New UAE Civil Code reshapes employment dispute standards — all employers — effective 1 June 2026
Federal Decree-Law No. 25 of 2025 replaced the 1985 Civil Code on 1 June 2026, introducing stricter standards around consent, disclosure, reliance and fairness in employment matters. The UAE Labour Law remains primary, but the New Civil Code will now shape how employment disputes are determined, particularly in recruitment, negotiations and settlements.
The analysis — automated & source-checked
- Applies to
- Labour · UAE
- What to do
- Review and update employment contracts, recruitment processes, and negotiation templates to ensure compliance with good-faith requirements under Article 121 and other provisions of the New Civil Code. Strengthen documentation of all pre-contractual and contractual communications.
Article 121 of the New Civil Code expressly regulates pre-contractual negotiations for the first time, requiring parties to negotiate and withdraw from negotiations in good faith. While the changes are not expected to result in a radical departure from existing employment practices, they are likely to increase the importance of careful drafting, documentation and process discipline, particularly during recruitment, negotiations and settlement discussions.
Source
“Federal Decree-Law No. 25 of 2025 (the New Civil Code) came into force on 1 June 2026, replacing the 1985 Civil Code.”
— Clyde & Co Middle East, 11 Jun 2026
Reported by: Clyde & Co Middle East 11 Jun 2026 Read the original ↗ More from Clyde & Co Middle East →
Quick answers
What do I need to do?
Review and update employment contracts, recruitment processes, and negotiation templates to ensure compliance with good-faith requirements under Article 121 and other provisions of the New Civil Code. Strengthen documentation of all pre-contractual and contractual communications.
Who reported this?
Clyde & Co Middle East (UAE).
When was it announced?
11 Jun 2026.
Where can I read the original?
Read the original at Clyde & Co Middle East: https://www.clydeco.com/en/insights/2026/06/new-uae-civil-code-key-employment-considerations
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