Latest news with #UAEEmploymentLaw
Hi Dubai
14-04-2025
- Business
- Hi Dubai
Severance Pay and Golden Handshakes in the UAE: What You Need to Know
Question: I am planning to move to the UAE this summer and have been exploring job opportunities. However, none of my potential employers have been willing to offer a severance package. I'd like to understand if there are any laws or regulations about this. Is it possible to include a "golden handshake" clause in my job contract? And if I do, will it be legally binding? Answer: If you're considering an employment offer from a company based in the UAE mainland, you'll be governed by the UAE's Employment Law, as well as the Civil Transactions Law. These legal frameworks protect employee rights, including those related to severance pay. According to Article 51(2) of the Federal Decree Law No. 33 of 2021, any employee who has completed at least one year of continuous service is entitled to severance pay upon the end of their employment. The severance pay is based on the employee's basic salary and is calculated as follows: 21 days of salary for each year of service during the first five years. for each year of service during the first five years. 30 days of salary for each year of service after the first five years. Additionally, Article 8 of the UAE Employment Law and Article 10(1) of Cabinet Resolution No. 1 of 2022 specify the regular terms and conditions that must be included in an employment contract. However, the standard contract template provided by the Ministry of Human Resources & Emiratisation (MoHRE) does not typically include a clause about severance pay. Despite this, you are still entitled to severance pay if you have completed at least one year of service with your employer, even if it is not explicitly mentioned in your contract. The UAE Employment Law guarantees employees this entitlement, regardless of whether the contract addresses it directly. Can a "Golden Handshake" Be Included in Your Contract? While the UAE's Employment Law lays out the minimum rights of employees, it does not restrict employers from offering more favorable terms. As per Article 65(1) of the UAE Employment Law, employers can provide benefits that go beyond the statutory minimum, including the possibility of a "golden handshake" clause. A "golden handshake" refers to a negotiated severance package that offers more generous compensation than the standard severance pay. If you wish to include this clause in your contract, you can discuss it with your prospective employer. If both parties agree, it can be incorporated into the contract and will be legally binding, as long as it complies with the UAE's legal framework on employment contracts, which mandates that contracts be executed in good faith and in line with the law. In summary, while the UAE Employment Law ensures that you are entitled to severance pay, it also allows for the inclusion of more favorable terms such as a "golden handshake." You should discuss this possibility with your employer, who may agree to include it in your employment contract. If you have any concerns, it's always advisable to consult with a legal professional familiar with UAE employment laws to ensure your rights are fully protected. Applicable Laws: Federal Decree Law No. 33 of 2021 Regarding the Regulation of Employment Relationships Cabinet Resolution No. 1 of 2022 on the Implementation of Federal Decree-Law No. 33 of 2021 Regarding the Regulation of Employment Relations Federal Law No. (5) of 1985 On the Civil Transactions Law of the United Arab Emirates News Source: Khaleej Times
Khaleej Times
13-04-2025
- Business
- Khaleej Times
UAE: Can employees ask for a severance package in their job contract?
