‘I was made redundant via WhatsApp. What payout am I due?’ Q
I work for a free zone company in Dubai. Last month, my boss sent me a WhatsApp message saying my last day will be December 26 as they are closing the company. I don’t have a hard copy of the termination letter yet. A few weeks earlier, my colleague was given a termination letter. She finished work earlier this month. We started working for them in April. What can we get out of this termination as we have been employed for less than a year? As per my colleague’s termination letter, she will get her salary and a one-way ticket to her home country. Are we eligible for our leave salary? NM, Dubai A
NM is on an unlimited contract of employment. If someone is made redundant by an employer, I would at least expect a personal conversation followed up by an official letter. Sending a WhatsApp message seems unprofessional and may not be strictly legal as Article 117 of UAE Labour Law states: “The employer and the worker may terminate the employment contract with undetermined term for valid grounds at any time subsequent to the conclusion of the contract, and such after notifying the other party thereof in writing at least thirty days prior to the termination thereof.”
In terms of what is payable, Article 118 of the Labour Law states: “The worker shall be entitled to his complete wage for such period on the basis of the last paid wage. He must perform his job during said period should the employer so require.” This means the salary must be paid in full until the final day of service and annual leave continues to accrue during this period, so any days of leave not taken should also be given as a payment in lieu with the final salary payment.
No end of service gratuity is due as the period of service is less than a full year.
No additional payment is due if redundancy is due to the company closing.
The company is responsible for the cost of a flight but only if the employee is leaving the UAE. This is covered in Article 131 which clarifies: “The employer shall, upon the termination of the contract, bear the expenses of repatriation of the worker to the location from which he is hired, or to any other location agreed upon between the parties. Should the worker, upon the termination of the contract, be employed by another employer, the latter shall be liable for the repatriation expenses of the worker upon the end of his service.”
If a person is an absconder from the UAE with outstanding credit card debts can the person’s child still apply for a job in the UAE? I left in 2011 with unpaid debts but my son now wants to move there without the risk of being held responsible for my unpaid debt. GP, India
Under UAE law only the person whose name the debt is in – the person who borrowed the money – has liability for it. The only time someone else would be liable is if they are a joint account holder or if they have signed paperwork as a guarantor for the debt. While GP should repay the money he borrowed, his son will have no legal responsibility.
My work visa was renewed on May 1 and is valid until May 1, 2020. If I want to resign on personal medical grounds before completing a year on the current visa, will I face a penalty? I am an engineer and my salary qualifies for family status. SN, Abu Dhabi
As SN is on a fixed-term contract, he will be penalised for breaking the contract.
This is as set out in Article 116 of UAE Labour Law, which states: “The worker shall be bound to compensate the employer for the loss incurred thereto by reason of the rescission of the contract, provided that the amount of compensation does not exceed the wage of half a month for the period of three months, or for the remaining period of the contract, whichever is shorter, unless otherwise stipulated in the contract.”
This is a sum equivalent to 45 days of full salary and he should also give notice in line with his contract terms.
It makes no difference if someone has renewed a contract and is on a second visa, or if there is a personal reason for wanting to end employment. No gratuity will be payable as SN is resigning with fewer than five years of service with a fixed-term contract.
Provided the employer agrees to the termination, as SN has worked for the company for more than two years, there is no need for an employment ban but that is dependent on the employer.
Given the service and level of salary, an employment ban can be overturned by a letter of no objection. This may be academic, however, as SN states he will return to his home country.
Keren Bobker is an independent financial adviser and senior partner with Holborn Assets in Dubai. Contact her at keren@holbornassets.com. Follow her on Twitter at @ FinancialUAE
The advice provided in our columns does not constitute legal advice and is provided for information only