If it's illegal to confiscate passports in Dubai why is it so widespread and commonplace? Is it like smoking MJ in most states - it's "illegal" but unless cops want a reason to arrest you they'll just ignore you and keep on driving?
To get a low-skilled work visa in Dubai you have to sit through an hour long lecture explaining these rights, including what to do if your employer takes your passport.
You are advised to not give your passport to your employer except to have your visa stamped, and then immediately demand it back.
This country is modernizing very rapidly, things that were true 5 years ago are often not true anymore.