Question: I am planning to move to the UAE this summer and have been exploring job opportunities. However, none of my potential employers I've spoken to were willing to offer a severance package. I'd like to understand if there are any laws or regulations about this. Is it possible to include a "golden handshake" clause in my job contract? And if I do, will it be legally binding? Answer: It is assumed that you are considering an employment offer from a company based in the UAE mainland. In that case, the UAE Employment Law, along with related cabinet resolutions and the Civil Transactions Law, would apply to your situation. In the UAE, an employee who has completed at least one year of continuous service is entitled to severance pay at the end of his or her service with an employer. The severance pay of an employee is calculated on his or her basic salary. This is in accordance with the Article 51(2) of the Federal Decree Law no. 33 of 2021 Regarding the Regulation of Employment Relationships and its amendments ('UAE Employment Law'), which states: 'The full-time foreign employee, who completed a year or more in continuous service, shall be entitled to end-of-service benefits at the end of his service, calculated according to the basic salary as per the following: a. A salary of (21) twenty-one days for each year of the first five years of service; b. A salary of (30) thirty days for each year exceeding such period.' Further, the Article 8 of the UAE Employment Law read with Article 10 (1) of the Cabinet Resolution No. 1 of 2022 on the Implementation of Federal Decree-Law No. 33 of 2021 Regarding the Regulation of Employment Relations (the 'Cabinet Resolution No. 1 of 2022'), states the regular terms and conditions which needs to be included in an employment contract of an employee. In the UAE, the parties to any contract are legally bound to carry out their respective obligations as stated in the contract, and to do so honestly, fairly, and in good faith. This is in accordance with accordance with Article 246 (1) of the Federal Law No. (5) of 1985 On the Civil Transactions Law of the United Arab Emirates, which states: '1. The contract shall be implemented, according to the provisions contained therein and, in a manner, consistent with the requirements of good faith.' Generally, in the UAE, the Ministry of Human Resources & Emiritisation (Mohre) template of the employment offer letter and contract does not contain clause related to severance pay. However, you may request your prospective employer to include the same. If your prospective employer does not agree to include details about severance pay in your employment offer letter, or if the offer letter and employment contract do not mention it, you will still be entitled to receive severance pay when your employment ends, as long as you have completed at least one year of service with the company. As an employee, you are entitled to all the benefits outlined in the UAE Employment Law and its related cabinet resolutions, including severance pay as specified in Article 51(2) of the UAE Employment Law. Additionally, while the UAE Employment Law ensures the protection of employee rights, it does not restrict employers from offering more favourable terms. This is in line with Article 65 (1) of the Employment Law, which states: 'Rights laid down in this decree-law shall consist the minimum employees' rights. The provisions of this Decree-Law shall not prejudice any of the rights prescribed for employees under any other legislation, agreement, declaration, regulation or employment contract, giving rise to rights that are more beneficial than those laid down in the provisions of this Decree-Law.' If you're considering including a 'golden handshake' clause in your employment contract, you can discuss this with your prospective employer and mutually agree to add it to the contract. Applicable laws: 1. Federal Decree Law no. 33 of 2021 Regarding the Regulation of Employment Relationships and its amendments 2. Cabinet Resolution No. 1 of 2022 on the Implementation of Federal Decree-Law No. 33 of 2021 Regarding the Regulation of Employment Relations 3. Federal Law No. (5) of 1985 On the Civil Transactions Law of the United Arab Emirates
Hi Dubai
24-03-2025
- Business
- Hi Dubai
Can Your HR Refuse to Approve Annual Leave During Eid? Here's What You Need to Know
Question: I work in a managerial role in a mainland Dubai company. With the Eid break coming up, I wish to combine my annual leave with the holidays to have an extended vacation. Can my HR refuse my request citing my managerial responsibilities? Answer: If you are employed in a company with more than 50 employees, the answer largely depends on your employer's policies and the operational needs of the business. Under UAE labor law, it is within an employer's discretion to set annual leave dates, taking into account the company's operational requirements, or by mutual agreement with the employee. What does the law say? As per Article 29 (4) of Federal Decree Law No. (33) of 2021 on the Regulation of Employment Relations, an employer can decide the dates of annual leave based on work needs, in consultation with the employee. Furthermore, an employer is required to inform the employee of their leave dates at least one month prior to the start of the leave. Additionally, Article 13(3) of the UAE Employment Law mandates that companies with more than 50 employees must have internal regulations, including guidelines on leave policies. These regulations must be in line with the law but can offer more favorable conditions for employees. What about combining leave with public holidays? If your company's internal policies or HR handbook allow the combination of annual leave with public holidays, you are entitled to take advantage of that. According to Article 65(4) of the UAE Employment Law, an employer can create bylaws that provide more benefits to the employee than those stipulated in the law. In case of a conflict between internal policies and the law, the more favorable conditions for the employee will apply. Can HR refuse your leave request? While HR may refuse your request to combine annual leave with the Eid break, especially if your managerial role demands your presence during the holidays, it is crucial to discuss the matter. You may be able to reach a mutual agreement with your HR team to accommodate your request, considering both your personal and the company's needs. Ultimately, while your HR can refuse the request based on company policy or operational needs, the law ensures that employees' rights are protected, offering room for discussion and flexibility. News Source: Khaleej Times
Khaleej Times
23-03-2025
- Business
- Khaleej Times
Longer Eid break: Can UAE employers deny requests to combine holiday with annual leave?
