Employee and employer rights and duties are laid out in the UAE labour law under Federal Decree Law No. 33 of 2021 on Regulation of Labour Relations (“Law”). The Law lays down clear rules regarding employee rights in case of unlawful termination, notice period and various end of employment benefits that are applicable in such scenarios. In this article, we discuss the various employee entitlements available to employees in case of both lawful and unlawful termination of employment.
Payment of pending salary
As per Article 8 of the Law, the employment contract stipulates the remuneration or the salary that is to be paid to the employee. The UAE law also requires the employer to provide housing or pay an amount towards housing rent, along with the salary. Salary of an employee may be increased during the course of the employment. The salary must be paid until the termination of the employment contract. If the employer has failed to pay any salary or part of a salary, during the course of the employment, this amount must be paid in full upon the termination of the end of the employment.
Payment of overtime salaries
Article 19 states that although the employer is allowed to employ a worker for working overtime in addition to his normal working hours, the worker must receive remuneration for the same, which must be equal to the basic salary – plus an increase of a minimum of 25% over that salary. If the overtime hours were between 10 pm and 4 am, or on a rest day, the remuneration must be the Basic Salary – plus an increase of not less than 50% over that salary. Any outstanding overtime payment must be paid to the worker upon the termination of the employment.
Unused Leaves
Article 29 of the Law entitles a worker an annual leave with full pay of not less than 30 days for each year of his extended service, or 2 days for each month if his service period is between six months and one year. If this leave has not been used, the employer must reimburse the employee for a sum that is proportional to the unused leaves.
End of Service Gratuity
As per Article 51 of the Law, a foreign worker in the UAE who has completed one year or more in continuous service, is entitled to an end-of-service gratuity upon the end of his service, calculated according to the last basic salary, as follows:
- Remuneration of 21 days for every year of service of the first five years.
- Remuneration of 30 days for each year after the first five years.
- The days of absence without pay will not be considered.
The complete end-of-service gratuity must not exceed two years’ salary, and the employer may deduct from the gratuity any amounts due legally or by judicial ruling, in accordance with the conditions and procedures specified by law. According to article 39(g), gratuity is payable even if an employee is being dismissed from service as part of a disciplinary penalty.
Compensation for work injuries or occupational diseases
As per Article 37 of the Law, if an employee has suffered a work injury, the employer must bear the expenses of the Worker’s treatment. The employer must thus ensure to clear all payments in this regard, under such circumstances.
Compensation for lack of notice
In accordance with Article 9(5), if an employee is terminated from a company without due notice as required by law, or as per the employment contract, the employer is liable to compensate the employee with a compensation equal to the employee’s remuneration for the length of the Notice Period or the remaining period of the Notice Period.
Illegal termination of employment
Illegal termination, as per Article 47 of the Law refers to termination of employment due to the employee filing a serious complaint with the Ministry of Human Resources and Emiritisation (MOHRE) or filing a lawsuit against the employer that has been proven to be valid. In such cases, the employer will be ordered to compensate the employee according to the type of Work, the amount of damage sustained by the Worker and the length of his service, and this compensation will not exceed the sum of three months’ salary. The employer will also be liable to pay gratuity and any amount in lieu of notice.
Time limit for payment Worker’s Entitlements
As per Article 53 of the Law, upon termination of the employment contract, the employer must pay all the entitlements due to the employee, within 14 days from the date of the contract termination.
Non-Monetary rights of an employee
Apart from monetary entitlements, the law under Article 13(11) of the Law, states that upon the employee’s request, the employer must provide the latter with an experience certificate free of charge, which contains the date of joining work, the date of its expiry, the total period of employment, the job title or type of Work that he was performing, the last salary that he received, and the reason for termination of the employment contract. The certificate must not include anything that might harm the worker’s reputation or reduce his job opportunities.
If the employee was hired from another country, the employer must bear the expenses to return the employee to the hiring country, unless the employee has joined another company, or if the termination was initiated by the employee himself.
According to Article 43(5), if the employment is terminated by the employer, the worker has the right to be absent during the Notice Period for one unpaid Working Day per week, so as to be able to look for another job.
Conclusion
The UAE government ensures that an employer cannot terminate a contract illegally, and imposes certain responsibilities on the employer, at the time of the termination of a contract, regardless of whether the contract was terminated by the employer or the employee. This not only protects the rights of the employee, but also lays down regulations to support the employee to find better opportunities.