What a new hire really costs a UAE company
Salary is the number everyone quotes and the smallest part of the decision. Here are the eight line items behind every UAE hire, and how to put a real number on each.
The eight line items
I spent seven years in Dubai, long enough to watch the same pattern repeat in company after company. The work grows. You need another person. Then you start counting what a person actually costs, and the answer is never just the salary.
These are the eight items that attach to a hire. Your numbers depend on the role, the emirate, your lease and your sector, so treat the third column as a guide to finding your own figure, not as a price list.
| Line item | What it is | How to estimate it |
|---|---|---|
| 1. Salary | Base pay and any agreed allowances | Your offer, plus housing or transport allowances if you pay them |
| 2. Visa | Employment visa, Emirates ID, medical fitness and related government and typing fees, repeated at renewal | Ask your PRO or typing centre for the current total, and add the renewal cycle |
| 3. Insurance | Health cover for the employee, which is a requirement in some emirates | Get a quote from your insurer for the employee’s age band |
| 4. Gratuity | End-of-service entitlement that builds up with length of service and is paid at the end of employment | Ask your adviser for the current rules and accrue a monthly provision |
| 5. Recruitment fee | Agency fee, or the cost of advertising and interview time if you hire directly | Agencies often charge a percentage of annual salary; check your agreement |
| 6. Desk | Furniture, laptop, software licences, phone | Add up your last purchase of each |
| 7. Office space | The share of your lease the person occupies | Lease cost per square foot multiplied by the space one person needs |
| 8. Management time | The hours you or a manager spend recruiting, onboarding and supervising | Hours per week multiplied by what an hour of your time is worth |
Why three hires is a lease decision
The first four items scale with each person. Items six and seven do not scale smoothly, because space is bought in blocks. Hire a third person and you may be told the room is full, which turns a hiring decision into a lease decision: a bigger office, a higher rent, a longer commitment and a fit-out.
The Lydon cost page uses an illustrative 10-seat example taken from the company profile, with 1,200 square feet of office space, and scales it by the number of seats you choose. Space per seat is assumed equal, so treat it as an illustration of how the line items stack, not a quotation.
Do the sum for your own business
- Open a spreadsheet with the eight rows above and three columns: one hire, three hires, ten hires.
- Fill in each row with real quotes from your PRO, insurer, agency and landlord.
- Convert the lease and your own time into monthly figures, so everything is per month.
- Add the rows. The total, divided by the salary, is your real multiplier.
- Add a ninth row: what it costs you to undo the hire if it does not work out. That row, the notice, the gratuity, the visa cancellation and the lease you still hold, is the one most owners forget.
Doing this once, honestly, usually changes how owners think about the next hire.
What the alternative looks like
Lydon’s model replaces the stack with one line. You pay one rate per seat, which covers the people, the supervised office and the day-to-day operations, and you manage the work. The rate depends on the role, so we send the complete monthly cost with your screened candidates, and you compare it against your own sum.
Exit also gets simpler. You give 30 days’ notice. There is no gratuity liability to unwind, no visa cancellation and no lease you still hold. A wrong fit in the first 30 days gets a free replacement.
This is not the right answer for every role. Work that must be done in person in the UAE, or that requires a UAE licence, stays with a local hire. For screen-based work, compare your sum with one rate.
Questions, answered
Is the UAE gratuity the same for every employee?
No. It depends on the contract type and length of service, and the rules can change. Ask your PRO or adviser for the current position before you budget.
Do I have to pay for health insurance?
Employers are required to provide it in some emirates. Check the rule for your emirate and your employee’s status.
Does Lydon quote a price on the website?
No. The monthly rate depends on the role. We send the complete monthly cost with your screened candidates.
Start with one seat
Tell us the role. We send screened candidates together with the complete monthly cost. If it works, add a second. If it doesn’t, you’ve lost 30 days’ notice and nothing else.