UAE jobs: Fired by your employer? Know your rights

The UAE Labour Law provides workers the right to dispute unfair dismissals or demand compensation if proper procedures are not followed. The law strives for a fair and balanced approach to terminations, ensuring both employee rights and employer interests are considered.

Here are the legal rights for terminated employees in the UAE, as explained by experts.

UAE Labour Law: All you need to know about job termination

The UAE Labour Law contains key provisions to help terminated employees transition to new opportunities.

According to the Federal Decree Law No. 33 of 2021 Regarding the Regulation of Employment Relationships and its amendments, the employment contract can be terminated on the following cases:

1. The written agreement of both parties upon its termination;
2. Expiry of the term specified in the contract, unless it is extended or renewed as per the provisions hereof;
3. Based on the wish of either party, provided that the provisions hereof regarding termination of the employment contract and the notice period agreed upon in the contract are observed;
4. The employer’s death if the subject of the contract is related to its entity;
5. The worker’s death or full permanent inability to work, as proven by a certificate issued by the medical entity;
6. A final judgment issued against the worker by a freedom-restricting penalty for a period of not less than three months;
7. Closing the establishment permanently, in accordance with the legislation in force in the State;
8. The bankruptcy or insolvency of the employer, or any economic or exceptional reasons that prevent the continuation of the project, in accordance with the conditions, rules and procedures specified by the Implementing Regulation and the legislation in force in the State;
9. The worker’s failure to fulfil the conditions for renewing the work permit for any reason beyond the control of the employer.

When asked if employees have protection against unfair firing, Asma Siddiqui, Senior Associate, BSA Ahmad Bin Hezeem & Associates LLP explained that UAE Labour Law “does oblige the employers to have a valid reason for terminating an employee.”

“Also, it expressly prohibits an employer from firing an employee if the employee lodges a complaint with the Ministry of Human Resources and Emiratisation (MoHRE) or files a lawsuit against the employer. Such dismissal will be regarded as arbitrary dismissal by the employer, obliging the employer to pay a fair compensation to the employee,” she said.

Echoing the sentiment, Thenji Moyo, Partner and Head of Employment Law at Gateley, Dubai added that “where the dismissal is deemed unfair by the UAE Labour Courts, the courts may award compensation of up to three months of the employee’s remuneration, based on their last drawn salary. The compensation is determined on a wide range of factors which include, losses faced by the employee, the type of work and length of service with the employer.”

What are your rights if you are fired from a UAE job?

According to Moyo, an employee is entitled to a number of rights upon termination, which include the following:

1. Notice Pay – The employee is entitled to notice pay under Article 43 of the UAE Labour Law. Where the employer decides to forego the notice period, the employee will be entitled to compensation in lieu of notice.

However, she said, where the employment is terminated for cause/gross misconduct under Article 44 of the UAE Labour Law, the employee will not be entitled to any notice pay.

2. Unpaid leave during notice period – During the notice period the employee is entitled to take leave of one day a week without pay, to look for alternative job opportunities provided the employer is informed of the leave at least three days in advance.

3. Annual Leave – The employee is entitled to payment for any accrued but unused annual leave in proportion to the period worked. The employee should receive a lump sum payment calculated based on the employee’s basic salary.

According to Article 29 of the UAE Labour Law, upon termination the employee is entitled to wages for any unused annual leave accrued until the last day of employment. The pay will be calculated based on the employee’s basic salary. The employee is able to make a claim for any accrued annual leave or general labour claims within a year after termination.

4. End of Service Gratuity – Under Article 52 of the UAE Labour Law, an expat employee who has completed more than one year of continuous service with an employer is entitled to a severance pay at the end of their employment, not exceeding two years wages. The severance pay is calculated on the employee’s basic salary in the following manner:

• 21 working days wage for first five years of service.
• 30 working days wage for each subsequent year of service.

The employee is entitled to the end of service gratuity even where the employment is terminated for cause in accordance with Article 44 of the UAE Labour Law.

5. End of Service Certificate – Upon the employee’s request, the employer must provide a service letter to the employee, setting out:

• Employment commencement and expiration date;
• Total period of service;
• Employee’s position/role and nature of work;
• The last drawn wage of the employee; and
• The reason for termination.

