The Dubai Court of First Instance has confirmed the validity of using cryptocurrency for salary payments as stated in employment contracts, indicating a notable change in the UAE’s judicial stance towards digital currencies.
The verdict, delivered in case number 1739 of 2024 (Labour), pertained to a dispute in which an employee alleged non-payment of salary, unjustified termination, and other employment-related entitlements.
The plaintiff’s contract stipulated a monthly remuneration in traditional currency, as well as 5,250 EcoWatt tokens, which are a type of cryptocurrency. The court found in favor of the plaintiff, compelling the employer to remunerate the outstanding income in EcoWatt tokens due to the employer’s inability to substantiate the payment.
The employer contended that the plaintiff’s termination was justified and that the remuneration in EcoWatt tokens lacked legal enforceability. The verdict underscores the significance of unambiguous contractual agreements and the UAE’s willingness to conform to contemporary financial norms.
In 2024, the court’s decision is significantly different from a previous instance in 2023, where the court rejected a claim related to EcoWatt tokens because the employee was unable to accurately determine the value of the cryptocurrency.
The determination and payment of wages are governed by the decision, which is based on Article 912 of the UAE Civil Transactions Law and Federal Decree-Law No. (33) of 2021.
