Healthcare Staffing Agreement (UAE)
HEALTHCARE STAFFING AGREEMENT
Dated: [Agreement Date]
Staffing Agency: [Agency Name] (Trade Licence / Recruitment Licence: [Agency Licence]), of [Agency Address] (the "Agency");
Healthcare Facility: [Facility Name] (Facility Licence: [Facility Licence]), of [Facility Address] (the "Facility").
The Agency and the Facility are together the "Parties".
1. SCOPE OF STAFFING SERVICES
1.1 The Agency shall supply the following categories of healthcare staff to the Facility: [Staff Categories].
1.2 Employment arrangement: [Employment Arrangement].
1.3 The Agency shall supply only staff who hold valid practice licences from [Regulatory Authority] for the roles to be performed and who have completed the vetting and verification procedures required by [Regulatory Authority], including DATAFLOW primary source verification where required.
1.4 Individual placements shall be documented in work orders agreed in writing between the Parties, setting out the role, the staff member's name and licence number, the assignment start and end date, and the applicable hourly or monthly rate.
1.5 The Agency shall perform its obligations in good faith with the skill and care of a competent healthcare staffing agency, pursuant to Article 246 of the UAE Civil Code (Federal Law No. 5 of 1985).
2. VETTING AND LICENCE VERIFICATION
2.1 Before introducing any staff member to the Facility, the Agency shall verify: [Vetting Obligations].
2.2 The Agency shall notify the Facility immediately if a staff member's practice licence issued by [Regulatory Authority] is suspended, revoked, or subject to conditions that restrict the staff member's scope of practice.
2.3 Medical liability of staff placed at the Facility is governed by Medical Liability Federal Law No. 4 of 2016. The Agency warrants that each staff member it places is appropriately qualified for the role and holds valid professional indemnity insurance as required by [Regulatory Authority].
3. TERM
3.1 This Agreement begins on [Start Date] and continues for [Term], unless terminated earlier in accordance with its terms.
4. FEES AND PAYMENT
4.1 Fee structure: [Fee Structure].
4.2 Payment terms: [Payment Terms].
4.3 All amounts are subject to Value Added Tax at the prevailing rate under the VAT Law (Federal Decree-Law No. 8 of 2017), administered by the Federal Tax Authority (FTA). The Agency shall issue valid tax invoices meeting FTA requirements.
5. EMPLOYMENT AND LABOUR LAW COMPLIANCE
5.1 Where the Agency employs staff and seconds them to the Facility, the Agency is the employer of record and is responsible for compliance with the Labour Law (Federal Decree-Law No. 33 of 2021) including payment of salaries on time, end-of-service gratuity (Article 51), leave entitlements, and MOHRE registration of employees and work permits.
5.2 The Facility shall cooperate with the Agency in meeting visa and residence permit requirements under the immigration regulations administered by the Federal Authority for Identity, Citizenship, Customs and Port Security (ICP).
5.3 The Facility is responsible for the clinical supervision and safe practice of placed staff while they work on the Facility's licensed premises, pursuant to Medical Liability Federal Law No. 4 of 2016.
5.4 Each Party shall comply with the anti-discrimination and workplace health and safety requirements applicable to the UAE healthcare sector.
6. DATA PROTECTION AND CONFIDENTIALITY
6.1 Each Party shall process personal data of placed staff and of patients in accordance with the Personal Data Protection Law (Federal Decree-Law No. 45 of 2021) and the standards of [Regulatory Authority].
6.2 Each Party shall keep confidential all non-public information of the other Party and all patient information obtained through the performance of this Agreement.
7. LIABILITY
7.1 The Agency is liable for losses caused by its failure to supply staff who meet the agreed vetting and licensing requirements. The Facility is liable for losses caused by its failure to provide adequate clinical supervision and safe working conditions for placed staff.
7.2 Medical liability for clinical negligence is governed by Medical Liability Federal Law No. 4 of 2016. Commercial liability for breach of this Agreement follows Articles 282 and 389 of the UAE Civil Code (Federal Law No. 5 of 1985).
