Dubai Court Rules “Salaries Can Be Paid in Cryptocurrency”
A new ruling from the Dubai Court of First Instance has confirmed that salaries in the UAE can be paid in cryptocurrency, provided the terms are clearly specified. This judgment, issued in case number 1739 of 2024 (labour), follows a prior case from 2023 where a similar claim was initially rejected by the court.
The earlier case, discussed in a note published by the law firm Wasel & Wasel, involved an employee whose contract specified payment in both fiat currency and EcoWatt tokens, a type of cryptocurrency. The plaintiff’s employment contract detailed a monthly salary consisting of fiat currency along with an additional 5,250 EcoWatt tokens.
The legal dispute arose because the employer failed to pay the EcoWatt token portion of the salary for six months, leading to allegations of wrongful termination. In 2023, the Dubai Court of First Instance dismissed the claim, citing the absence of a precise valuation for the EcoWatt tokens. At that time, the court required concrete evidence of the digital currency’s value in fiat terms, reflecting a more traditional approach to financial disputes.
However, in a more progressive development, the court’s 2024 ruling in a similar case required the employer to compensate the employee with both the overdue fiat currency and the unpaid EcoWatt tokens. It is not confirmed whether the defendant in this case is the same company involved in the 2023 case.
Despite this, Mahmoud Abuwasel of Wasel & Wasel described the ruling as a “significant step forward.” He emphasized that the court is now recognizing and enforcing cryptocurrency as part of wage payments, provided the contract terms are explicitly defined.
This decision underscores the importance of having clear and precise terms in employment contracts to cover both traditional and digital forms of payment. Abuwasel noted that this evolution in legal interpretation is a positive development for integrating cryptocurrencies into business practices, setting a precedent for future cases and highlighting the UAE’s commitment to adapting to the changing financial landscape.
