all things to know about wpswage protection system payroll
UAE is home to people from over 200 countries who greatly contribute to the country’s economic development through their unmatched talent and professional skills. The payroll processing in UAE is a complex and crucial function for employers as they have to ensure they comply with the employment laws and everything else related to the rights of employees.
The UAE Wages Protection System (WPS) exists as an electronic salary transfer system that operates through joint development between MOHRE and the Central Bank of the UAE. Through the WPS process in UAE, companies can transfer worker compensation to banks along with authorized financial institutions efficiently. This article provides comprehensive information about WPS in the UAE along with its advantages, as well as procedural details and the registration criteria and recommendations for selecting trusted payroll service providers in UAE.
The wage Protection System was created collaboratively by the Central Bank of the United Arab Emirates and the Ministry of Human Resources and Emiratisation (MOHRE) to introduce an advanced and centralized salary distribution system in the country.
The WPS or Wage Protection System is an electronic salary distribution system that enables organizations of the private sector in the UAE to pay their workforce’s wages through banks, approved financial institutions, and the Bureau de Change. In this system, the Ministry of Human Resources and Emiratisation (MOHRE) provides organizations in the private sector with a secure database for creating salary files for their employees.
These files are then further sent to their respective banks for salary distribution. Based on the designation and role of each employee, the files contain crucial information about their salary, enabling MOHRE to ensure that all employees’ dues are timely paid.
WPS implementation has the following benefits:
The WPS Payroll is to facilitate the employees working in the private sector of UAE.
Here are some main goals of the WPS Payroll:
In the Wage Protection System, there are various stakeholders involved. These are:
Employees are individuals under the payroll of the organizations of the private sector who work in return for an agreed salary. The employees need to provide the labor card issued by MOHRE.
In UAE all organizations and employers in the private sector are supposed to register with WPS and MOHRE.
The bank account the employer holds will be part of the WPS payment for all employees under the payroll.
It includes any bank, other financial institution, or bureau de change that the UAE Central Bank has authorized to accept salary payments via WPS. The Central Bank of the UAE updates its list of recognized names and authorized agents regularly.
Employers in the private sector can easily register for the Wage Protection System online through the official website of the Ministry of Human Resources and Emiratisation (MOHRE). All they need to provide for registering and logging themselves for WPS is:
Please note that according to the guidelines provided by MOHRE:
“Salary month cannot have a difference of more than one month from the dates chosen to pay the salary.” Furthermore, the guidelines also suggest, that “whenever an employee joins or leaves a company, you will need to download a new employee list and attach it to the application.”
Read More: Wage Protection System in Qatar
To register your business with WPS, you will need:
Once registered, companies are required to pay salaries within 10 calendar days from the due date. Failure to do so could result in fines starting from AED 1,000 per employee, suspension of new work permits, or even legal actions.
The two methods to withdraw your salary from WPS are:
Employees without a proper bank account in the UAE can apply for a WPS card to withdraw their pay. Furthermore, WPS-registered businesses can work with UAE money exchangers to provide a cost-effective WPS-compliant payroll solution. These exchanges offer financial transfer and salary disbursement services to employees. The WPS card is also issued by the exchanges and can be used throughout the Emirates at various venues.
The salary can be withdrawn by employees who have a relative’s bank account in the UAE and an ATM card; the process is simple. The bank then sends you a notification of the salary transfer if you have a personal account with them. It can be done via SMS or email.
Choosing the right payroll provider is essential for maintaining compliance and operational efficiency. Here’s what to look for:
Payroll Middle East is one of the finest payroll outsourcing companies in UAE and other countries of the Middle East such as Kuwait, Qatar, Saudi Arabia, and Oman. Along with endless payroll services in UAE, we also facilitate our clients by enlightening and assisting them with WPS payroll processing, WPS registration, WPS payroll, and other WPS payroll services.
If your organization needs assistance regarding the WPS payroll in Dubai, book a free consultation session with us today.
The Wages Protection System (WPS) is an electronic salary transfer system developed by the Central Bank of the UAE in collaboration with the Ministry of Human Resources and Emiratisation (MoHRE). It was introduced to ensure that employees in the private sector receive their salaries in a timely and transparent manner, in compliance with UAE labor laws.
Yes. All private-sector employers registered with MOHRE must comply with WPS.
No. Cash or cheque payments are not permitted under WPS. All payments must go through the official WPS channels.
Late or missed payments can lead to fines, suspension of new work permits, and even a ban on your trade license.
Wages must be paid monthly or as per the employment contract, and within 10 days of the due date.