8. TERMINATION
8.1 Either Party may terminate this Agreement on [Termination Notice].
8.2 Either Party may terminate immediately where the other commits a material breach unremedied after written notice, or where [Regulatory Authority] suspends or revokes the Facility's licence or takes action affecting the Agency's ability to place staff.
8.3 On termination, individual placement work orders shall continue until their stated end date unless separately terminated. The Parties shall settle all outstanding fees and any employment obligations arising from placed staff.
9. GENERAL
9.1 This Agreement is governed by the laws of the United Arab Emirates and the Parties submit to the exclusive jurisdiction of the [Governing Forum].
9.2 This Agreement is the entire agreement between the Parties on its subject matter and may be amended only in writing signed by both Parties.
Signed for and on behalf of the Agency: [Agency Name]
Signed for and on behalf of the Facility: [Facility Name]
Staffing Agency
________________
Signature
Healthcare Facility
________________
Signature
What Is a Healthcare Staffing Agreement (UAE)?
A Healthcare Staffing Agreement in the United Arab Emirates is a commercial contract between a licensed staffing agency and a licensed healthcare facility under which the agency supplies qualified healthcare staff — nurses, allied health professionals, locum doctors, healthcare assistants, and other clinical and non-clinical personnel — to the facility on agreed terms. The agreement governs the staffing categories, the vetting and licence verification obligations, the employment arrangement and employer-of-record identification, the staffing fees, the medical liability position, and the regulatory compliance obligations of each party.
The UAE healthcare workforce is one of the largest sectors of the country's economy, with the majority of practitioners being expatriates recruited internationally. The healthcare staffing market operates across all seven emirates but is concentrated in Dubai and Abu Dhabi, where the Dubai Health Authority (DHA) and the Department of Health Abu Dhabi (DOH) license, credential, and monitor all healthcare practitioners. The Ministry of Health and Prevention (MOHAP) licenses practitioners in the other emirates, and the Sharjah Health Authority (SHA) has jurisdiction in Sharjah.
The contractual framework rests on three statutes. The UAE Civil Code (Federal Law No. 5 of 1985) governs the commercial contract between the agency and the facility: Article 125 on formation, Article 246 on good-faith performance, Article 257 making the contract the law of the parties, and Articles 282 and 389 on compensation for breach. The Labour Law (Federal Decree-Law No. 33 of 2021), enforced by the Ministry of Human Resources and Emiratisation (MOHRE), governs the employment relationship between the agency or facility and the placed workers, including salary, leave, end-of-service gratuity under Article 51, and MOHRE registration. Medical Liability Federal Law No. 4 of 2016 attaches to the clinical practice of placed staff on the facility's licensed premises, making the facility responsible for clinical supervision and the practitioner responsible for their individual standard of care, assessed by the Medical Liability Committees at federal and emirate levels.
Every clinical practitioner placed under a Healthcare Staffing Agreement must hold a valid personal practice licence from the DHA, DOH, MOHAP, or SHA covering the role they will perform. DATAFLOW primary source verification — mandatory for DHA and DOH licensing — must be completed before the practice licence is issued. A staffing agency that places unlicensed or inadequately credentialled practitioners exposes both itself and the facility to regulatory sanctions and to liability under Medical Liability Federal Law No. 4 of 2016.
Value Added Tax under the VAT Law (Federal Decree-Law No. 8 of 2017), administered by the Federal Tax Authority (FTA), applies to staffing services at the standard rate of 5%. The Personal Data Protection Law (Federal Decree-Law No. 45 of 2021), administered by the UAE Data Office, applies to personal data of placed staff and of patients accessed by placed staff. Electronic execution is valid under the Electronic Transactions and Trust Services Law (Federal Decree-Law No. 46 of 2021).
When Do You Need a Healthcare Staffing Agreement (UAE)?
A Healthcare Staffing Agreement in the United Arab Emirates is needed whenever a healthcare facility engages a staffing agency to supply clinical or non-clinical staff, and both parties need enforceable terms that address the unique licensing, employment, and medical liability requirements of the UAE healthcare sector.
