TRW & Co · Employment & Immigration
Immigration Compliance Audits in the UAE
Immigration compliance audits in the UAE check that every worker holds the right permit, visa and Emirates ID under the right entity and role. With labour law fines now reaching AED 1,000,000 for serious violations and MOHRE targeting inactive establishments with registered workers, employers and investors need to find problems before inspectors do.
Key pointMOHRE's 2025 action against establishments with workers but no genuine activity shows the authorities now audit employers by cross-checking data, so a dormant entity with live visas can lead to permit freezes and bans on its owners registering new businesses.
At a glance
Higher labour fines
Federal Decree-Law No. 9 of 2024, effective 31 August 2024, raised fines for serious violations into the AED 100,000 to AED 1,000,000 range.
Fictitious employment targeted
Penalties for fictitious employment are multiplied by the number of workers involved, making sham hires and sham Emiratisation especially costly.
Dormant entities in focus
In 2025 MOHRE acted against around 1,300 establishments with registered workers but no genuine activity, suspending permits and barring owners.
Residence framework
Federal Law by Decree No. 29 of 2021 and its Executive Regulation, Cabinet Resolution No. 65 of 2022, govern entry, residence and sponsorship.
Remediation needs sequencing
Corrective filings, cancellations and transfers should be ordered carefully so they cure gaps without generating new violations or prejudicing employees.
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What immigration compliance audits in the UAE cover
Immigration compliance audits in the UAE are structured reviews of whether every person working for or sponsored by a business holds the right work permit, residence visa and Emirates ID, under the right entity, for the role they actually perform. A good audit also tests the processes behind those documents: onboarding, renewals, cancellations, payroll, insurance and record-keeping. The aim is to find and fix gaps before an inspector, a dispute or a transaction finds them first.
The stakes have risen. Since 31 August 2024, amendments to the federal labour law have raised fines for the most serious violations into a range of AED 100,000 to AED 1,000,000, and the Ministry of Human Resources and Emiratisation (MOHRE) uses data analytics and field inspections to spot establishments whose sponsored workers do not match their real activity. Penalties now reach owners personally through bans on registering new establishments.
An audit is most useful at predictable moments: after rapid growth, before a sale or investment, when restructuring entities across mainland and free zones, after a whistleblower complaint, or when a new HR or PRO team takes over. It is also the fastest way for a new general counsel to understand a group's real immigration position.
The legal framework the audit tests against
An audit measures practice against several overlapping instruments. Getting the framework right is what separates a legal audit from a document count.
Entry and residence law
Federal Law by Decree No. (29) of 2021 Concerning Entry and Residence of Foreigners sets the rules on entry permits, residence permits, sponsorship and violations. Its Executive Regulation was issued by Cabinet Resolution No. (65) of 2022, and the Federal Authority for Identity, Citizenship, Customs and Ports Security (ICP) applies fee and administrative fine schedules under Cabinet Resolutions No. (88) and (89) of 2022. The UAE legislation portal lists these related instruments. In Dubai, the General Directorate of Residency and Foreigners Affairs (GDRFA Dubai) handles residence matters; the ICP handles the other emirates.
Labour law and MOHRE regulation
Federal Decree-Law No. 33 of 2021 on the Regulation of Labour Relations governs mainland private sector employment, including work permits, contracts, wage protection and Emiratisation. Federal Decree-Law No. 9 of 2024, effective from 31 August 2024, raised fines for violations such as employing workers without permits and fictitious employment, with penalties for fictitious employment multiplied by the number of workers. MOHRE's service fees and administrative fines are set by Cabinet Resolution No. (21) of 2020.
In June 2025 MOHRE announced action against around 1,300 establishments with registered workers but no genuine licensed activity, relying on Ministerial Resolution No. (318) of 2024. Consequences included suspension of new work permits, fines, placement in the lowest establishment category and a bar on owners registering new establishments. That announcement is the clearest public signal of how the authorities now audit employers themselves.
Free zones, DIFC and ADGM
Free zone authorities issue their own employment cards and sponsor residence visas for their licensees, while the DIFC and ADGM have their own employment laws. Federal immigration law still applies everywhere: a free zone employee is a UAE resident sponsored under federal rules. Audits must therefore check both the zone's rules and federal residence compliance. Our article on free zone visas explains the mechanics.
