South Asians, who make up a large proportion of the UAE’s foreign workforce, will be the main beneficiaries.
But the decision, which enters force in December, will only apply to companies that employ more than 50 workers, the human resources and Emiratisation ministry said on Monday.
The UAE and other oil-rich Gulf states are often criticised by human rights groups for their treatment of expatriate labourers.
“Experts spent several months studying the living conditions of those workers, who have been listed in the ministry’s classifications system as low-skilled labourers,” Human Resources Minister Saqr Ghobash.
The ministry will carry out regular inspections of the housing that companies provide to their workers to ensure that health and safety standards are met, Ghobash said.
Legal action will be taken against companies that violate the regulations, he said.
Last year, the UAE announced labour reforms aimed at curbing abuses and protecting the rights of millions of foreign workers, including allowing them to terminate their contract and change employer.
Emiratis, who account for barely 10 percent of the UAE’s population of nine million, are a small proportion of the workforce compared to Asians.
Kuwait last week set a minimum wage for its hundreds of thousands of mostly Asian domestic workers and granted them other rights.