In a groundbreaking decision, a Dubai court has ordered a company to pay an employee her outstanding dues in both UAE dirhams and cryptocurrency, as stipulated in her employment contract. The ruling, issued by the Dubai Courts of First Instance, marks a significant development in the evolving financial landscape of the United Arab Emirates.
The case, numbered 1739 of 2024, involved an employee who filed a lawsuit against her employer for arbitrary dismissal and non-payment of wages. The employee’s contract specified that her salary would be paid in a combination of UAE dirhams and EcoWatt Tokens, a form of cryptocurrency. Following the court’s ruling in favor of the employee, the company was ordered to pay the owed salary in EcoWatt Tokens as well.
Legal experts have hailed the decision as a milestone in the UAE’s legal and economic framework. Mahmoud Abuwasel, Managing Partner at Wasel and Wasel, highlighted that the dispute centered around the employer’s failure to pay 5,250 EcoWatt Tokens over six months, in addition to the alleged wrongful termination of the employee. He emphasized that the court’s ruling affirms that cryptocurrency can be a legally valid form of compensation.
Navandeep Matta, a Senior Associate at Kochhar & Co Inc. Legal Consultants, noted that the ruling underscores the flexibility of wage payment mechanisms in the UAE. The decision builds on the legal principles established by Federal Decree-Law No. (33) of 2021, which governs labor relations in the country. Matta explained that the court’s acceptance of cryptocurrency as part of an employee’s salary reflects a broader trend toward the integration of digital currencies into the UAE’s financial system.
Irina Heaver, a partner at NeosLegal, clarified that while the ruling recognizes project tokens as a legitimate form of compensation, it does not alter the fact that the UAE dirham remains the only legal tender in the country. She pointed out that salary payments must still be registered with the Wage Protection System (WPS), which operates exclusively in AED. The case, she said, pertains to additional employee benefits, such as bonuses or shares, that may be promised by the employer.
The ruling follows a 2023 case where the court acknowledged the inclusion of EcoWatt Tokens in an employment contract but ultimately refused to award the tokens as part of the settlement. The 2024 decision, however, reflects the UAE courts’ readiness to adapt to the changing financial landscape and embrace modern financial practices.
As cryptocurrencies continue to gain acceptance in the UAE, experts anticipate their use will expand into various sectors, including real estate, retail, and government services. This evolution is expected to drive innovation and create new opportunities, further solidifying the UAE’s position as a global leader in adopting cutting-edge financial technologies.
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