| Area | Authority | What auditors check | Typical finding |
|---|---|---|---|
| Work authorisation | MOHRE or free zone authority | Valid permit for every worker, matching employer, job title and activity | Staff working for a group company other than their sponsor |
| Residence and Emirates ID | ICP or GDRFA Dubai | Valid residence permits and Emirates IDs, timely renewals and cancellations | Leavers whose visas were never cancelled |
| Establishment records | MOHRE, ICP, GDRFA, free zones | Valid establishment card, signatories and licence activities | Expired establishment card blocking new applications |
| Wage protection | MOHRE | Salaries paid through the Wage Protection System and matching contracts | Allowances paid outside payroll, creating contract mismatches |
| Insurance | Emirate health regulators, MOHRE | Health insurance for employees and dependants; unemployment insurance enrolment | Cover lapsing between renewals |
| Emiratisation | MOHRE | Targets met with genuine roles, correct registration and pensions | Nationals registered in roles with no real duties |
Choosing the scope and approach
Immigration compliance audits in the UAE range from a quick health check to a privileged, group-wide investigation. The right scope depends on what triggered the review and who will rely on it.
Health check
A sample-based review of files, permits and processes in one entity. Useful for annual assurance or when a new HR lead arrives, and usually completed quickly with limited disruption.
Full population audit
Every employee, contractor and dependant across the group is reconciled against government portals, payroll and HR records. It is the right choice before a transaction or after rapid growth.
Privileged investigation
Where wrongdoing is suspected, such as fictitious employment or visa trading, the audit is run under legal direction to protect privilege and manage reporting decisions.
Transaction due diligence
A targeted review for buyers or investors that quantifies exposure and feeds warranties, indemnities, price adjustments and conditions to closing.
Whatever the scope, decide at the outset what the output will be. Boards usually want a short risk-rated summary with an action plan and owners for each item; HR teams need a detailed register at employee level. Separating the two keeps sensitive analysis contained while giving the operational team what it needs to fix records quickly.
Legal privilege is not automatic in the UAE in the way it is under English law, so structuring matters. An audit commissioned by legal counsel for the purpose of advice, with access controls on findings, gives the business more control over how sensitive conclusions are used. Our workplace investigations page discusses this further.
The audit process step by step
- Agree scope and governance. Define entities, populations, period and reporting lines. Decide who sees findings and whether the work is commissioned for legal advice.
- Build a master headcount. Reconcile HR, payroll and finance data with MOHRE, ICP or GDRFA and free zone portal records to create a single list of everyone working for or sponsored by the group, including contractors and secondees.
- Test each record. For every person, check permit type, sponsor, job title, salary, contract, Emirates ID, residence validity, insurance and actual role and location.
- Review establishment-level compliance. Check trade licences, establishment cards, authorised signatories, MOHRE category, Emiratisation status and wage protection reports.
- Interview and walk through processes. Speak to HR, PRO and line managers about onboarding, renewals, cancellations, secondments and use of agencies.
- Grade findings and quantify exposure. Classify gaps by severity and estimate fines and operational consequences, including permit freezes or downgrades.
- Remediate in the right order. Regularise urgent issues first, such as staff working without permits, then correct records, contracts and processes.
- Embed controls. Introduce a compliance calendar, dashboard and periodic re-testing so issues do not return.
Remediation can itself create risk if done carelessly. Cancelling a visa for an employee who is still working, or applying for a new permit that reveals past unauthorised work, should be sequenced with legal advice. Plan corrective filings so they cure the problem without generating fresh violations or prejudicing employees' rights.
Documents and data to gather
The quality of immigration compliance audits in the UAE depends on the data. Gather the following before fieldwork begins.
- Trade licences, establishment cards and authorised signatory records for every entity, mainland and free zone.
- Government portal extracts listing permits, residence visas and Emirates IDs under each establishment.
- Payroll and Wage Protection System reports, with allowance and bonus data.
- Employment contracts registered with MOHRE or the free zone, plus offer letters and side letters.
- Health and unemployment insurance records for employees and, where required, dependants.
- Agency, outsourcing and secondment agreements, and lists of contractors on site.
- Emiratisation reports, pension registrations and role descriptions for UAE national staff.
- Visa cancellation records and exit evidence for leavers in the review period.
The most expensive immigration problems are rarely missing documents. They are documents that exist but describe a different employer, a different role or a business that no longer operates.
Common findings and risks
Staff working for a group company that does not sponsor them
Groups often hire through one entity and deploy staff across several, especially where a free zone company provides services to a mainland affiliate. Working for an entity other than the sponsor without the correct permit is a violation, even within the same group. The fix may involve transfer of sponsorship, secondment permits or restructuring which entity contracts with clients. Our page on employment permits explains the options. Audits should map actual reporting lines, office locations and client billing, not just the HR system.
Dormant entities with sponsored workers
Entities that have stopped trading but still sponsor workers are now a priority for MOHRE. Its 2025 action against inactive establishments led to permit suspensions, substantial fines, downgrades and bans on owners registering new establishments. If an entity is winding down, settle workers' status and cancel permits and licences in the proper order. Leaving visas in place to save time or cost can expose owners personally. See our article on closing a company for the sequence.
