Three things you need to know about UAE employment law

Author: Kirsty Tuxford | Date: 29 Jun 2016


Legal expert discusses impact of a new decree on work permits, employment visa confusion and end-of-service gratuity

Shadha ZawawiEmployment law in the UAE is frequently updated, making it challenging to keep on top of new regulations. Shadha Zawawi, a senior associate at Mahmood Hussain Advocates and Legal Consultancy, spoke to People Management about some commonly misunderstood, and recently revised, employment laws.
A new decree means that the rules around the automatic six-month employment ban, if leaving a job early, are no longer as strict
It is now easier for workers to apply for a new work permit at the end of their employment, thanks to a new decree. Previously, an automatic ban of six months applied if the employment was terminated before the completion of two years. This ban could be lifted on the basis of certain qualifications and if the next job fulfilled the required salary for the non-imposition of the ban.
 
According to the new decree, workers who are under an unlimited contract can now apply for a new work permit if both parties mutually terminate the contract, or if either party terminates the contract by giving the required notice, provided the worker has completed at least six months of employment. The new permit can be also applied for if the contract is terminated by the employer for reasons not attributable to the worker, on the condition that the worker has been in the job for at least six months.
 
The rules are similar for those on a limited contract, where the contract is terminated mutually or due to reasons not attributable to the worker, however, additionally, a new permit can be applied for when the fixed term has ended and not been renewed. Also, if the contract is terminated during the renewal period (provided that the party has given the required notice), the parties observe the notice period and required compensation is paid.
 
It’s important to note that the requirement to work six month’s service is not applicable for workers of skill levels one, two, or three – which includes individuals who hold a bachelor’s degree or higher education diploma, or have a high school or higher secondary qualification.
 
The employment ban is not applicable if the employer has violated its obligations; if the organisation ceases to operate; or if a labour complaint is filed against the employer and the case goes to court.
 
If your employment visa shows a different job title from the job you actually do, it could be because your employer has to select a title in the list provided by the ministry of labour
However, the employment contract should specify the occupation that is as close to the work performed as possible. The employee is advised to insist that the contract reflects his or her actual title. New employment rules mean that the employer must obtain a standard contract from the ministry of labour which details the exact terms of the employment offer. Therefore, the employers must ensure that the designation in the contract is the same as in the offer letter.
 
The end-of-service gratuity is capped at the equivalent of two years’ wages
An employee who has completed more than one year of continuous service is entitled to the end-of-service gratuity when they reach the end of their employment. However, a worker on a limited contract will not be entitled to receive the gratuity if they have resigned before the fixed term, unless the worker has served more than five years of continuous service. The end-of-service gratuity is calculated on basic salary and is determined differently depending on the type of contract and the years of service. The gratuity amount, however, in all cases must not exceed two years of wages.