Hospital systems and large multi-site healthcare groups use master Healthcare Staffing Agreements with preferred agency panels to streamline the procurement of nursing and allied health staff. The Abu Dhabi Health Services Company (SEHA), Cleveland Clinic Abu Dhabi, Mediclinic Middle East, and other group operators rely on structured agreements that define vetting standards, DHA or DOH practice licence requirements, fee structures, MOHRE compliance obligations, and medical liability allocation across the portfolio.
Growth and expansion phases generate intensive staffing demand. When new facilities are commissioned in Dubai Healthcare City, the Abu Dhabi Health District, or the community healthcare network across the smaller emirates, they must staff up to the DHA, DOH, or MOHAP facility licence conditions before they can open. Healthcare Staffing Agreements with specialist agencies allow rapid deployment of credentialled staff while permanent recruitment is completed.
Temporary cover arrangements — for annual leave, maternity leave, sick leave, and long-term absence — require short-term staffing at every healthcare facility. The Healthcare Staffing Agreement governs the framework under which individual work orders are issued when cover is needed, avoiding the need to negotiate a fresh contract each time.
Specialist and niche staffing — intensive care nurses, theatre practitioners, interventional radiographers, and specialist allied health professionals — requires agencies with the networks and DATAFLOW verification capacity to source appropriately credentialled candidates. A Healthcare Staffing Agreement with a specialist agency that is experienced in UAE healthcare licensing gives the facility access to this specialist market.
In every context, a written Healthcare Staffing Agreement protects both parties by recording the vetting obligations, the employment arrangement, the MOHRE compliance responsibilities, the fee structure including VAT, the medical liability allocation under Medical Liability Federal Law No. 4 of 2016, and the forum for resolving disputes.
What to Include in Your Healthcare Staffing Agreement (UAE)
A UAE Healthcare Staffing Agreement compliant with the Labour Law (Federal Decree-Law No. 33 of 2021), Medical Liability Federal Law No. 4 of 2016, and the UAE Civil Code (Federal Law No. 5 of 1985) must contain the following elements. The forms-legal.com UAE Healthcare Staffing Agreement template addresses each component in a structure accepted by the Dubai Courts, the Abu Dhabi Judicial Department, and free-zone tribunals.
Party identification must record the full legal name of the agency and the facility, the agency's trade licence and MOHRE private recruitment agency licence number, the facility's healthcare facility licence number from the relevant health authority — the Dubai Health Authority (DHA), the Department of Health Abu Dhabi (DOH), the Ministry of Health and Prevention (MOHAP), or the Sharjah Health Authority (SHA) — and the registered address of each.
Staffing categories must describe the categories of healthcare workers the agency is authorised to supply — registered nurses, allied health professionals, healthcare assistants, locum doctors — and confirm that all clinical staff must hold valid practice licences from the relevant health authority covering the roles they will perform.
Vetting and licence verification obligations must require the agency to complete DATAFLOW primary source verification for all practitioners applying for DHA and DOH practice licences, to verify practice licence validity and scope before each placement, and to provide the facility with copies of the practice licence, qualifications, and verification reports for each placed staff member. The agency must notify the facility immediately if a staff member's licence is suspended, revoked, or subject to conditions.
Employment arrangement and employer-of-record identification must state clearly whether the agency employs staff and seconds them to the facility (agency employment model) or the facility employs staff directly following placement (permanent placement model). The employer of record under the Labour Law (Federal Decree-Law No. 33 of 2021) bears the statutory obligations including MOHRE registration, salary payment through WPS, leave entitlements, and end-of-service gratuity under Article 51.
Work order mechanism must describe how individual placements are initiated — typically through written work orders agreed by both parties that set out the role, the placed staff member's name and licence number, the assignment period, and the applicable fee.
Fee structure and VAT must state the agency's fee for each category of staff — placement fee, hourly or monthly rate — express fees exclusive of VAT at 5% under the VAT Law (Federal Decree-Law No. 8 of 2017), and require the agency to issue compliant tax invoices meeting Federal Tax Authority (FTA) requirements.
