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Complete Guide to Sponsoring Foreign Employees in UAE Mainland: Requirements, Process & Compliance

Last updated: March 17, 2025
Once you've successfully established your mainland business in the UAE and obtained your commercial license, your next critical step is building your team. For most UAE businesses, this means sponsoring foreign employees through a structured process governed by specific regulations.
This comprehensive guide explains the key requirements, procedures, and compliance considerations for sponsoring international talent to work legally in your UAE mainland company.

Table of Contents

  1. Understanding Employee Sponsorship in the UAE
  2. Key Regulatory Authorities
  3. Prerequisites for Employee Sponsorship
  4. UAE Employment Contract Requirements
  5. Step-by-Step Sponsorship Process
  6. Documentation Requirements
  7. Employee Quota Systems
  8. Costs and Financial Obligations
  9. Compliance Considerations
  10. Frequently Asked Questions

Understanding Employee Sponsorship in the UAE

Employee sponsorship in the UAE mainland refers to the legal relationship established between an employer (sponsor) and a foreign employee. As the sponsor, your company assumes legal responsibility for the employee's residence and work status in the country.

Key Sponsorship Principles

  • Employer as Legal Sponsor: Only licensed mainland companies can sponsor foreign employees
  • Regulatory Oversight: Multiple government entities regulate the sponsorship process
  • Skill-Based Approval: Work permits are granted based on the employee's qualifications and the UAE's workforce needs
  • Contractual Foundation: Standardized employment contracts form the legal basis of employment
  • Quota Limitations: Companies can sponsor a specific number of employees based on various factors

Key Regulatory Authorities

The employee sponsorship process involves coordination with several government entities:

Federal Authorities

  • Ministry of Human Resources and Emiratisation (MOHRE): The primary federal authority overseeing labor relations, issuing work permits, and regulating employment contracts
  • Federal Authority for Identity, Citizenship, Customs and Port Security (ICP): Handles immigration-related matters including residency permits

Emirate-Level Authorities

The General Directorate of Residency and Foreigners Affairs (GDRFA) in each emirate processes residence visa applications:
  • GDRFA Abu Dhabi
  • GDRFA Dubai
  • GDRFA Sharjah
  • GDRFA Ajman
  • GDRFA Umm Al Quwain
  • GDRFA Ras Al Khaimah
  • GDRFA Fujairah
Working with each authority requires understanding their specific requirements and procedures, which may vary slightly between emirates.

Prerequisites for Employee Sponsorship

Before sponsoring employees, your company must meet certain criteria and prepare specific elements:

Company Requirements

  • Valid Trade License: Your company must have an active commercial license
  • Physical Office: Verified business premises appropriate to your license type
  • eSignature Card: Digital authentication for MOHRE transactions
  • Establishment Card: Also known as a "firm card" issued by the relevant GDRFA

Employee Eligibility Criteria

MOHRE evaluates potential employees based on:
  1. Professional Qualifications: The employee must possess skills or academic qualifications needed in the UAE
  2. Legal Entry Status: The employee must have lawfully entered the country
  3. Local Talent Assessment: Verification that the position cannot be filled by a UAE national

UAE Employment Contract Requirements

The UAE has introduced stringent requirements for employment contracts to protect both employers and employees:

Standardized Contract Framework

  • Unified Contract Template: MOHRE requires the use of standardized employment contracts
  • Employment Offer Stage: An official employment offer must be issued before the work permit application
  • Bilateral Agreement: Both employer and employee must sign the offer document
  • MOHRE Registration: The signed offer must be registered with MOHRE before proceeding with visa applications

Contract Additions and Modifications

Additional clauses may be added to the standard contract only if they:
  • Comply with MOHRE legal requirements
  • Do not conflict with existing clauses in the standard contract
  • Receive explicit MOHRE approval

Multilingual Contract Options

To ensure employee understanding, contracts are available in 11 languages including:
  • Arabic
  • English
  • Hindi
  • Urdu
  • Bengali
  • Chinese
  • Nepalese
  • Filipino
  • And others

Compliance Note

Employers who fail to ensure employees understand contract annexes before signing may face penalties of AED 20,000 for submitting incorrect data to MOHRE.

