Imagine this: you’re ready to expand your business to the Emirates, a thriving international trade hub. However, you quickly realise that understanding and adhering to the local employment laws, tax regulations, and compliance requirements is like wandering through a complex maze without a guide. This is where partnering with an Employer of Record (EOR) can be a game-changer for your business.

An Employer of Record in the Emirates manages all employment-related tasks on your behalf, including payroll, taxes, and legal compliance. This allows you to focus on growing your business without establishing a legal entity in the country. Here’s a simple 10-step guide to help you understand how to work with an EOR in the Emirates.

1. Understand the role of an EOR

An Employer of Record in the Emirates acts as the legal employer for your employees while you maintain control over their day-to-day tasks and operations. The EOR handles everything from processing payroll and managing taxes to ensuring compliance with local labour laws. This reduces your administrative workload and ensures that your business operates within the boundaries of Emirati law without the need for a regional entity.

For example, I remember speaking to a UK-based business owner who was excited to hire in Dubai but was overwhelmed by the paperwork for visa sponsorships and health insurance requirements. Partnering with an EOR helped him hire quickly and focus on growing his sales team instead of worrying about compliance.

2. Evaluate your business needs

Ask yourself why you need an Employer of Record in the Emirates. Are you aiming to hire a small team to test the market, or are you looking to expand your workforce more broadly? If you aim to avoid the hassle of setting up a legal entity, minimise risks, and ensure compliance with local employment laws, then an EOR is the ideal solution. 

An EOR helps you hire quickly and remain compliant, while allowing you to focus on growing your business.

3. Choose the right EOR provider

Not all EOR providers are the same. You’ll want to partner with a provider with deep expertise in the Emirates market and a strong reputation for delivering high-quality services. Look for an EOR offering comprehensive services such as payroll management, tax compliance, employee benefits, and legal compliance. 

For instance, a colleague shared a story about selecting an EOR based only on price, which led to hidden fees and poor service. To avoid unpleasant surprises, choose a provider with a clear and transparent pricing structure.

4. Discuss compliance and legal requirements

The Emirates has its own set of labour laws and regulations, and failing to comply with them can result in penalties. An EOR will guide you through these legal requirements, ensuring compliance with laws regarding employee contracts, social security contributions (if applicable), and taxes. 

The EOR ensures that all employment contracts meet Emirati regulations and that the correct taxes are withheld from employee salaries. This reduces the risk of fines and ensures your business remains compliant.

One of our clients tried hiring directly in Abu Dhabi but faced fines for incorrect employment contracts. They didn’t realise that each contract needs to be aligned with specific Emirati regulations. Partnering with an EOR saved them from potential future compliance issues.

5. Plan your budget

Before you start, it’s essential to plan your budget carefully. An EOR will provide a clear breakdown of costs, including employee salaries, social security contributions (if required), taxes, and service fees. 

Knowing these costs upfront helps avoid surprises and ensures your expansion remains financially sustainable. The EOR will also help you optimise expenses by managing payroll efficiently and fully complying with tax laws.

6. Draft a service agreement

After selecting your EOR provider, the next step is to draft a service agreement. This document outlines the roles and responsibilities of your business and the EOR, including the scope of services, payment terms, and contract duration. 

A company I worked with once overlooked key contract terms, which led to confusion around who was responsible for certain benefits. Make sure your service agreement is detailed and reviewed thoroughly before signing. Ensure that all terms are clear, particularly regarding how the EOR will manage employee contracts and payroll and ensure compliance with local laws.

7. Onboard your employees

Once the service agreement is signed, the EOR will begin onboarding employees. This includes preparing legally compliant employment contracts, setting payroll, and managing benefits. 

I recall one business that tried to onboard employees themselves and faced delays due to missing visa paperwork. The EOR helped them resolve the issue quickly, avoiding further complications.

Also, in the Emirates, employees must be onboarded in line with local labour laws, including health insurance requirements and visa sponsorships. An EOR will ensure all necessary documentation is in place so your employees are ready to start work without delays.

8. Manage employee relations

While the EOR manages employment’s legal and administrative side, your business is still responsible for day-to-day employee interactions. It is important to maintain regular communication and provide your team with the guidance and support they need to succeed. 

The EOR will assist you in managing any employment-related issues, such as handling disputes, terminations, or disciplinary actions, ensuring everything complies with local laws. I once heard from a client who had trouble with an employee dispute. The EOR stepped in, handled the situation according to local laws, and resolved it without affecting team morale.

9. Monitor compliance and performance

Once your employees are onboarded, the EOR will continue to monitor compliance with Emirati labour laws, providing regular updates on payroll, taxes, and any regulation changes. This ensures your business remains compliant as you operate in the Emirates. The EOR will also track key performance metrics, ensuring they deliver on the agreed services and helping your business grow effectively.

10. Scale your operations

As your business grows, you may want to expand further within the Emirates or even into neighbouring countries. An EOR can help you scale your operations quickly by managing the complexities of hiring more employees and ensuring compliance with local laws. This allows you to expand without new legal entities, making growth faster and more efficient.

Start hiring in the Emirates

Let us help you expand your business into the Emirates with ease. By partnering with an Employer of Record in the Emirates, you can reduce risks, streamline operations, and focus on growth. I invite you to explore how our EOR services can simplify your hiring process and ensure compliance with local regulations. Contact us today to learn more about how we can support your successful expansion into the Emirates.