- Dubai court's ruling contrasts with decision from 2023.
- Ruling recognises contractual agreements regarding crypto salaries.
- Decision comes as Dubai is remaking itself into a crypto hub.
The Dubai Court of First Instance recognised crypto payments for salaries under employment contracts in a landmark ruling, according to a posting by the Wasel & Wasel law firm.
The ruling marked a shift in the UAE’s judicial approach to digital currencies, reflecting a growing acceptance of crypto. Specifically, it contrasts with a previous judgement by the same court in 2023, when a similar claim involving crypto was denied due to the employee’s failure to provide a precise valuation of the digital currency.
The recent case arose when a plaintiff filed a lawsuit claiming wrongful termination and unpaid wages. The plaintiff’s employment contract stipulated a monthly salary in fiat currency and an additional 5,250 EcoWatt tokens, a form of crypto. The employer argued that the salary payments in crypto were not legally enforceable.
This time, the court ruled in favour of the employee, not only recognizing the validity of payment in crypto, but also ordering the payment to be made in EcoWatt tokens rather than converting it into fiat currency. The employee’s name was not revealed in the posting.
The ruling comes as Dubai is remaking itself into an international crypto hub. The city has a bespoke regulatory framework for digital-asset companies, DL News has reported. Not to mention the Dubai International Financial Centre, an economic free zone where companies can operate with less red tape.
“This ruling marks a significant shift in the court’s approach, demonstrating a greater acceptance of cryptocurrency as a valid and enforceable means of remuneration,” the posting said. “It underscores the importance of upholding contractual agreements as long as they are clear, agreed upon by both parties, and not in conflict with public policy or law.”
It concluded that the court’s enforcement of crypto payments as stipulated in contracts set a precedent that will likely encourage further integration of digital currencies in various sectors, not just in employment.
