What is WPS in UAE- Introduction, Origin and Benefits

1. WHAT IS WPS IN UAE Introduction, Origin and Benefits Introduction, Origin and Benefits Start Slide

2. INTODUCTION The United Arab Emirates is a perfect blend of over 200 nationalities. More than half of its population is made up of expatriates who have crossed seas to start a new life here. They are working in various sectors, including education, finance, technology, research and science, fashion, media, and creativity, actively contributing to the nation’s economy. The government frequently introduces initiatives to facilitate a strong working and living environment for foreigners while promoting growth for them. At the same time, they ensure that the workplace and labour market in UAE remain transparent, safeguarding the interests of all parties involved. One such initiative is WPS UAE, which stands for the Wage Protection System in the UAE.

3. WHY IS SUCH SYSTEM NEEDED WPS is necessary in today’s era to monitor and prevent unfair practices by some employers. These could include unscrupulous actions such as refusal to pay wages on time, delaying payments, illegal use of funds, or not paying as per the contract or labour market standards. Having a robust system that oversees salary distribution minimizes such possibilities as there is close monitoring by the Ministry and the Central Bank. This results in a decrease in labour disputes and creates a strong and healthy relationship between employers and employees.

4. PURPOSE AND GOAL OF WPS UAE Providing a transparent and easy-to-use payment system Strengthen the work relationship and protecting the employer and employee rights Minimize the industry disputes and improve job security in private sector Offer and maintain a reliable database for salary files of companies Ensure that salaries are paid on time and accurately

5. Parties involved in WPS system UAE The WPS UAE targets various parties, which include: 1. Employees: They are individuals on the payroll of a private organization operating in the UAE. They must hold a job contract and a labour card issued by MOHRE. 2. Employers: The owners of private organizations operating in the UAE who are required to register with MOHRE and WPS. 3. Banks: Accredited banks and financial institutions through which salaries and wages are distributed. Employers must have a corporate bank account with these institutions. 4. Agents: Authorized banks, financial institutions, or exchange houses permitted by the Central Bank of UAE to provide salary payment services through the WPS in UAE. The Central Bank regularly updates the list of approved agents.

6. Registering with the WPS in UAE Corporate Bank Account: Hold a corporate bank account with a registered bank in the UAE. WPS Agent Contract: Enter into a contract with a WPS agent authorized by MOHRE, who will be responsible for the disbursement of wages. Timely Payment of Wages: Ensure wages are paid through the WPS by the deadlines outlined in Ministerial Decree No. 788, as amended in Ministerial Decree No. 739 of 2016. Minimum Payment Standards: Payment should cover 70% of all staff (excluding those on unpaid leave), and at least 75% of wages and salaries must be paid. Payment Costs: Any bank fees, expenses, provider charges, or other related payment costs must be borne by the employer.

7. How to register on WPS system UAE? After meeting the above requirements, visit the MOHRE website and set up your account. Once registered, you will receive login credentials for the WPS UAE portal. 1.Preparation and Submission of SIF 2. Salary Review by MOHRE and Central Bank 3. Payment Order Issued to WPS Agent 4. Money Transfer from WPS Agent to Employee Account.

8. Preparing the SIF as per WPS rules The backbone of the WPS UAE is updating the salary information file (SIFs), which is essential for using the WPS. Let us look into format of WPS SIF. Here is a step-by-step procedure of preparing a SIF for WPS system in UAE: First: Create a new excel sheet. Second: Enter EDR Third: Enter EVP Fourth: Enter SCR Fifth: Name and save the file

9. Penalties for noncompliance with WPS system UAE Employers must strictly follow the WPS regulations in the UAE. If they fail to do so, they shall face the fines and penalties. A. Fines for non-payment of dues For companies with more than 100 employees For companies with less than 100 employees B. Fine for providing false information C. Fine for forcing employees Maximizing the WPS value in UAE Other than meeting all the WPS requirements, a company can also maximize the value of WPS. How? By choosing the right agent! The right agent makes the process of WPS compliance smooth and error-free. Be it the preparation of SIF files in the right format or making the payments of salaries or wages on time, a reliable agent will help you through it and make the entire process fast, error-free, safe, and, lastly, cost-effective. Moreover, they can help you with employee bank accounts too. Thus, they can help create a secure, safe, and healthy work environment for your company and fostering positive relationships built on trust.

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