Expanding into the Middle East is on the radar of many ambitious foreign companies, and Dubai—with its booming economy, world-class infrastructure, and status as a global business hub—is the most attractive entry point. But the process of establishing a legal entity in the UAE can be complicated, expensive, and time-consuming.
So what if your business wants to hire employees in Dubai without the hassle of creating a local company? The good news is: it’s entirely possible. Thanks to solutions like Employer of Record (EOR) and Professional Employer Organization (PEO) services, foreign companies can legally hire in Dubai without setting up their own entity.
In this blog, we’ll explore how this works, why it’s a smart choice, what challenges to avoid, and who the best providers are.
Why Companies Want to Hire in Dubai Without Entity Setup
Setting up a business in Dubai involves trade licenses, legal incorporation, office space requirements, visa quotas, and compliance with mainland or free zone laws. This process can take weeks or even months, and costs can run into tens of thousands of dollars.
For many foreign companies, this doesn’t make sense—at least not initially. They may want to:
- Test the UAE market before committing long-term.
- Hire remote workers or contractors based in Dubai.
- Deploy a small sales or operations team to explore business opportunities.
- Add specialized local talent to a global workforce.
- Scale quickly without waiting for entity approvals.
That’s where hiring without a company setup becomes the perfect solution.
The Legal Way to Hire in Dubai Without a Company
You cannot legally hire an employee in Dubai directly under your foreign company unless you have a registered entity. Employment in Dubai requires a local sponsor for visas, work permits, payroll compliance, and end-of-service obligations.
But there is a compliant alternative:
Employer of Record (EOR) Model
An Employer of Record is a service provider that acts as the legal employer of your staff in Dubai. The EOR hires employees on your behalf, manages their contracts, sponsors visas, processes payroll, and ensures compliance with UAE labor laws.
Meanwhile, you—the foreign company—retain day-to-day control of the employee’s work, role, and performance.
This model allows you to:
- Onboard staff in days instead of months.
- Avoid setting up an entity.
- Ensure compliance with labor and immigration laws.
- Focus on business growth while the EOR handles admin.
Benefits of Hiring Through an EOR in Dubai
Here’s why more global businesses are using EORs instead of immediately setting up a company:
1. Faster Market Entry
You can start operations in Dubai almost instantly, instead of waiting months for licensing and registrations.
2. Lower Costs
Avoid trade license fees, office lease expenses, local sponsorship fees, and legal incorporation costs. You simply pay a monthly fee per employee.
3. Legal Compliance
The EOR ensures employment contracts, payroll, visas, and benefits meet UAE regulations—reducing risks of fines or disputes.
4. Scalability
Need one employee today and ten tomorrow? The EOR model allows you to scale up or down easily.
5. No Permanent Establishment Risk
Hiring through an EOR may help reduce risks of creating a taxable permanent establishment in the UAE.
6. Full HR Support
The EOR handles HR admin such as contracts, onboarding, medical insurance, end-of-service gratuity, and visa renewals.
How the Process Works
Here’s a step-by-step look at how hiring employees in Dubai without a company setup works with an EOR:
- Define Your Needs – Decide on the roles, salaries, benefits, and job descriptions.
- Choose an EOR Partner – Select a provider with expertise in UAE labor law and immigration processes.
- Draft Employment Contracts – The EOR prepares bilingual (Arabic/English) contracts compliant with UAE regulations.
- Visa Sponsorship & Work Permits – The EOR sponsors and secures visas, Emirates IDs, and work permits.
- Onboarding & Payroll Setup – Employees are enrolled in payroll under the Wage Protection System (WPS), ensuring timely salary payments.
- Ongoing HR & Compliance Management – The EOR handles insurance, leave entitlements, and end-of-service benefits.
- Day-to-Day Management by You – While legally employed by the EOR, employees report to and work for your company.
