Disciplinary and Termination Procedures Under the UAE Labor Law
Introduction
In the constantly evolving landscape of employment law, the UAE has made significant strides with the introduction of Federal-Law No. (33) of 2021, alongside Cabinet Resolution No. (1) of 2022. This legislation marks a pivotal development in the regulatory framework governing employer-employee relationships, specifically focusing on disciplinary measures within the workplace. Here, we delve into the specifics of these regulations, exploring the types of disciplinary actions authorized under the law, the conditions under which they can be applied, and the protections afforded to employees throughout the process.
Understanding Disciplinary Measures and Their Implementation
Federal Decree-Law No. (33) of 2021, has empowered employers to impose appropriate disciplinary measures on employees who violate proper conduct at work or fail to comply with the provisions of the Decree-Law and the associated Cabinet Resolution No. (1) of 2022. This authority is contingent on ensuring a proportionate relationship between the employee's misconduct and the resulting disciplinary action. The employee must have committed the violation for which the disciplinary penalty is imposed during the specific work hours and at the designated workplace where the employee carries out their duties.
Provisions of Article (39) of Federal Law No. (33) of 2021 outlines the disciplinary penalties that can be imposed on employees. These penalties are designed to maintain workplace discipline and ensure that employees adhere to the organization's rules and regulations.
The law authorizes the employer to issue a written notice or warning to the employee as a first step in addressing any misconduct or violation of the company's policies. These warnings serve as a formal notification to the employee, alerting them to the issue at hand and providing them with an opportunity to rectify their behavior.
In more severe cases, the employer may deduct a portion of the employee's wages, not exceeding five days' wages per month. This financial penalty is intended to emphasize the gravity of the employee's actions and encourage them to improve their conduct. The law also permits the employer to suspend the employee from work for a period of up to 14 days, during which the employee will not receive their wages.
For establishments with a periodic bonus system, the employer may choose to deprive the employee of their bonus for a period not exceeding one year. This penalty is particularly impactful for employees who rely on these bonuses as a significant portion of their overall compensation.
In cases where the organization has a promotion system in place, the employer may also choose to withhold the employee's promotion for a period not exceeding two years. This penalty can have a significant impact on the employee's career advancement and professional development within the organization.
The most severe penalty outlined in the law is the dismissal of the employee from service. However, even in such cases, the law safeguards the employee's right to receive their end-of-service gratuity, ensuring that they are not entirely deprived of their rightful entitlements upon termination of employment.
The comprehensive nature of these disciplinary measures reflects the government's commitment to maintaining a well-regulated and harmonious workplace environment, where employees are held accountable for their actions and employers have the necessary tools to address any breaches of conduct.
Suspension and Investigation Processes
The employer has the authority to temporarily suspend an employee from their duties for a maximum of 30 days. This suspension period allows the employer to conduct a disciplinary investigation against the worker to determine any potential wrongdoing or misconduct. During this suspension, the employee's wage is reduced by half, meaning they will only receive 50% of their regular salary.
The rationale behind this measure is to provide the employer with the necessary time and resources to thoroughly investigate the matter at hand, without the employee continuing their regular work duties. This suspension period serves as a temporary measure, allowing the employer to gather evidence, interview relevant parties, and assess the situation objectively before reaching a final decision.
If the investigation concludes with a finding that the employee has not violated any company policies or regulations, or if the employee is only penalized with a warning, the employer is obligated to pay the employee the amount of wages that were withheld during the suspension period. This ensures that the employee is not unduly punished if the investigation exonerates them or results in a minor disciplinary action.
This provision aims to strike a balance between the employer's need to maintain discipline and the employee's right to fair treatment. By allowing for a temporary suspension with reduced pay, the employer can address potential misconduct while also ensuring that the employee's rights are protected if the investigation finds no wrongdoing or if the penalty is deemed appropriate. The employer has the authority to temporarily suspend an employee from their work duties if the employee is accused of committing a serious crime, such as assault against a person or property, or crimes against honor or trust. This temporary suspension can remain in effect until a final decision is issued by the competent judicial authority overseeing the case.
During this suspension period, the employee's wages will also be withheld. This measure is put in place to ensure the integrity of the investigative process and to protect the employer's interests while the legal proceedings unfold.
However, there are essential provisions in place to protect the rights of the employee. If a decision is ultimately issued stating that the employee will not be brought to trial, or if the employee is acquitted due to a lack of evidence for a felony-level offense, or if the investigation ends in dismissal due to insufficient proof of wrongdoing, then the employee must be reinstated to their position.
In such cases, the employer must pay the employee all the wages that were suspended during the temporary work stoppage. This ensures that the employee is not unfairly penalized if the accusations against them are ultimately found to be unsubstantiated by the judicial system.
It is worth noting that temporarily suspending employees from their duties is viewed as a preventive action, not a punitive measure. The Emirati legislator empowers employers to suspend employees who have been charged with offenses involving violence, property damage, or breaches of integrity. There is no fixed duration for this suspension, which will last until the relevant judicial authorities have reached a final verdict.
Termination Without Notice
Employers in the UAE are empowered to terminate an employee's contract without prior notice, but only after a formal written investigation involving the employee. The dismissal decision must be documented and justified. Termination is viewed as the harshest disciplinary measure against an employee.
Article 44 of the Decree Law specifies the exclusive grounds for dismissal without notice, and the Emirati legislator has rightly restricted this, preventing employers from arbitrarily imposing penalties not stipulated by law, which would otherwise be invalid. Furthermore, no disciplinary action can be taken unless the employee has committed a breach that undermines the proper operation of the business and damages the employer's interests.
The provisions of Article (24) of Cabinet Resolution No. (1) of 2022 regarding the executive regulations of Federal Decree Law No. (33) of 2021, on the regulation of labor relations, have regulated the controls for imposing disciplinary penalties on employees, as well as the method and mechanism for grievance against them.
Discipline penalties must be imposed on the employee, taking into account the imposition of the appropriate penalty according to the gravity and seriousness of the violation committed by them, in accordance with specific controls and standards. The employer is required to make a list of penalties in which each of the aforementioned disciplinary penalties is explained.
The employer must notify the employee in writing of the allegations against them, give them an opportunity to respond, conduct an investigation, and document their findings in the employee's file before imposing any disciplinary measures. The employee must also be informed in writing about the specific penalties being imposed, including the type, amount, and reasons for the disciplinary action. Additionally, the employee must be made aware of the consequences they will face if the undesirable behavior continues.
Legal Safeguards and Appeal Mechanisms
Employees have the right to challenge any disciplinary action taken against them by appealing to their management. Submitting a grievance will not harm the employee, and the employer must inform the employee of the outcome in each case. This is without prejudice to the employee's right to file a labor complaint with the Ministry of Human Resources and Emiratization.
The UAE legislator has provided complete legal protection to employees by invalidating any disciplinary procedures that are not in line with the law. This aims to ensure the efficiency of the labor market by attracting and retaining the best talent. Simultaneously, it provides a stimulating and attractive work environment for employers by regulating the relationship between all parties in a sound legal manner.
References
1. Federal Decree Law No. (33) of 2021 regulating labor relations.
2. Cabinet Resolution No. (1) of 2022 regarding the executive regulations of Federal Decree Law No. (33) of 2021 on regulating labor relations.