Middle East Operational Resilience | People Matters in the Current Situation

The UAE and wider GCC remain in a “business as usual” position, with no formal directives requiring evacuation or suspension of business operations. However, the position is nuanced in practice, with foreign government travel advisories, employee concerns and sector-specific pressures continuing to influence decision-making. Many organisations have now moved beyond initial crisis response and are focusing on medium-term planning, including workforce distribution, cost management and operational resilience, particularly in sectors more directly impacted by reduced travel or market uncertainty.

Remote Working – Evolving Practice and Risk 

Remote working remains a key tool for maintaining business continuity, including in some cases cross-border remote working arrangements. However, employers are increasingly moving towards more structured approaches, introducing formal approval processes, time limits and clearer expectations around return to the contractual place of work.  

These arrangements give rise to a number of risks, particularly where employees are working abroad for extended periods. These include tax exposure (including potential permanent establishment risk), payroll and social security obligations, as well as practical challenges where employees are reluctant to return. Employers should therefore ensure that such arrangements are carefully managed, documented and clearly positioned as temporary. If an employee works from a country where the employer has another office, caution should be exercised on whether the individual becomes integrated into operations in that country eg attending the office and working with colleagues on both GCC and in country projects.

Visa and Immigration Considerations 

From a UAE/Qatar/KSA perspective, there have been no widespread suspensions of visa processing or employment permits, and immigration systems continue to operate broadly as normal. Automatic visa extensions and waiver of overstay fines until the end of March 2026 were put in place. However, employers are monitoring developments closely, particularly in relation to nationality-specific restrictions, additional documentation requirements and processing delays in certain cases; with a possibility that certain nationalities will require a certificate of good conduct as part of the documents required for a UAE work permit and residency visa going forward (this is already a set requirement for all in KSA).

A key practical issue arises where employees have relocated outside the GCC region and are hesitant or unwilling to return. In these cases, the position is generally that employees remain contractually required to work in their designated country of employment, and employers may, subject to local law and reasonableness, require a return to the region be it UAE, KSA or Qatar.  

For employees considering relocation or evacuation, employers should assess:  

• visa validity and re-entry requirements;  

• potential restrictions in alternative jurisdictions (including third-country relocation options); and  

• the implications of extended absence from the UAE/KSA/Qatar on residency status and employment arrangements.  

While some employers are accommodating temporary relocation requests, this is typically being managed within clear policy frameworks, with the expectation that employees will return when reasonably required. 

Employer Liability – HSE Perspective

A key consideration is that employer health and safety obligations remain unchanged, regardless of where employees are working. These obligations are inherent to the employment relationship and cannot be waived or avoided, including through employee consent, relocation decisions or waivers.  

Importantly, the concept of the “workplace” is interpreted broadly and extends beyond the traditional office environment to include work-related travel, commuting and remote working arrangements. As a result, employers may remain liable for incidents that occur during the course of employment or arising out of work duties, even where employees are working from home or abroad.  

While the practical risk profile may be lower in remote settings, particularly where employees are not exposed to physical workplace hazards, this does not remove the underlying legal exposure from an HSE perspective.

Insurance – Coverage Gaps and Emerging Risks 

From an insurance perspective, a key takeaway is that liability and insurance coverage do not always align. While an employer may be liable for a work-related incident, the relevant insurance policy may not respond, depending on its terms and exclusions.  

Employers should therefore review their policies carefully, in particular:  

• whether remote and overseas working arrangements fall within the definition of the workplace;  

• any territorial limitations, which may restrict cover to specific jurisdictions (eg the country where the employing entity is located and the employee is contracted to work); and  

• exclusions, particularly in relation to war, political violence or high-risk scenarios, which may be highly relevant in the current context.

Medical insurance should also be carefully considered. While employer-provided health insurance will typically cover treatment within the UAE/KSA/Qatar (and sometimes internationally), coverage may be limited outside the UAE/KSA/Qatar or subject to exclusions, particularly in higher-risk or conflict-related scenarios. Employers should ensure that medical cover remains valid for the employee’s actual location, including where employees are working abroad, and be aware that certain risks (including war-related incidents) may not be covered under standard policies. 

In addition, remote working increases cyber risk exposure, given the reliance on home networks, personal devices and less controlled IT environments. While cyber policies may extend to remote working, coverage will depend on whether adequate security measures and internal controls are in place in practice.

Tax Considerations – Remote Working Abroad

The use of cross-border remote working arrangements introduces tax risks, particularly where employees are working from jurisdictions outside the UAE. In certain circumstances, this may give rise to a permanent establishment, exposing the employer to corporate tax obligations in the host country.  

Risk is typically higher where employees are senior, client-facing or involved in revenue-generating activities, and where arrangements continue for a prolonged period. Employers may also face local payroll withholding and social security obligations, depending on the jurisdiction.  Payroll must continue to be run in country (UAE/KSA/Qatar) with any period of nonpayment or reduced payment being documented with the authorities and registered with the wages protection systems.  

To mitigate these risks, employers should monitor the duration and nature of overseas working arrangements, ensure that they are clearly documented as temporary, and consider whether any restrictions should be placed on the activities undertaken by employees while abroad. Employees should be liable for their own personal income tax and one measure which could possibly be considered is putting such employees on a consultancy engagement during extended periods of working outside of the country they are contractually agreed to work as employees.

Key Takeaways 

• There is no single “correct” approach – responses must be tailored, pragmatic and risk-based, taking into account sector, workforce profile and operational needs.
• Employer obligations, particularly from an HSE perspective, are broad, location-agnostic and cannot be waived, extending to remote working and cross-border arrangements.
• There is a clear disconnect between liability and insurance coverage, particularly in relation to overseas working and war or political risk exclusions, which employers should actively review.
• Remote working abroad introduces interconnected risks across employment, immigration, tax and insurance frameworks, including potential permanent establishment exposure and regulatory obligations.
• In response, employers are increasingly adopting practical workforce measures, including:
  • restricting non-essential travel;
  • implementing structured remote working and relocation policies;
  • requiring use of annual leave or unpaid leave where appropriate;
  • reviewing protections for critical or frontline roles; and
  • reinforcing employee communications and wellbeing frameworks.
• Consistent with regional practice, employers should continue to consider measures short of termination before taking more drastic steps, ensuring any actions are properly documented and implemented in compliance with applicable laws.

Closing 

The current environment continues to evolve rapidly, requiring employers to take a dynamic and coordinated approach across employment, HSE, insurance and tax considerations.

In practice, this means regularly reviewing workforce strategy, ensuring clear policies, documentation and communication, and maintaining a focus on both employee wellbeing and operational resilience.

There is no one-size-fits-all solution, and responses will need to be adapted as circumstances develop. Please contact Sara Khoja or Sarit Thomas if you would like to discuss any of these issues in more detail.

Periods of regional uncertainty rarely create risk in isolation. We help organisations understand how different risks connect and what that means in practice, so decisions can be made with clarity and confidence. If you have questions about your Middle Eastern operations or would value support navigating the current environment, please reach out to your known Clyde & Co contact or using the button below.

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