Medical liability must confirm that the licensed facility is responsible for clinical supervision and safe practice of placed staff under Medical Liability Federal Law No. 4 of 2016, while the agency is responsible for vetting, credentialling, and supplying appropriately licenced and insured staff. Neither party's obligations under Federal Law No. 4 of 2016 are limited by the commercial terms of the staffing agreement.
Data protection must address the agency's and the facility's obligations as controllers and processors of personal data of placed staff under the Personal Data Protection Law (Federal Decree-Law No. 45 of 2021), and the facility's obligations regarding patient data accessed by placed staff.
Termination must address notice-based termination for convenience, immediate termination on regulatory suspension, termination for material breach, and the treatment of individual placement work orders on master agreement termination.
How to Fill Out Your Healthcare Staffing Agreement (UAE)
Completing a Healthcare Staffing Agreement for the United Arab Emirates requires the agency to confirm its licensing status and vetting capacity, and the facility to confirm its healthcare facility licence and the categories of staff it requires.
Begin with the parties. Enter the agency's full legal name, trade licence number, and MOHRE private recruitment agency licence number. Enter the facility's full legal name and healthcare facility licence number from the Dubai Health Authority, the Department of Health Abu Dhabi, the Ministry of Health and Prevention, or the Sharjah Health Authority as applicable. Record the registered address of each party.
Enter the date of the agreement in DD/MM/YYYY format.
Describe the staffing categories. List each category of healthcare staff the agency is authorised to supply — registered nurses, allied health professionals, healthcare assistants, locum doctors — and confirm the practice licence requirement for each category. The categories must align with the facility's clinical needs and the agency's verified sourcing capability.
Describe the vetting obligations. List the documents the agency must verify and provide to the facility before each placement commences: practice licence (DHA, DOH, MOHAP, or SHA), DATAFLOW verification report, academic qualifications, professional references, and background clearance. Confirm the notification obligation where a staff member's licence status changes.
Set the start date and term. State the duration and the automatic renewal or notice provisions.
Select the employment arrangement from the dropdown: agency employment with secondment, permanent placement, or both.
Set the fee structure. State the placement fee or hourly rate in AED for each category. Confirm VAT at 5% is charged on top of all fees and require the agency to issue compliant tax invoices.
Select the applicable regulatory authority — DHA, DOH, MOHAP, or SHA.
Set the termination notice period and include immediate termination triggers.
Select the governing courts and arrange signatures. Electronic signatures are valid under the Electronic Transactions and Trust Services Law (Federal Decree-Law No. 46 of 2021). Keep signed copies and vetting records on file.
Legal Requirements for Healthcare Staffing Agreement (UAE)
A Healthcare Staffing Agreement in the United Arab Emirates operates within a multi-layered legal framework that the parties must understand.
The Labour Law (Federal Decree-Law No. 33 of 2021), enforced by the Ministry of Human Resources and Emiratisation (MOHRE), governs the employment relationship with placed workers. Article 51 requires end-of-service gratuity to be paid to workers who complete at least one year of service. Cabinet Resolution No. 1 of 2022 sets out the implementing regulations. The employer of record — whether the agency or the facility — bears all Labour Law obligations. MOHRE's Wages Protection System (WPS) requires monthly salaries to be paid electronically through approved payment services.
Cabinet Resolution No. 13 of 2021 on private employment agencies requires agencies that recruit and place non-UAE national workers to hold a MOHRE private recruitment agency licence and to comply with the conditions of that licence, including prohibitions on charging fees to workers and obligations to use standard employment contract templates.
Medical Liability Federal Law No. 4 of 2016 applies to all clinical staff placed at the facility. The facility is jointly liable with the practitioner for harm occurring on its licensed premises. The Medical Liability Committees at federal and emirate levels hear complaints. All practitioners must maintain professional indemnity insurance.
Practitioner licensing requirements are set by: the Dubai Health Authority under Dubai Law No. 13 of 2009 for Dubai facilities; the Department of Health Abu Dhabi under Abu Dhabi Law No. 23 of 2005 as amended; the Ministry of Health and Prevention under Federal Law No. 4 of 1983; and the Sharjah Health Authority. DATAFLOW primary source verification is mandatory for DHA and DOH licence applications.
