The Dubai Court of First Instance has ruled that cryptocurrency can be legally used to pay salaries under employment contracts. This landmark decision represents a significant shift in the UAE’s legal stance on digital currencies, paving the way for broader economic use of crypto in the country.
The ruling arose from a case involving an employee seeking unpaid wages, which included payment in EcoWatt tokens as specified in the employment contract. The court ruled in favor of the employee, allowing the salary to be paid in cryptocurrency without requiring conversion to fiat currency.
This decision marks a departure from the court’s earlier position in 2023 when it blocked such payments due to the lack of a mechanism to determine fiat equivalency. In case number 1739 of 2024, the court’s stance reflects the growing acceptance of crypto as a legitimate payment method, aligning with the UAE’s evolving legal and economic framework.
The court’s ruling, based on the UAE Civil Transactions Law and Federal Decree-Law No. 33 of 2021, underscores that employment contracts are enforceable regardless of the currency used, setting a precedent for future digital currency transactions in the UAE.
Legal experts believe this decision could drive businesses to explore new payment methods, signaling broader adoption of digital currencies in various sectors. The ruling aligns with the UAE’s vision of becoming a global hub for the future economy and encourages the expansion of crypto usage in business operations.
The decision also highlights the importance of clear contractual terms, urging employers to specify payment methods—whether fiat or cryptocurrency—in employment agreements. This ruling is expected to influence how companies draft contracts, particularly in cutting-edge sectors embracing digitalization and blockchain technology.
By providing a legal framework for crypto payments, the UAE is demonstrating its readiness for economic innovation, potentially setting a trend for other jurisdictions to follow.
Featured image from: havenproperties.com