Question: I work in a managerial role in a mainland Dubai company. With the Eid break happening in soon, I wished to combine my annual leave with the holidays to have an extended vacation. Can my HR refuse my request citing my managerial responsibilities? Answer: It is assumed that you are employed in a company which employs more than 50 people. In the UAE, it is at the discretion of an employer to determine the annual leave dates of its employees based on the company's operational requirements, or mutually in agreement with an employee. An employer must inform an employee of his/her annual leave dates (start date and end date) at least one month in advance before the commencement of the said annual leave. This is in accordance with Article 29 (4) of Federal Decree Law No. (33) of 2021 on the Regulation of Employment Relations which states: 'The employee shall use his leave in the year of entitlement. The employer may fix the dates of leave according to the work requirements and in agreement with the employee, or rotate leaves among employees for the smooth progress of work, and shall notify the employee of the date of his leave at least (1) one month before the same." Furthermore, an employer should have its own internal employees' handbook or HR policy related to rules and regulations of employment if it employs more than 50 employees. This is under Article 13(3) of the UAE Employment Law, which states: 'The employer shall put in place internal work regulations, including work instructions, sanctions, promotions, benefits and other bylaws and internal regulations pursuant to the controls set by the executive regulations of this decree law.' However, if your employer's human resources (HR) policy or internal rules and regulations mention that annual leave and public holidays can be combined, then you are entitled to the same. This is in accordance with Article 65(4) of the UAE Employment Law, which states: 'The Employer may establish and put in place organisation bylaws and programmes in the Establishment that would be more beneficial to the employee than those prescribed in this Decree-Law and its Executive Regulations. In the event of a conflict between such programmes and bylaws and the provisions of this Decree-Law, conditions that are more beneficial to the employee shall apply.' Based on the aforementioned provisions of law, HR may refuse your request to combine your annual leave with the Eid holidays citing your managerial responsibilities if the work requires you to attend the office or in accordance with the company's internal policies. However, you may discuss the matter with your HR/employer to mutually agree on combining your annual leave with upcoming public holidays on account of Eid.
Hi Dubai
17-03-2025
- Business
- Hi Dubai
UAE: Can You Decline a Job Offer After Accepting It via Email?
Question: I received a job offer from a Dubai-based company and accepted it via email but did not sign any contract. Now, I have a better offer from another company. Will I face any legal trouble if I decline the first offer? Answer: In the UAE, job offers and employment contracts are regulated by the Ministry of Human Resources and Emiratisation (MoHRE) under Ministerial Decree No. 46 of 2022 and Federal Decree-Law No. 33 of 2021. A job offer issued by an employer must align with the standard employment contract, as per Article 2(1) of Ministerial Decree No. 46 of 2022. However, an offer letter, unless signed and converted into an employment contract, is generally considered an informal agreement and may not be legally binding. According to Article 8(1) of Federal Decree-Law No. 33 of 2021, a formal employment contract must be signed by both the employer and employee, with each party receiving a copy. Since you have not signed any contract, you are not legally bound to join the company. Furthermore, Article 14(1) of the UAE Employment Law explicitly states that an employer cannot force an individual to work against their will. This means the company cannot compel you to accept the job. However, acceptance via email correspondence might be considered binding under other applicable UAE laws, depending on specific circumstances. To ensure clarity, consulting a legal expert is advisable before making a final decision. News Source: Khaleej Times