The UAE Civil Code (Federal Law No. 5 of 1985) governs the commercial contract. The Personal Data Protection Law (Federal Decree-Law No. 45 of 2021) applies to personal data of staff and patients. The VAT Law (Federal Decree-Law No. 8 of 2017) applies the standard rate of 5% to staffing services. The Electronic Transactions and Trust Services Law (Federal Decree-Law No. 46 of 2021) validates electronic execution.
Common Mistakes to Avoid in Your Healthcare Staffing Agreement (UAE)
A UAE Healthcare Staffing Agreement governs a legally complex relationship involving commercial contract law, employment law, and healthcare regulation simultaneously. The following mistakes generate regulatory exposure or commercial disputes.
1. No MOHRE private recruitment agency licence check. An agency without a valid MOHRE private recruitment agency licence is operating unlawfully in placing expatriate workers. The facility that engages an unlicensed agency risks regulatory sanctions from MOHRE and the relevant health authority. Verify the agency's MOHRE licence before execution.
2. Placing staff without verified practice licences. The most serious mistake in healthcare staffing is allowing unlicensed or incorrectly-scoped practitioners to work on the facility's licensed premises. Every clinical staff member must hold a valid practice licence from the DHA, DOH, MOHAP, or SHA before commencing clinical duties, and the agreement must impose this obligation on the agency. Failure can result in Medical Liability Federal Law No. 4 of 2016 liability and DHA or DOH facility licence sanctions.
3. Omitting DATAFLOW verification requirement. DHA and DOH require DATAFLOW primary source verification for all practitioner licence applications. An agreement that does not require the agency to complete and provide DATAFLOW reports before placements leaves the facility without evidence of credential authenticity in the event of a Medical Liability Committee investigation.
4. Ambiguity about the employer of record. Failing to clearly identify whether the agency or the facility is the employer of record for each category of staff creates confusion about who bears the Labour Law (Federal Decree-Law No. 33 of 2021) obligations — WPS salary payments, MOHRE registration, leave entitlements, and end-of-service gratuity under Article 51. Ambiguity in this area can lead to MOHRE penalties and worker claims.
5. Not addressing medical liability allocation. An agreement that does not confirm the facility's responsibility for clinical supervision and the agency's responsibility for vetting and credentialling leaves a gap when harm occurs. Both the facility and the agency need to understand their obligations under Medical Liability Federal Law No. 4 of 2016.
6. Incorrect VAT treatment. Staffing services are standard-rated at 5% under the VAT Law (Federal Decree-Law No. 8 of 2017). An agency that does not charge VAT on its fees when VAT-registered will be assessed by the Federal Tax Authority.
7. No immediate termination right on regulatory action. Without an immediate right to terminate when a placed staff member's practice licence is suspended or when the facility's own licence is subject to regulatory action, the commercial agreement continues to bind the parties even when clinical practice at the facility may be unlawful.
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Reference this free template in an article, syllabus, or research note:
Forms Legal. (2026). Healthcare Staffing Agreement (UAE) (United Arab Emirates) [Legal document template]. Forms Legal. https://forms-legal.com/uae/business/contracts/healthcare-staffing-agreement-uae
"Healthcare Staffing Agreement (UAE) (United Arab Emirates)." Forms Legal, 2026, https://forms-legal.com/uae/business/contracts/healthcare-staffing-agreement-uae.
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author = {{Forms Legal}},
title = {Healthcare Staffing Agreement (UAE) (United Arab Emirates)},
year = {2026},
howpublished = {\url{https://forms-legal.com/uae/business/contracts/healthcare-staffing-agreement-uae}},
note = {Free legal document template. Based on Medical Liability Federal Law No. 4 of 2016}
}Frequently Asked Questions
A healthcare staffing agency in the United Arab Emirates needs two categories of licence to operate lawfully. The first is a standard trade licence from the Department of Economic Development in the emirate where it operates — or a free-zone licence if operating within a designated free zone — covering the activity of employment services or healthcare staffing.
