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The following essay discusses briefly the important
aspects of Labour Law in the UAE.
Introduction
Labour cases in the UAE are governed by Federal Law No. 8 of
1980 Regulating Labour Relations as amended by Federal Laws No. 24
of 1981, No. 15 of 1985 and No. 12 of 1986 (the "Law").
According to Article 3 of the Law, the law applies to all employees
and workers in the UAE including UAE nationals and expatriates. It
should be noted that partners in a business are not considered as
'employees'; instead they are treated as
'investors' in their businesses. However, if the partner
holds an employee position, additional to his status as partner, he
will be considered as an 'employee' working in the company.
The Ministry of Labor and Social Affairs (the Ministry) is the main
body responsible for regulating manpower recruitment and it
facilitates to settle disputes between employers and employees.
Free-Zones and the Law
The employees in a freezone are sponsored by relevant free
zone(s), and not their employers. Jebel Ali and Dubai International
Free Zone have their own rules and regulations and they maintain
their own employment contracts. However, the Law will still apply
and the provisions should be in accordance with the Law. In the
event of a dispute, the employees maintain their right of action
against employers, not the relevant sponsoring free zone authority.
It is advisable that employees' provide bank guarantees, to the
relevant free zone authorities, in order to secure their dues and
end of service incentive which may be payable upon termination of
their employment contracts.
What does the Law encompasses?
The Law covers every aspect in relation to the employee-employer
relationship including employment contract, wages, working hours,
incentives, medical and social care, restrictions on the employment
of women and juvenile, safety and protection of employees,
penalties and employment related accidents, injuries and death.
Enforceability of the Law
The Law is Federal and it applies all the Emirates of UAE. It is
enforced by the Ministry. All disputes relating to Labour matters
must first be referred to the Ministry, if an amicable settlement
is not reached, then the Ministry could delegate the matter to the
court for litigation. Labour related disputes are adjudicated by
the Ministry and the local courts of the UAE.
Termination of Contract
A contract may be terminated in the following circumstances:
If employee consents to cancel the contract in agreement with
the employer.
If the term of the contract has ended, and it is not extended
according to the implied and explicit provisions of the Law.
A contract may be terminated by one of the parties by serving a
timely notice, provided that the parties observe the provisions of
the Law and accept reasons to cancel the contract without
prejudice.
There may be circumstances where an employer wants to terminate
the contract without serving a timely notice and with immediate
effect. As per Article 120 of the Law, the employer may dismiss the
employee in the following cases:
If the employee was appointed under probation and was
terminated before the end of probation period.
If the employee commits a mistake which causes substantial
losses to the concerned employer, provided a notice was served to
the Ministry within 48 hours.
If the employee fails to carry out his basic duties and
obligations, after serving a written warning letter by the
employer.
If he confides secrets of his establishment to a potential
competitor.
If he is drunk or intoxicated during working hours.
If he physically assaults his employer or a manager or any
colleague during work.
If he remains absent, without a legitimate reason, continuously
for 20 days without giving any information to the employer.
If the employee violates safety instruction, provided those
instructions were written and employee was made aware of those
instructions orally if he is illiterate.
Dispute Settlement
As stated earlier, if there is a dispute between an employer and
an employee, the case should be filed at Ministry and they will do
their best to settle the dispute amicably. However, if the parties
fail to reach a mutual agreement then Ministry will send an
application to the Court, highlighting the dispute, and they will
then adjudicate the matter. Both the parties will be summoned to
state their respective arguments and then the court will schedule a
hearing date and summon parties to hear the matter.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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