6. Staff Accommodation – Under Article 16 of the UAE Labour Law, where the employee is residing in a company provided staff accommodation, the employee is entitled to reside in the accommodation for up to 30 days after the termination date. However, if the employer agrees, the employee can reside in the accommodation for longer provided he/she bear the cost of accommodation or any other agreement the parties reach.

7. Health Insurance – The employer should bear the cost of the employee’s health insurance coverage up to the end of the sponsorship grace period.

8. Contractual and Statutory Benefits – The employee must receive all their contractual and statutory benefits such as allowances (housing, transportation, school etc.), approved expenses incurred during employment, any contractual bonus or commission accrued to the termination date.

All entitlements owed to the employee should be paid within 14 days of the termination date pursuant to Article 53 of the UAE Labour Law.

What notice does an employer have to give before letting someone go?

According to BSA Legal’s Siddiqui, the notice period varies based on terms of the employment contract.

“By law, it is to range between a minimum of 30 days to maximum 90 days. In case the employee is being terminated during the probation period the employer is obliged to give 14 days’ notice only. Also, in exceptional and limited cases, specifically such as the employee committing assault, disclosing work secrets, forging documents, among others, no advance notice is required,” she said.

Siddiqui further explained that an employee can also file a complaint with the MoHRE, if they believe they were unfairly dismissed.

“The employee can present their case, and the labour authorities may investigate and mediate between the parties. If unresolved, the matter may proceed to court,” she said.

In addition, Gateley’s Moyo said Under Article 24 of the Cabinet Resolution No. 1 of 2022, where an employee is terminated due to disciplinary action, the employee can file a complaint with the employer’s management against the penalty without prejudice to any claim the employee may file with the UAE Labour Courts.

“To submit an appeal for disciplinary action, the employee would need to prepare a grievance to the employer setting out the penalty imposed i.e. termination of employment and his/her reasons on why the penalty should be overturned. The employer should then consider the grievance and communicate the outcome to the employee. The employee should not face any retaliation or victimisation for filing a grievance against the penalty,” she explained.

Do the rules change based on how long someone worked there?

According to Siddiqui, the entitlements such as end-of-service gratuity depends on the length of service.

“The quantum of compensation for an unfair dismissal is mainly decided upon after taking into consideration the length of service,” she said, adding that it is “vital” for employees to keep a record of their employment.

Keeping a record of their “employment contract and other relevant correspondences relating to their employment and termination such that they can seek any necessary advice and/or redress, as to their specific rights and situation,” she said.

Moyo also agrees and said that the end-of-service gratuity varies based on length of service, and begins to accrue after one year of employment and after five years of service the entitlement increases.

“The rules surrounding notice periods also vary based on employee’s service. Under Article 9 of the UAE Labour Law, where an employee is on their probation period and wants to terminate the employment, they are subject to a 14 day minimum notice period if the employee is leaving the UAE, or if they are staying in the UAE but transferring to a new employer a 30-day minimum notice period. After the probation period, the employee’s notice period requirements would be as agreed between the parties in the employment contract (.i.e. either 30,60, or 90 days),” she said.

Moyo concluded by saying the UAE law now strongly prohibits workplace discrimination and protects employees from being fired due to attributes like gender, religion or mental health conditions except with proper medical justification. Employers risk large fines if found to have terminated someone for discriminatory reasons.

“The Federal Decree Law No. 33 of 2021 (UAE Labour Law) brought in substantial legislative amendments after 40 years. We witnessed the introduction of new concepts, such as protection from discrimination on the basis of protected characteristics which include race, age, nationality, gender, colour, religion, national origin, ethnic origin or disability. It is critical for employers to ensure that employee dismissals are not tainted with discrimination, as under Article 63 of the UAE Labour Law they risk being subjected to fines of up to AED 1,000,000.

“Further, in May 2024 the UAE introduced the Federal Law No.10/2023 on Mental Health which protects against termination of employees with mental disability. Employers may not terminate an employee based on their mental condition except when based on a report from a specialised medical committee,” she said.