Dubai Court Approves Cryptocurrency for Salary Payments, Emphasizing Need for Clear Contract Terms
Dubai Court of First Instance has ruled that wages in the UAE can be paid in cryptocurrency, provided the terms are clearly defined in employment contracts. This ruling, issued in case number 1739 of 2024 (labour), marks a significant shift in the legal landscape, reinforcing the acceptance of digital currencies as a legitimate form of payment.
The decision follows a similar case from 2023, where the court initially rejected a claim involving cryptocurrency due to the lack of precise valuation in fiat terms. In that case, the employment contract included both traditional currency and EcoWatt tokens, a type of cryptocurrency. The dispute arose when the employer failed to pay the cryptocurrency portion of the salary, leading to a legal challenge.
However, in the 2024 ruling, the court took a more progressive stance, ordering the employer to compensate the worker with both the outstanding fiat currency and the missing EcoWatt tokens. This marks a shift towards the acceptance and enforcement of cryptocurrency as part of wage payments in the UAE.
Legal experts, including Mahmoud Abuwasel, Managing Partner at Wasel & Wasel, have hailed the decision as a “significant step forward” for the integration of cryptocurrencies in business practices. Abuwasel noted that the ruling highlights the importance of clear and precise contractual terms to ensure that both traditional and digital forms of payment are adequately addressed in employment agreements.
“This evolution in legal interpretation is a positive development for the integration of cryptocurrencies in business practices,” Abuwasel said. “It sets a precedent for future cases and underscores the UAE’s commitment to adapting to the changing financial landscape.”
The ruling is expected to influence future legal interpretations and contribute to the broader acceptance of digital currencies in the UAE’s evolving financial ecosystem.
Source: https://gulfbusiness.com/salaries-cryptocurrency-dubai-court-uae/
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