Is your employee’s salary delayed? Here’s why -
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Is your employee’s salary delayed? Here’s why

For an employee, nothing is awaited with as much eagerness as the monthly pay cheque. It’s a symbol of hard work, dedication, and the financial security that allows employees to meet their needs and aspirations.

Even a few days of delay can create significant problems in the life of a salaried employee and can lead to disappointment and frustration. While there are unfortunate instances when the expected salary doesn’t arrive on time, it is important to remember that salary delays could happen due to a number of reasons. Sometimes it just takes time for it to reflect in your account.

Let’s look at the various factors that could lead to delays and see how salaries could reflect late sometimes, despite being processed, in the UAE.

  • Processing issues

One of the most common reasons for salary delays in the UAE can be attributed to processing issues. Human errors, technical glitches, or delays in the payroll department can hinder the smooth and timely transfer of funds into employees’ accounts. Companies, particularly larger organisations with a significant workforce, may face challenges in ensuring seamless payroll processing every month, resulting in unavoidable delays.

  • Financial constraints

In some instances, salary delays could directly be related to the financial health of the company. Economic downturns, cash flow problems, or unexpected financial crises may force businesses to prioritize essential expenses over timely payroll disbursals.

While this can be a short-term measure to keep the company afloat, it negatively impacts employee morale and can lead to increased employee turnover in the long run.

  • Rough phase

It is possible for your company or your industry to genuinely go through a rough patch, which leads to a delay in processing salaries. Catastrophes or adversities such as recession, pandemic, etc lead to cash flow issues, reduced sales and operational issues. In such cases, companies try to maintain as much liquidity as they can to survive, until everything is back on track.

  • Labour Laws violation

The UAE has stringent labour laws in place to protect the rights of the workers. However, some employers may attempt to violate the regulations by withholding or delaying salaries. For expatriate workers who are away from their home countries and heavily rely on their wages to sustain themselves and their families, this could have a worrying effect.

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  • Delays due to Public Holidays

Public holidays can inadvertently cause salary delays, which takes time to reflect. When a public holiday falls near the end of the month, it can disrupt regular payroll processing schedules. Banks and financial institutions may have limited working hours or be closed entirely on these days, leading to unavoidable delays in salary transfers.

  • Administrative hurdles

A lesser-known reason for salary delays is when companies process salaries on time, but the funds are not reflected in employees’ accounts due to administrative bottlenecks. This could involve delays in fund transfers, banking procedures, approvals from the bank or the government, or any other unforeseen issues that prevent employees from accessing their salaries promptly.

Both sides of the coin

While salary delays can be distressing for your employees, it’s essential to approach the situation with patience and understanding. The UAE’s labour laws are designed to protect the workers’ rights, and employees should be aware of their entitlements to ensure they are treated fairly. Often, communicating with the employer will help employees to gain insights into the cause of the delay, and this can help provide more clarity.

Employers, on the other hand, should strive to prioritise timely salary disbursals and maintain open channels of communication with their workforce. Implementing robust payroll processing systems, adhering to labour laws, and being transparent about any financial constraints can help foster a positive work environment. This will greatly help to enhance employee loyalty and productivity.

Conclusion

As the UAE continues to develop and grow as a global business hub, it is essential that salary delays become less prevalent from the employers’ end, and that companies and authorities work collaboratively to ensure employees are paid promptly and fairly. The UAE government’s WPS initiative, for instance, has played a great role in ensuring that employees are paid digitally, and on time. The implementation of more tech solutions that can enforce stricter rules for labour law violations, are sure to add up in this endeavour.

For more information related to your employees’ financial rights, WPS-compliant salary processing or payroll services in UAE, feel free to reach out to us on info.ae@edenred.com

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