The Dubai Court docket of First Occasion has affirmed the legality of crypto funds for salaries underneath employment contracts in a landmark ruling on Aug. 15.
The ruling, issued in case quantity 1739 of 2024 (Labour), marks a major shift within the UAE’s judicial strategy to digital currencies, reflecting the rising acceptance of crypto within the area.
Crypto wage dispute
The case concerned a dispute the place the plaintiff, an worker, claimed unpaid wages, wrongful termination, and different employment-related advantages.
The plaintiff’s contract specified a month-to-month wage in fiat forex alongside 5,250 EcoWatt tokens, a type of crypto. The court docket dominated in favor of the plaintiff, ordering the employer to pay the owed wage in EcoWatt tokens, citing the employer’s failure to offer proof of fee.
In response, the employer argued that the plaintiff had been terminated for legitimate causes and that the wage funds in EcoWatt tokens weren’t legally enforceable. Nonetheless, the court docket discovered that the employment contract clearly stipulated the fee in each fiat forex and crypto, and the employer had not offered enough proof to show that the EcoWatt tokens had been paid.
The ruling emphasizes the significance of clear contractual agreements and the UAE’s readiness to adapt to trendy monetary practices. It additionally marks the most recent step within the nation’s progressive strategy to adopting and regulating the crypto business.
Overturning earlier ruling
The choice contrasts sharply with the same case in 2023, wherein the identical court docket dismissed a declare involving EcoWatt tokens. In that occasion, the worker’s incapability to offer a transparent valuation of the crypto led to the court docket’s refusal to implement the fee.
The 2024 ruling highlights the court docket’s evolving stance on digital currencies. By recognizing crypto as a legitimate type of remuneration, the court docket has set a precedent that might encourage broader adoption of digital currencies in varied sectors, together with employment.
The choice was based mostly on Article 912 of the UAE Civil Transactions Legislation and Federal Decree-Legislation No. (33) of 2021, which governs the willpower and fee of wages.
Because the nation continues to place itself as a worldwide hub for innovation, this determination could pave the way in which for additional integration of digital currencies into the area’s authorized and financial frameworks.
