Ministerial Resolution No. 340 of 2026 replaced the framework that had applied since 2022, and with it the mid-month grace period that most private-sector employers had built their payroll cycle around.
The rule is simple to state and harder to run: any salary that clears after the 1st counts as late. This guide covers what changed, how enforcement escalates and how to set up payroll so it clears on time every month.
What changed under Ministerial Resolution 340 of 2026?
MR 340 sets one salary due date for the whole private sector, raises the compliance threshold and shortens the time before enforcement begins.
Under the previous framework, Ministerial Resolution No. 598 of 2022, employers generally had until the 15th of the following month before enforcement began. That window absorbed month-end invoicing delays, slow client payments, banking holidays and last-minute corrections. It no longer exists.
The new framework introduces:
- A unified payday. Salaries for each month are due by the 1st of the following Gregorian month. June wages, for example, were due by 1 July.
- A higher compliance threshold. An establishment is treated as compliant if it transfers at least 85% of total wages due by the deadline, up from 80% under the previous rules. Any shortfall must be covered by documented, lawful deductions, or affected workers can claim the difference.
- Automated enforcement. MOHRE monitors salary transfers through WPS and flags late payments automatically, so enforcement starts without a manual review.
- Employer responsibility for outsourced payroll. Employers remain responsible for paying on time even when a third party runs payroll or submits WPS files for them.
Sources: Baker McKenzie, Clyde & Co, MOHRE.
What if the 1st falls on a weekend or public holiday?
Plan for salaries to clear before it. The Resolution sets the 1st as the due date with no stated extension for weekends or public holidays, and payment after that date is treated as delayed. Paying at the end of the preceding month is generally accepted, so the safest approach is to instruct your bank or WPS agent to clear funds before the 1st whenever it falls on a non-working day.
The penalty clock runs regardless of why a payment was late: a cash shortfall, a banking error or a rejected Salary Information File (SIF). Source: Mondaq.
Why is Day 5 the deadline that matters most?
On Day 5, MOHRE suspends new work permit issuance. For a business that employs people continuously, a single missed payroll freezes new starters, renewals, transfers and permit amendments until the wage issue is resolved.
The escalation timeline after a missed payment:
| Day | What happens |
|---|---|
| Day 1 | Electronic monitoring begins. Any unpaid salary is flagged. |
| Day 2 | Formal warning issued and logged on the establishment’s MOHRE compliance record. |
| Day 5 | New work permit issuance suspended. This affects every new starter, renewal and transfer. |
| Day 11 | Administrative fines applied. Repeat offenders are reclassified to the Third Category. |
| Day 16 | Individual or collective labour disputes registered automatically for affected workers. |
| Day 21 | For repeat violations at larger establishments, a travel ban on the person responsible and referral to the Public Prosecution. |
Day 21 is where liability can become personal. In the most serious cases, the travel ban applies to the named person in charge of the establishment, typically the owner, general manager or authorised signatory. The conditions for each step depend on establishment size and violation history, so confirm how they apply to your business with MOHRE or your legal adviser.
What makes the new deadline hard to meet?
Four practical issues make the 1st-of-the-month rule harder to run than it looks.
1. Cash flow timing. Companies that paid on the 10th or 15th had up to two weeks of incoming client payments to fund payroll. That buffer is gone. The full wage bill now has to be funded by the last working day of the month, which is a real liquidity squeeze for SMEs and project-based businesses on 30 to 60 day invoice cycles.
2. SIF accuracy. A rejected SIF counts as non-payment. A single IBAN mismatch, an outdated Labour ID or a salary that doesn’t match MOHRE’s records starts the same penalty clock as a genuinely missed payroll. Spreadsheet-driven SIF generation is now a compliance risk, not just an efficiency problem.
3. Deduction documentation. Loan repayments, salary advances and absence deductions all reduce the amount transferred. Where they take payment below the 85% threshold, they need formal, documented legal grounds before every SIF submission. Informal arrangements that worked under the old rules are now more likely to be flagged.
4. Multi-entity aggregation. Group employers in construction, transport and storage, security, cleaning, recruitment and domestic worker services are assessed across entities. Splitting workers across companies under the same ownership no longer dilutes risk, because unpaid wages count towards the 25- and 50-worker enforcement thresholds across the group.
How do you make sure payroll clears by the 1st?
Bring your internal payroll deadline well forward of month-end, validate SIF data before every run and make sure funding is in place before the last working day.