Fictitious employment and Emiratisation
Registering workers, including UAE nationals, in roles with no genuine work to meet quotas or obtain permits is treated severely. The 2024 labour law amendments introduced substantial fines for fictitious employment, multiplied by the number of workers involved. Audits should test whether Emiratisation hires have real duties, supervision, pay and attendance records. Our Emiratisation compliance page covers targets and verification. Where problems are found, legal advice on corrective steps and disclosure is essential.
Visit visas, freelancers and contractors
Businesses sometimes bring in staff on visit visas or rely on individual freelancers and agency workers without checking their status. Work on a visit visa is not permitted, and a freelancer's permit may not cover the services supplied. The business receiving the services can be exposed alongside the individual. Audits should list everyone performing work on site or remotely in the UAE, check their permits and review contracts with agencies for compliance warranties and audit rights.
Retaining passports and Emirates IDs
Holding employees' passports or Emirates IDs as security is a long-standing practice in some sectors, but the labour law prohibits employers from confiscating employees' official documents, and the official government portal states that companies may not hold employees' Emirates ID cards, although they may record the data. Audits should check document storage practices and replace them with voluntary safe-keeping arrangements that employees can end at any time. Our page on Emirates ID and establishment cards explains related obligations.
Leavers whose visas were never cancelled
When employees leave, the employer must cancel the work permit and residence visa, and the Emirates ID is cancelled with the residence. Failing to do so can create overstay liabilities, block new applications and complicate disputes. Audits often find leavers who are abroad or have joined other employers while still showing under the old establishment. Our article on visa cancellation sets out the process.
Linked obligations that audits often miss
Immigration status in the UAE is tied to a web of related obligations. Immigration compliance audits in the UAE that stop at permits and visas tend to miss the issues that most often block renewals.
Health and unemployment insurance
Employer-funded health insurance for private sector employees and domestic workers became mandatory across all emirates from 1 January 2025, extending a requirement that Dubai and Abu Dhabi already had. Valid cover is a condition for issuing and renewing residence permits, so a lapse can stall renewals across a whole workforce. Employees are also required to join the federal involuntary loss of employment scheme, and while the obligation sits with the employee, employers often administer enrolment and should check it. Our article on unemployment insurance explains the scheme.
Wage protection and registered contracts
Salaries for mainland employees must be paid through the Wage Protection System, and what is paid should match the registered contract. Allowances paid in cash or through a different entity create mismatches that inspectors notice and that employees can rely on in disputes. Audits should compare WPS files with contracts and offer letters for a sample of employees in every grade.
Integrated government platforms
The authorities increasingly link their systems. Dubai's Work Bundle platform brings work permit, residence and Emirates ID steps together, and MOHRE, ICP and GDRFA share data. The practical effect is that inconsistencies between an employee's job title, salary, sponsor and activity are more visible than they used to be, and errors in one system can block transactions in another.
Transactions and restructurings
Immigration compliance audits in the UAE are increasingly part of M&A due diligence. Buyers want to know whether the workforce is lawfully employed, whether licences and establishment cards are in good standing and whether the target has hidden exposure from fines, permit freezes or a low MOHRE category. Findings feed into specific indemnities, pre-closing remediation covenants and price adjustments.
Restructurings carry their own risks. Moving staff between entities, converting branches into subsidiaries or migrating from mainland to free zone all require new permits and visa transfers, sequenced to avoid gaps in status. Our corporate restructuring team plans these moves alongside immigration filings.
The cross-border angle
Many UAE employers recruit heavily from Bangladesh, India, Pakistan, the Philippines and other source countries, and move staff to and from Saudi Arabia, the UK and Singapore. Recruitment practices in source countries, including fees charged to workers, can create reputational and legal exposure under UAE rules and under supply chain due diligence regimes elsewhere. Audits should cover recruitment agencies as well as UAE filings.
Multinationals headquartered in the UK or Singapore often face home-country reporting duties, such as modern slavery statements, that draw on UAE workforce data. Bangladeshi groups with UAE subsidiaries need to align overseas employment approvals at home with UAE sponsorship. TRW & Co coordinates across Dhaka, London, Singapore and Dubai so that findings and remediation are consistent across jurisdictions.
How TRW & Co helps
We design and run immigration compliance audits in the UAE for employers, investors and boards, and support the remediation that follows. Our work is advisory, strategic and coordinating; where representation before UAE onshore courts or the DIFC/ADGM Courts is required, we work alongside locally licensed advocates and registered practitioners.
