Manpower Supply License

What is a Manpower Supply License?

A manpower supply license in the UAE is a regulatory approval that allows a company to legally supply workers to third-party organisations on a temporary, project-based, or contractual basis. This license enables manpower suppliers to recruit, sponsor, and deploy employees to client sites while remaining the legal employer of record.

Manpower supply activities are regulated by the Ministry of Human Resources and Emiratisation (MOHRE) and are subject to strict compliance requirements to protect employee rights and ensure lawful workforce practices.

Purpose of a Manpower Supply License

The manpower supply license exists to:

• Regulate the temporary and outsourced workforce in the UAE

• Prevent illegal labour supply and worker exploitation

• Ensure clear accountability for wages, benefits, and compliance

• Enable businesses to meet fluctuating or short-term staffing needs

It is commonly used by organisations that require flexibility without committing to long-term employment contracts.

Who Requires a Manpower Supply License?

A manpower supply license is required by any company that:

• Supplies employees to work under the supervision of another entity

• Provides temporary, project-based or contract staff

• Operates as a labour supplier, staffing agency, or workforce outsourcing provider

Industries that frequently use manpower supply services include:

• Construction and engineering

• Facilities management

• Hospitality and events

• Logistics and warehousing

• Retail and customer service

How Manpower Supply Works

Under a manpower supply arrangement:

• The manpower supplier remains the legal employer
• The client company supervises day-to-day work

The supplier is responsible for:

• Employment contracts

• Payroll and wages

• Visas and work permits

• Insurance and benefits

• Compliance with labour law

This structure allows client companies to access labour without assuming full employment obligations.

Key Legal and Compliance Requirements

To obtain and maintain a manpower supply license, companies must:

• Be licensed by the relevant economic authority (DED or Free Zone)

• Obtain approval from MOHRE

• Meet financial guarantees or bank guarantee requirements

• Maintain compliant employment contracts

• Pay wages through the Wages Protection System (WPS)

• Provide suitable accommodation where applicable

• Ensure health insurance and workplace safety compliance

Failure to comply may result in license suspension, fines, or blacklisting.

Manpower Supply License vs EOR Services

While similar, manpower supply and Employer of Record (EOR) services are distinct:

• Manpower supply involves supplying labour to work under the client’s supervision.

• EOR services typically cover long-term employment where the EOR acts as the legal employer without labour supply arrangements.

Understanding the difference is critical for compliance and structuring workforce solutions correctly.

Employee Protections

Employees supplied under a manpower supply license are entitled to:

• Lawful employment contracts

• Timely salary payments

• Statutory leave entitlements

• End-of-service gratuity

• Health and safety protections

Their rights remain protected under UAE Labour Law, regardless of where they are deployed.

Best Practices for Businesses

1. Engage Licensed Providers Only
   Always verify that the manpower supplier holds a valid MOHRE-approved license.

2. Clearly Define Responsibilities
   Contracts should specify roles, liabilities, and compliance obligations.

3. Monitor Compliance Regularly
   Ensure wages, visas, and insurance remain valid.

4. Avoid Illegal Labour Supply
   Using unlicensed suppliers can result in severe penalties.

5. Maintain Transparency with Workers
   Employees should clearly understand who their legal employer is.

Conclusion

A Manpower Supply License plays a vital role in regulating temporary and outsourced employment in the UAE. It enables businesses to remain flexible while ensuring worker protections and labour law compliance.

For employers, HR teams, and operations managers, understanding the legal framework governing manpower supply is essential to avoiding risk and maintaining compliant workforce operations.