- Move payroll approval to the 25th. Internal cut-off, SIF generation and bank submission all need to finish before month-end. Bank processing is not instant, and a SIF submitted on the morning of the 1st may not clear until the next business day. Set the 25th as your internal sign-off date and work backwards.
- Audit SIF data before every run. Check every employee’s IBAN, Labour ID, contract salary and deduction codes against MOHRE records, and fix mismatches before submission.
- Formalise every deduction. Any deduction that brings take-home pay below the threshold needs documented legal authority. Build the paperwork once and reuse it monthly.
- Fund a payroll reserve. A dedicated, ring-fenced account holding at least one month’s wage bill stops a cash-timing gap from becoming a compliance failure. If a reserve isn’t viable, a pre-approved bank payroll credit facility does the same job.
- Subscribe to MOHRE alerts. A Day 2 warning leaves a narrow window to act before work permits are suspended on Day 5. Make sure the named person in charge of the establishment receives alerts directly.
- Review your payroll provider’s commitments. If you outsource WPS submission, confirm the agreement commits to funds clearing by the 1st, not only to submission. Legal responsibility for paying on time stays with the employer.
What should a payroll platform do under the new rules?
Under MR 340, payroll is a fixed monthly compliance deadline, so the platform has to handle calculation, validation, funding and records on a set schedule without manual workarounds.
At a minimum, a UAE payroll platform should:
- Calculate salaries and deductions against MOHRE-aligned rules, with the 85% threshold checked before submission.
- Validate SIF files before submission, flagging IBAN mismatches and Labour ID errors before they become non-payment events.
- Time funding and transfers so salaries clear by the 1st, allowing for bank processing times and non-working days.
- Keep every payslip, deduction record and bank confirmation in an audit-ready format.
Beyond that baseline, look for compliance monitoring as payments move, consolidated reporting for group employers with several entities, and clear service commitments on when funds will clear.
How RemotePass helps UAE employers meet the deadline
RemotePass runs UAE payroll for mainland businesses with the 1st-of-the-month deadline built into the process. Every customer has one dedicated account owner from day one, who manages the payroll calendar with you and chases missing information before cut-off.
What that covers:
- Earlier processing controls. Payroll cut-offs are set ahead of month-end, so approval, funding and submission finish before the 1st.
- Automated payroll calculations. Salaries, allowances and deductions are calculated against UAE rules, with the 85% threshold checked before submission.
- WPS file generation and validation. SIF files are generated and checked for IBAN, Labour ID and salary mismatches before they reach the bank.
- Funding and payment visibility. You can see when payroll has been funded, submitted and cleared.
- Audit trail and compliance records. Payslips, deduction records and bank confirmations are stored and ready for audit.
We work with UAE employers ranging from 5-person startups to 1,300-person multi-entity groups. The approach is the same at every size: clean data, validated SIF files, funding that clears on time and a full audit trail.
Frequently asked questions
When must UAE salaries be paid under the new WPS rules? Salaries for each month must reach employees’ accounts through WPS by the 1st of the following Gregorian month. This applies to all MOHRE-registered private-sector employers under Ministerial Resolution No. 340 of 2026, in force since 1 June 2026.
Can UAE employers still pay salaries on the 25th? Yes, if the payment covers that same month’s work. Paying before the 1st is generally accepted. What is no longer permitted is paying the previous month’s wages in the middle of the following month.
What happens if salaries are paid after the 1st? Monitoring starts on Day 1 and a formal warning follows on Day 2. New work permits are suspended from Day 5 and administrative fines apply from Day 11. Labour disputes can be registered from Day 16, with further measures for serious or repeat cases from Day 21.
Does the deadline move if the 1st falls on a weekend or public holiday? The Resolution does not state an extension for weekends or public holidays. Employers should arrange for salaries to clear before the 1st whenever it falls on a non-working day.
Who is responsible if payroll is outsourced? The employer. The Resolution confirms that employers remain responsible for on-time salary payment even when a third party runs payroll or submits WPS files on their behalf.
What is the 85% WPS compliance threshold? An establishment is treated as compliant if it transfers at least 85% of total wages due by the deadline. The threshold was 80% under the previous rules.
Want to know how MR 340 affects your payroll? Book a 30-minute WPS compliance review with our UAE payroll team. We’ll map your current payroll calendar against the new deadline, flag any structural risks and show you how automated WPS processing works in practice.
RemotePass is the global employment platform that becomes part of your team. We help companies employ, pay and support full-time employees and contractors across 150+ countries, with deep expertise in the UAE, Saudi Arabia and the wider GCC.