The second is a private recruitment agency licence issued by the Ministry of Human Resources and Emiratisation (MOHRE) under Cabinet Resolution No. 13 of 2021 (as amended) on private employment agencies. This licence is required for any agency that recruits non-UAE national workers — which applies to the vast majority of healthcare staffing in the UAE, given that the country's healthcare workforce is predominantly expatriate. The MOHRE licence imposes obligations on the agency regarding worker welfare, contract transparency, and compliance with the Labour Law (Federal Decree-Law No. 33 of 2021).
Beyond the commercial and MOHRE licences, healthcare staffing agencies must comply with the practitioner licensing requirements of the relevant health authority. The Dubai Health Authority, the Department of Health Abu Dhabi, and the Ministry of Health and Prevention each require healthcare practitioners to hold personal practice licences before working at licensed facilities. An agency placing unlicensed practitioners at a DHA or DOH-regulated facility exposes both itself and the facility to regulatory sanctions. The Healthcare Staffing Agreement should confirm that the agency holds all required licences and will verify the practice licences of all staff placed before they commence clinical duties.
DATAFLOW is a primary source verification service used by the Dubai Health Authority (DHA), the Department of Health Abu Dhabi (DOH), and the Ministry of Health and Prevention (MOHAP) to verify the academic qualifications, professional credentials, and employment history of all healthcare practitioners applying for UAE practice licences. The verification process requires the practitioner to submit their credentials to DATAFLOW, which contacts the issuing institutions directly — universities, licensing boards, and former employers — to confirm authenticity.
DATAFLOW verification is mandatory for all healthcare practitioners in Dubai applying for DHA practice licences and for all practitioners applying for DOH practice licences in Abu Dhabi. MOHAP requires equivalent primary source verification for practitioners applying for federal practice licences. The process typically takes three to six weeks and must be completed before the practice licence is issued.
For a healthcare staffing agency, DATAFLOW verification is a critical element of the vetting process because the agency is representing to the healthcare facility that each placed practitioner holds a valid practice licence based on verified credentials. An agency that places a practitioner whose credentials were fabricated or whose DATAFLOW report reveals discrepancies is liable to the facility for misrepresentation and may face regulatory sanctions from MOHRE and the relevant health authority.
The Healthcare Staffing Agreement should require the agency to provide the facility with the DATAFLOW verification report and the practice licence for each staff member before the placement begins, and to maintain these records in the event of a regulatory inspection or Medical Liability Committee investigation under Medical Liability Federal Law No. 4 of 2016.
The employer of record in a UAE healthcare staffing arrangement depends on the structure the parties agree. There are two principal models in the UAE market, each with different legal consequences under the Labour Law (Federal Decree-Law No. 33 of 2021), enforced by the Ministry of Human Resources and Emiratisation (MOHRE).
In the agency employment model, the staffing agency is the employer of record. The agency enters individual employment contracts with the healthcare workers, registers them with MOHRE under the agency's establishment card, obtains their work permits and visas, processes their salaries through the Wages Protection System (WPS), and is responsible for paying end-of-service gratuity under Article 51 of the Labour Law at the end of each employment contract. The agency then seconds the workers to the facility under the Healthcare Staffing Agreement. This model gives the facility flexibility — it can request workers to end their assignment without terminating employment — while the agency bears the full employment compliance burden.
In the permanent placement model, the agency introduces the worker to the facility, and the facility employs the worker directly under the facility's establishment card. The agency receives a placement fee (typically a percentage of the annual salary), and the facility becomes the employer of record from the start of employment, with full Labour Law obligations. In this model, the facility is responsible for MOHRE registration, visa, WPS salary payments, leave, and gratuity.
The Healthcare Staffing Agreement should specify which model applies and clearly identify who is the employer of record for each category of staff. The MOHRE requires the relationship to be accurately documented in the work permit application, and misclassification of the employer can result in penalties and complications in end-of-service gratuity calculations.
Medical liability for patient harm caused by an agency-placed practitioner in the United Arab Emirates is governed by Medical Liability Federal Law No. 4 of 2016, which establishes liability at both the individual practitioner level and the facility level, regardless of the employment arrangement.
