Managing Ramadan & Public Holidays with HR Payroll Tools

Office bells and calendar alerts change more than you think when Ramadan comes around in the UAE. The government mandates changes in work rhythm that every HR and payroll team must account for. During the holy month of Ramadan, the Ministry of Human Resources and Emiratisation (MoHRE) shortens working hours for private sector employees by two hours daily. That changes how you calculate time, pay overtime, handle flexible shifts, and even plan leave around Eid and other public holidays.

It’s basically the intersection of religious observance and operational precision. That’s where smart HR Software becomes essential for any UAE business.

The Legal Backbone: Ramadan Working Hours in the UAE

One thing people forget until the payroll runs hit them - during Ramadan, the definition of a normal working day changes.

As we mentioned, under UAE labour law, private sector staff are entitled to a two-hour reduction in working hours every day of Ramadan. It means if your standard day is eight hours, that becomes six hours once Ramadan starts. This is the part of the federal labour framework overseen by MoHRE.

Even public sector and government entities adjust their schedules. Federal ministries often switch to mid-morning start times and finish earlier in the afternoon, with half-days on Fridays to help balance the workload and personal observances.

The reduction applies to everyone in the private sector because the labour rule is workplace-wide, not religiously specific.

That means you must rethink your baseline for attendance, accruals, time banks, and expectations across teams.

What Happens When People Work Beyond Ramadan Hours

Shorter official hours sound simple until someone works past them.

Any time worked beyond the legally reduced schedule during Ramadan is treated as overtime, and employers have to compensate employees accordingly. The UAE mandates a premium on such overtime, generally 25% above the normal hourly wage for daytime finals. If the extra hours fall into the late-night window (typically 10 pm to 4 am), the premium goes up to 50% above the normal rate.

Simplify Ramadan Work Hour Adjustments

Automatically manage reduced working hours, flexible shifts, and overtime calculations during Ramadan without manual errors. Ensure full compliance with UAE labor laws while keeping payroll accurate and stress free.

If your Payroll Software doesn’t flag overtime properly once employees exceed the six-hour day, you’re either underpaying (and breaking the rules) or correcting expensive manual errors after the fact.

You should also know that, unless it’s an urgent & unavoidable situation, employees cannot be forced to work beyond Ramadan hours.

Sweeping Public Holidays in the UAE: What They Mean for HR and Payroll

Ramadan connects closely to public holidays because it culminates in Eid al-Fitr, which is an official UAE public holiday. And beyond that, the UAE calendar includes several statutory leaves recognized for all workers, such as Eid al-Fitr, Eid al-Adha, Islamic New Year, Prophet Muhammad’s Birthday, National Day, and more.

Here’s what HR teams need to keep in mind:

Paid public holidays must be recorded as leave with full pay per UAE law.

If someone works on an official holiday, the law requires compensation that includes either a paid compensatory day off or additional pay at a minimum 50% premium over the normal daily wage.

These rules apply in both private and public sector settings, and your policies should say so in clear terms.

Too often, businesses treat public holidays the same as regular days in their software, which leads to incorrect payslips and questions from employees. So, make sure your HR rules around paid holidays are distinct and compliant.

Why Manual Systems Break Down Fast

Before entering Ramadan or a holiday season, many companies still rely on spreadsheets or generic time clocks instead of HRMS Software.

That’s why they face a few common issues:

Ramadan work hours aren’t reflected, so employees get docked incorrectly, or payroll overpays for hours.

Manual systems often lack the triggers for extra rates, so you can’t calculate overtime with legal premiums.

Public holiday entitlements are mixed with annual leave. It creates confusion and extra admin work.

As a result, your HR teams need to spend weeks reconciling payslips, answering queries, and fixing errors that reliable software could’ve prevented.

Accurate Public Holiday Payroll Processing

Handle public holiday pay, leave tracking, and compensatory offs with smart HR and payroll automation. Avoid salary disputes and ensure every employee is paid correctly and on time.

What HR and Payroll Tools Should Do

Modern HR and payroll platforms do two important jobs during Ramadan and holiday periods:

First, they pre-configure compliance.

This means your systems automatically apply:

The two-hour work reduction for Ramadan dates.

Triggers overtime if any of your employees cross the Ramadan working hour limits.

Holiday premium rates are paid when people work on official holidays.

Once this is set, your software starts enforcing the rules your team already wants.

Second, they enable flexible work with clarity.

Ramadan often brings remote or staggered shift requests. Best HR Software in the UAE lets employees self-service requests and managers approve them in-app.

Ramadan and public holidays in the UAE aren’t just small calendar changes. They redefine work hours, shift expectations, and payroll calculations, and where systems fail, people feel the impact. Using time attendance, HR, and payroll tools that understand the legal framework frees you from struggling every year.

So, do you want smoother Ramadan and holiday payroll runs?

Then start by auditing your HR tool’s rules for reduced hours, overtime premiums, and holiday pay. Those few adjustments now will save hours of manual corrections later and help you earn serious credibility with your teams.

FAQs

Is using spreadsheets during Ramadan a bad idea?

Not “bad,” but obviously risky. Reduced hours, overtime, and holiday pay all overlap during this period. One small mistake in a sheet can throw off someone’s payslip, and then HR ends up struggling with corrections.

Do the government and private sectors follow the same Ramadan timing?

Both shorten the day, but government departments often announce their own timings every year. Private companies go with the standard two-hour reduction that everyone knows.

What should HR do before Ramadan actually starts?

A quick review is enough. Update the Ramadan schedule, check overtime rules, confirm the holiday calendar, and make sure attendance devices match those timings.

Stay Compliant Across the Middle East

Manage multi-country holiday calendars, labor rules, and payroll structures from one centralized HR system. Perfect for businesses operating across the UAE and GCC region.