Wage Protection System WPS UAE Guide 2025
- Aamer Jarg
- 3 hours ago
- 5 min read
Introduction
The Wage Protection System, commonly known as WPS, is the UAE’s official salary transfer platform regulated by the Ministry of Human Resources and Emiratisation in partnership with the Central Bank. It has been the backbone of payroll compliance in the UAE private sector since it started in July 2009 with Ministerial Decree 788. (Central Bank UAE)
WPS ensures that employees receive their wages on time and in full, in accordance with their employment contracts. For employers, it provides a structured and transparent payroll trail that protects them from labor disputes and legal complications.
As the UAE continues strengthening labor policies through new resolutions like Ministerial Resolution 598 of 2022, every employer must understand how WPS works and what complete compliance looks like in 2025. (U.ae)
What WPS Does and Why It Matters
Purpose of WPS
WPS maintains a verified database of salary transactions for private sector employees. Before releasing any payment, MOHRE and the Central Bank verify the Salary Information Files that employers upload. This prevents practices such as delays, underpayment, false salary reporting, or using nonapproved payment channels.
Benefits for Employees
Guaranteed timely payment of wages
Protection against disputes, unauthorized deductions, or withheld salaries
Documented proof of paid wages
Greater financial security and transparency
Benefits for Employers
A streamlined payroll process
Legal proof of payment in case of disputes
Reduced compliance risk
Avoidance of penalties or work permit restrictions
Better trust and retention among staff
By 2015, the International Labour Organization reported that more than three million workers in the UAE were protected under the WPS framework. Coverage has only expanded since then. (ILO)
UAE WPS Registration Requirements for Employers
Before registering for WPS, an employer must meet the following conditions:
Maintain a corporate bank account in the UAE.
Sign an agreement with a WPS agent. The recipient can be a bank, exchange house, fintech provider, or any authorized financial institution.
by the Central Bank.
Commit to paying salaries within deadlines specified by Ministerial Decree 788 and subsequent regulations.
Ensure that at least seventy percent of employees are covered and that at least seventy-five percent of wages are paid.
Please ensure that all WPS-related fees or charges are covered
Use the MOHRE e-channel or WPS portal to upload and manage salary files.
Employers operating in the Jebel Ali Free Zone are also required to comply with WPS.
How WPS UAE Works Step by Step
1. Companies Submit the SIF and Deposit Funds
The process begins with the employer preparing the Salary Information File. This file includes all salary details, such as bank account numbers, labor card numbers, basic pay, allowances, deductions, and the salary period.
After preparing the file, the employer submits the SIF to an authorized WPS agent, which can be a bank, exchange house, or financial institution. Employers also deposit the required salary funds with the agent so the payment can be processed.
2. SIF Is Sent for Approval via WPS
The authorized WPS agent forwards the SIF to the WPS system. At this stage, the file enters the official review workflow managed by MOHRE and the Central Bank.
3. Files Checked by MOHRE
MOHRE reviews the Salary Information File to confirm that the salaries match employment contract terms. Checks include accuracy of employee data, payment amounts, and compliance with wage rules. If there are errors, MOHRE notifies the employer to correct and resubmit the file.
4. Files Authenticated by the Central Bank
Once MOHRE completes its checks, the Central Bank authenticates the file. This step ensures that all payroll information meets banking and regulatory standards before payments can be authorized.
5. Payment Authorisation Is Given to the Agent
After both MOHRE and the Central Bank approve the SIF, a payment authorization is issued to the WPS agent. This provides the agent permission to release the salary funds.
6. Funds Are Transferred to Employees
The WPS agent transfers the approved salaries to employee bank accounts or WPS payroll cards. Employees can then withdraw or access their money through ATMs, bank apps, or over the counter.
To avoid delays, employers should ensure every employee has a valid bank account or WPS card.
How to Prepare a Correct SIF
A standard SIF is an Excel file containing the Employee Detail Record for each staff member. Required fields include:
Labour card number
Bank routing code
Employee bank account number
Salary start and end dates
Number of payable days
Basic salary
Variable salary
Leave details
Mistakes in any of these fields can lead to file rejection, which then causes delayed salary payment and potential penalties.
Salary Deadlines Under WPS (Updated for 2025)
According to Ministerial Resolution 598 of 2022:
Salaries must be paid by the due date specified in the contract.
If no date is mentioned, the salary must be paid once every month.
Employers are considered late if payment is not made within fifteen days after the due date unless the contract specifies a shorter period.
Penalties for Late Payment or Noncompliance
Noncompliance triggers graded penalties based on the duration of the delay and the size of the company.
For companies with 100 or more employees
On the sixteenth day after the delay, work permit issuance was suspended.
The employer cannot obtain approvals for new entities under these circumstances.
All companies owned by the same employer may face action.
The company may be downgraded to the third category in MOHRE’s system.
Workers receive the right to transfer to another employer.
For false information or attempts to evade WPS
A fine of up to AED 5000 per employee
Maximum fine of AED 50000 for multiple affected workers
These penalties fall under Cabinet Resolution 21 of 2020.
Who Is Excluded From WPS Requirements
Some categories are exempt from WPS:
Exempt Employees
Employees with wage-related cases referred to the judiciary
Employees reported under work abandonment
New employees within their first thirty days
Employees on approved unpaid leave
Exempt Employers
UAE nationals who own fishing boats
UAE nationals who own public taxis
Banks
Houses of worship
WPS Penalties Overview Table (UAE 2025)
Violation | When It Applies | Penalty / Action Taken |
Late Salary Payment | Salary not paid within 15 days after due date | • Company marked noncompliant • Early warnings issued by MOHRE |
Delay Beyond 16 Days (Companies with 100+ Employees) | Day 16 after due date | • Suspension of new work permits • Freeze on approvals for new companies under same owner |
Repeated Delay or Extended Nonpayment | Each cycle of nonpayment | • Company downgraded to Category 3 • Additional inspection and compliance monitoring |
Failure to Pay 70% of Employees or 75% of Total Salaries | Monthly compliance check | • Company flagged in WPS system • Salary protection audit by MOHRE |
Submitting Incorrect or Manipulated Salary Data | Providing false SIF information to avoid payment | • Fine up to AED 5000 per affected employee • Maximum fine of AED 50000 for multiple employees |
Total Noncompliance with WPS Requirements | Employer repeatedly ignores salary obligations | • Work permit ban for all employees • Potential legal action • Employees allowed to transfer jobs |
Non-Payment in JAFZA Zone | Salary not paid by the 19th of the following month | • Work permit restrictions in JAFZA • Monetary fines unless employer submits valid justification |
Deducting Bank or Exchange Fees from Employees (DMCC) | When employer tries to pass WPS costs to staff | • DMCC penalties and compliance warnings |
Not Registering New Employees Within 30 Days | Mainland and DMCC requirements | • Compliance violation and potential fines |
Paying Salaries Outside AED Currency Requirement (DMCC) | When salary is not paid in AED | • File rejection and DMCC fines |
How Employers Can Get the Best Value from WPS
To maximize efficiency and avoid penalties, employers should:
Keep employee records up to date
Ensure SIFs are without any errors.
Use automated payroll systems compliant with WPS
Maintain a clear internal salary calendar
Confirm that employees have valid bank accounts or payroll cards
Monitor WPS status regularly through the MOHRE portal
Conclusion
WPS is one of the most important labor compliance systems in the UAE. It protects employee rights, enhances payroll transparency, and shields companies from legal risks. For employers, especially in the healthcare sector, full compliance is not only a legal responsibility but also a foundation for maintaining trust and smooth operations.
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