Audit design and delivery
We scope audits, set governance and privilege protocols, reconcile headcount data and test every record against federal, emirate and free zone requirements.
Exposure assessment
We grade findings, estimate fines and operational consequences and give boards a clear, prioritised view of risk.
Remediation planning
We sequence corrective filings, sponsorship transfers and cancellations so problems are cured without creating new violations.
Policies and controls
We draft onboarding, secondment, contractor and document custody policies and build compliance calendars linked to wage and payroll processes.
Transaction support
We run immigration due diligence for buyers and investors and draft warranties, indemnities and remediation covenants.
Regulator interaction
We prepare responses to inspections and inquiries and coordinate with locally licensed practitioners where formal proceedings arise.
Checklist for decision-makers
- Know how many people work for the group in the UAE, under which sponsor, and in what role.
- Confirm every establishment card, trade licence and authorised signatory is current.
- Reconcile payroll, wage protection data and registered contracts at least annually.
- Check health and unemployment insurance for every employee and dependant where required.
- Test that Emiratisation roles are genuine and properly documented.
- Cancel permits and visas promptly for leavers and dormant entities.
- Stop retaining passports and Emirates IDs without free, revocable consent.
- Commission audits under legal direction where wrongdoing may be found.
To scope an audit, contact TRW & Co or explore our practices.
Frequently asked questions
01How often should a UAE employer audit immigration compliance?
Most employers benefit from an annual health check, with a fuller audit after rapid growth, a restructuring, a change of HR or PRO team, or before a transaction. Regulators now cross-check permit, payroll and licence data continuously, so long gaps between reviews allow problems to accumulate. A compliance calendar for renewals and cancellations, combined with periodic sample testing, keeps most issues from reaching audit stage.
02What are the penalties for employing someone without a work permit?
Since 31 August 2024, amendments to the labour law have set fines for serious violations, including employing workers without permits, in a range of AED 100,000 to AED 1,000,000. MOHRE can also suspend new permits, downgrade the establishment's category and take action against owners. Separate immigration fines can apply under the entry and residence framework. The precise exposure depends on the facts, so quantify it during the audit.
03Can staff of one group company work for another group entity?
Not simply because they are in the same group. A worker must be authorised to work for the entity that actually employs and directs them. Group secondments, shared services and cross-entity deployments need the right permits or a transfer of sponsorship. Audits often find employees sponsored by one company but working for another, especially between free zone and mainland affiliates.
04Are audit findings protected by legal privilege?
Privilege in the UAE is less developed than under English law, so protection depends on structure. Audits commissioned by legal counsel for the purpose of giving legal advice, with controlled distribution of findings, give the business more control over sensitive conclusions. Where wrongdoing is suspected, a lawyer-directed investigation is advisable. Advice on disclosure to authorities should be taken before remediation filings are made.
05What should we do if the audit finds someone working without a permit?
Stop the unauthorised work and take advice before filing anything. The usual route is to regularise status through the correct permit or sponsorship transfer, but the sequence matters: some filings can reveal the past violation or affect the employee's rights. Assess exposure, document the decision and fix the process failure that caused the gap so it does not recur.
06Do free zone companies need immigration compliance audits?
Yes. Free zone authorities issue employment cards and sponsor visas, but federal residence law still applies, and free zone companies often provide staff or services to mainland affiliates, which raises work authorisation questions. DIFC and ADGM entities have their own employment laws but rely on federal immigration processes. Audits should test both zone rules and federal compliance.
07How do immigration findings affect an acquisition?
Buyers use immigration due diligence to identify unlawful employment, lapsed establishment cards, low MOHRE categories and potential fines. Findings typically lead to specific indemnities, pre-closing remediation covenants, price adjustments or conditions to closing. Where staff must move entities as part of the deal, permits and visas need to be transferred without leaving gaps in status.
Sources and official materials
- MOHRE: action against establishments with workers not engaging in licensed activities — 2025 enforcement, Ministerial Resolution No. 318 of 2024
- Federal Law by Decree No. 29 of 2021: related legislation — Entry and residence law and its executive regulation
- Federal Authority for Identity, Citizenship, Customs and Ports Security — Residence, Emirates ID and establishment services
- GDRFA Dubai — Residence and establishment services in Dubai
- Ministry of Human Resources and Emiratisation — Work permits, wage protection and inspections
- UAE Government portal: Visa and Emirates ID — Official guidance on visas and Emirates ID
General information only, current as at 27 October 2026. It is not legal advice and does not create a lawyer–client relationship. UAE law differs between the onshore jurisdiction, the DIFC, ADGM and the free zones, and changes frequently; check current official sources and take advice on the facts of your matter.