Step-by-Step Sponsorship Process

Sponsoring an employee in the UAE mainland involves a two-phase process:

Phase 1: Work Permit Application (MOHRE)

  1. eSignature Acquisition:
  • Apply for your company's eSignature card through MOHRE
  • Submit required company documentation
  • Undergo inspection of business premises
  • Receive eSignature authentication
  1. Employment Offer Issuance:
  • Create the employment offer using MOHRE's standard template
  • Include all required terms and conditions
  • Have both parties sign the offer document
  • Register the offer with MOHRE
  1. Preliminary Work Permit Application:
  • Submit application through MOHRE's online portal using your eSignature
  • Upload required documentation
  • Pay applicable fees
  • Receive preliminary approval

Phase 2: Residency Visa Application (GDRFA)

  1. Entry Permit Processing:
  • Apply for entry permit (if employee is outside UAE)
  • Receive electronic entry permit
  • Ensure employee enters UAE using this permit
  1. Medical Fitness Testing:
  • Schedule employee's medical examination at approved health centers
  • Obtain medical fitness certificate
  • Complete Emirates ID application
  1. Residency Stamp Issuance:
  • Submit residency application to GDRFA
  • Complete biometric capture
  • Pay residency fees
  • Receive residency stamp in employee's passport
  1. Labor Card Finalization:
  • Return to MOHRE portal to complete work permit
  • Download electronic labor card
  • Process completed

Documentation Requirements

Prepare the following documents for a smooth sponsorship process:

Company Documents

  • Trade license copy
  • eSignature card
  • Establishment card (from GDRFA)
  • Office lease agreement (Ejari/Tawtheeq)
  • Company profile or activity details

Employee Documents

  • Passport copy (valid for at least 6 months)
  • Recent color photograph with white background
  • Academic certificates/professional qualifications
  • Professional licenses (for regulated professions)
  • Previous employment certificates
  • Completed and signed job offer/employment contract

Special Documentation for Regulated Professions

Certain professions require additional approval from regulatory bodies:
  • Healthcare Professionals: Approval from health authorities
  • Education Professionals: Approval from education authorities
  • Legal Professionals: Approval from justice departments
  • Engineers: Approval from relevant municipalities or engineering bodies
All academic certificates and professional qualifications must be:
  • Attested by the UAE Embassy in the country of issuance
  • Further authenticated by the UAE Ministry of Foreign Affairs and International Cooperation

Employee Quota Systems

The number of employees you can sponsor depends on your company's approved quota:

Quota Determination Factors

  • Company Legal Form: Different structures have different allocation frameworks
  • Office Space Size: Physical premises size impacts employee capacity
  • Business Activity: Nature of business affects staffing requirements
  • Operational Needs: Demonstrated business requirements

eQuota System

As of 2022, the UAE has implemented an electronic quota system based on Cabinet Resolution No. 203:
  • Dynamic Allocation: Quotas are determined through an automated classification system
  • Business Classification: Companies are categorized into tiers affecting quota allocation
  • Compliance History: Previous labor violations may impact quota assignments
  • Emiratization Commitment: Meeting nationalization targets can increase available quotas

Quota Adjustment Process

You can request a quota increase by:
  1. Submitting an application through MOHRE's portal
  2. Providing business justification for additional staff
  3. Demonstrating compliance with current regulations
  4. Undergoing additional premises inspection if necessary

Costs and Financial Obligations

Sponsoring employees involves several financial commitments:

Government Fees

  • eSignature Card: Approximately AED 2,000 (valid for 2 years)
  • Establishment Card: AED 1,000-2,000 depending on the emirate
  • Work Permit Application: AED 300-500
  • Employment Entry Permit: AED 1,500-3,000
  • Medical Testing: AED 250-750 depending on gender and emirate
  • Emirates ID: AED 100-370 depending on validity period
  • Visa Stamping: AED 460-600 depending on the emirate
  • Labor Card: AED 500-700

Bank Guarantee

  • Mandatory Deposit: AED 3,000 per employee
  • Purpose: Financial security for employee rights
  • Refundable: Returnable upon proper visa cancellation
  • Special Cases: Certain company categories may be exempt