The individual practitioner is personally liable under Article 4 of Federal Law No. 4 of 2016 where their conduct falls below the standard of a reasonably competent practitioner in the same specialty and circumstances. The Medical Liability Committees at federal and emirate levels — operating through the Dubai Courts and DHA in Dubai, and the Abu Dhabi Judicial Department and DOH in Abu Dhabi — assess the practitioner's conduct and determine liability. The practitioner must hold professional indemnity insurance as a condition of practice, regardless of whether they are employed by the agency, the facility, or are working as a locum.
The licensed facility — the Healthcare Facility in the staffing agreement — is jointly liable for harm that occurs on its premises and is connected with the care provided there. The facility cannot escape liability simply because the negligent practitioner was placed by a staffing agency rather than directly employed. The facility's obligation to ensure that all practitioners working on its premises hold valid practice licences from the Dubai Health Authority, the Department of Health Abu Dhabi, or MOHAP, and to provide adequate clinical supervision, makes the facility a co-responsible party in most cases.
The staffing agency may be liable to the facility under the Healthcare Staffing Agreement and Articles 282 and 389 of the UAE Civil Code where the harm resulted from the agency's failure to verify the practitioner's credentials, supply a practitioner with the appropriate licence, or disclose licence restrictions. The agreement should allocate these risks clearly and require both parties to maintain adequate insurance.
End-of-service gratuity in a UAE healthcare staffing arrangement is payable to every UAE-based worker under Article 51 of the Labour Law (Federal Decree-Law No. 33 of 2021), and the obligation falls on whoever is the employer of record for the worker.
Under Article 51, a worker who has completed at least one year of continuous service is entitled to gratuity calculated on the basis of 21 days' basic salary per year of service for the first five years, and 30 days' basic salary per year for each subsequent year, up to a maximum of two years' total salary. The gratuity is calculated on the basic wage, not the total package, and must be paid on termination of employment regardless of whether the termination is by the employer or by resignation.
In the agency employment model, the staffing agency is the employer of record and bears the gratuity obligation. The agency must accrue this liability over the course of the worker's employment and pay it on termination. The Healthcare Staffing Agreement should address whether the facility's fee structure contributes to the agency's gratuity accrual costs, because the fee must be set at a level that covers the agency's full employment overhead including gratuity.
In the permanent placement model, where the facility employs the worker directly, the facility is the employer of record and bears the gratuity obligation from the worker's first day of employment at the facility. The Healthcare Staffing Agreement should confirm this clearly to avoid any ambiguity about which party is responsible.
Under Cabinet Resolution No. 96 of 2023, the UAE has introduced an Alternative End of Service Gratuity scheme under which employers may enrol workers in a qualifying savings scheme instead of the traditional gratuity calculation. Healthcare facilities and staffing agencies should seek MOHRE guidance on whether they are eligible to enrol workers in this scheme.
Healthcare staffing services supplied by a staffing agency to a healthcare facility in the United Arab Emirates are subject to Value Added Tax under the VAT Law (Federal Decree-Law No. 8 of 2017) at the standard rate of 5%. The Federal Tax Authority (FTA) treats the supply of staffing services — including the placement of healthcare workers — as a commercial service from one business to another, which is a taxable supply at the standard rate.
The zero-rating for clinical healthcare services under Cabinet Decision No. 52 of 2017 applies to services supplied directly to patients by licensed healthcare providers, not to the intermediary staffing arrangement between the agency and the facility. Even though the workers placed by the agency will go on to provide zero-rated healthcare services to patients, the agency's supply to the facility of the staffing service itself is a standard-rated business-to-business transaction.
A VAT-registered staffing agency must charge 5% VAT on its placement fees and hourly rates, issue valid tax invoices meeting FTA requirements, and account for the VAT in its returns. The facility, as a VAT-registered healthcare provider, may recover the input tax on the staffing fees it pays to the extent that those fees relate to its taxable or zero-rated supplies — which for a mixed healthcare provider means a partial input tax recovery calculation.
The Healthcare Staffing Agreement should state that all fees are exclusive of VAT at the rate applicable from time to time, require the agency to issue compliant tax invoices, and set the payment period for the invoices. Failure to account for VAT correctly can result in FTA assessments and penalties for the agency.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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