Example Use Cases
- Tech Startups: A European SaaS company wants to hire two Dubai-based sales reps to expand into the Middle East but isn’t ready to open an office.
- Consulting Firms: A U.S. consultancy wins a project in Dubai and needs to hire project managers locally for 12 months.
- Remote Teams: A Canadian e-commerce brand wants to tap into Dubai’s pool of digital marketers without setting up a branch.
- Multinationals: A Fortune 500 company wants to pilot operations in the UAE with minimal upfront costs before a full entity launch.
Employer of Record vs. Setting Up a Company in Dubai
| Criteria | Hiring via EOR | Setting Up Entity |
|---|---|---|
| Speed | Onboard in days | Weeks to months |
| Cost | Pay per employee fee | High setup & licensing fees |
| HR/Admin | Outsourced | Handled internally |
| Compliance | Guaranteed by EOR | Full responsibility |
| Flexibility | Easy to scale or exit | Harder to shut down |
| Brand Presence | Limited (no entity) | Full local presence |
Key Legal Considerations
When hiring employees in Dubai through an EOR, several regulations apply:
- Wage Protection System (WPS) – Salaries must be processed through the government-monitored WPS.
- End-of-Service Benefits – Employees are entitled to gratuity based on tenure.
- Health Insurance – Mandatory in most Emirates, must meet minimum standards.
- Employment Contracts – Must follow UAE labor law, bilingual, and registered with relevant authorities.
- Emiratisation – Companies of certain sizes must meet Emirati hiring quotas; an EOR ensures compliance.
Best EOR Providers in Dubai
Here are some of the most reputable EOR companies helping foreign firms hire in Dubai without setup:
- Remote – Global EOR with UAE presence, offering fast onboarding and payroll compliance.
- Deel – Known for user-friendly software and quick visa processing.
- Oyster – Specializes in remote-first hiring solutions.
- Globalization Partners – Strong compliance reputation with deep legal expertise.
- Velocity Global – Scalable solutions for mid-to-large enterprises.
- Triple Trillium Services – A UAE-based provider with strong local knowledge.
- ManpowerGroup Middle East – Global brand with on-the-ground support in Dubai.
Challenges and Limitations
While hiring through an EOR is highly beneficial, it does come with a few limitations:
- Higher Per-Employee Costs long term compared to your own entity.
- Less Brand Visibility since contracts are under the EOR’s name.
- Contractual Limitations on certain industries that require licenses (e.g., banking, healthcare).
- Dependence on EOR Reliability – poor service can affect your employees’ experience.
Best Practices for Foreign Companies
- Choose an Experienced EOR – Ensure they have strong local expertise and a good compliance record.
- Get Transparent Pricing – Understand all fees including visa, insurance, and exit costs.
- Plan for the Future – Decide whether this is a short-term entry strategy or a long-term solution.
- Prioritize Employee Experience – Even if the EOR is the legal employer, treat your staff as full team members.
- Stay Updated on Law Changes – UAE labor law evolves; ensure your EOR keeps you informed.
When to Transition from EOR to Your Own Entity
At some point, you may outgrow the EOR model. Signs it’s time to consider setting up a company:
- Hiring more than 10–15 employees.
- Needing a permanent local office or trade license.
- Planning to bid for government contracts (which often require a local entity).
- Wanting more control over employee benefits and branding.
Many companies start with an EOR, then move to full entity setup once the business matures.
Conclusion
Hiring employees in Dubai without setting up a company is not only possible—it’s one of the smartest strategies for foreign businesses entering the UAE market. Through the Employer of Record model, you can quickly and legally build a team, access top talent, and test the market without the costs, delays, and risks of entity setup.
Whether you’re a startup testing waters, a consulting firm managing a project, or a multinational exploring the Middle East, EOR services give you the flexibility, speed, and compliance you need.
Dubai’s talent pool is waiting. With the right EOR partner, you can hire confidently and scale strategically—without being slowed down by bureaucracy.