Insurance Requirements

  • Health Insurance: Mandatory for all sponsored employees
  • Coverage Level: Minimum government-specified standards
  • Verification: Required during visa processing

Important Note on Cost Allocation

According to UAE Labor Law, all sponsorship costs must be borne by the employer. It is illegal to:
  • Deduct visa fees from employee salaries
  • Request reimbursement for sponsorship costs
  • Withhold any amount related to work permits or visas

Compliance Considerations

Maintaining compliance with UAE labor and immigration laws is essential:

Key Compliance Requirements

  • Visa Validity Monitoring: Track expiration dates of employee visas
  • Contract Adherence: Maintain compliance with terms outlined in contracts
  • Wage Protection System: Register with the WPS for salary payments
  • Employee Records: Maintain updated employee files
  • Working Hours Regulations: Adhere to legal working hour limitations
  • Annual Leave Provision: Ensure proper leave allocation
  • End of Service Benefits: Calculate and provide gratuity payments

Common Compliance Pitfalls

  • Delayed Renewals: Failing to renew visas and permits on time
  • Unauthorized Work: Allowing employees to begin work before receiving proper documentation
  • Contract Violations: Changing terms of employment without proper documentation
  • Documentation Gaps: Incomplete or outdated employee records
  • Insurance Lapses: Insufficient health insurance coverage

Penalties for Non-Compliance

Violations of sponsorship regulations can result in:
  • Financial penalties (up to AED 50,000 per violation)
  • Company classification downgrades
  • Quota reductions
  • Blacklisting from future sponsorship applications
  • Business license suspension

Frequently Asked Questions

Can an employee start working based on preliminary approval?

No. Despite receiving preliminary work permit approval from MOHRE, an employee can only legally begin working after obtaining the residency visa stamp in their passport. Working before completing the full process is considered a violation subject to penalties.

Who bears the cost of employment sponsorship?

The employer is legally required to bear all costs associated with employee sponsorship. No employer is permitted to deduct visa fees, work permit costs, or any related expenses from an employee's salary.

How long is the work permit valid?

Initial work permits are valid for 60 days, during which the employer must complete all remaining steps including medical testing, Emirates ID application, and residency stamp issuance. If these steps are not completed within the 60-day window, the work permit is automatically canceled, requiring a new application.

Can I sponsor employees if I have labor violations?

Labor violations may significantly impact your ability to sponsor new employees. MOHRE considers compliance history when approving new work permits and allocating quotas. Resolving any existing violations should be prioritized before attempting to sponsor additional employees.

What happens if an employee fails the medical test?

If an employee fails the medical fitness test due to certain conditions, the preliminary work permit will be canceled. The employee may need to leave the country, depending on their current visa status. Some conditions may be eligible for exemptions or additional testing.

How soon can a new employee transfer their visa to my company?

For employees already in the UAE, the ability to transfer sponsorship depends on their current visa status, employment contract type, and other factors. Recent regulatory changes have made transfers more flexible, but specific conditions apply based on the employee's situation.

Can I recover the bank guarantee when an employee leaves?

Yes, the AED 3,000 bank guarantee is refundable when you properly cancel the employee's visa and labor card. It's important to follow the formal cancellation process through both MOHRE and GDRFA to ensure the guarantee can be recovered.

Streamlining Your Employee Sponsorship Process

Navigating the UAE's employee sponsorship system requires attention to detail, thorough preparation, and understanding of the regulatory landscape. While the process may seem complex, a systematic approach can help ensure smooth onboarding of your international talent.
For businesses looking to minimize administrative burden and ensure full compliance, professional PRO (Public Relations Officer) services can manage the entire sponsorship process from initial work permit application through to residency visa issuance.
By properly following the sponsorship procedures and maintaining ongoing compliance, your mainland UAE business can build a strong, diverse workforce while avoiding regulatory complications that could impact your operations.
Need assistance with employee sponsorship in the UAE? Our team of PRO specialists can manage the entire process for you, ensuring full compliance with all regulatory requirements. Book your free consultation today.
2025-02-20 11:10