When Does An Employee's Right To Claim Labour Entitlements Lapse?Legislative Amendments And Recent Judicial Trends Grant Employees Broader Protection And A Longer Period To Claim Their Rights

The issue of the lapse of an employee's right to claim labour entitlements is one of the most complex matters in practical application and employment relationships. UAE legislation in this regard has witnessed notable development, supported by recent judicial trends that have strengthened such rights and expanded the scope of their legal safeguards.

Federal Decree-Law No. (33) of 2021 Regulating Labour Relations(UAE Labor Law), in its original version, stipulated that labour claims brought by an employee would not be heard after the lapse of one year from the date the entitlement became due, regardless of whether the employment relationship was still ongoing. Accordingly, if one year elapsed from the date a labour right accrued without the employee filing a judicial claim even if the employment relationship was still in force the employee's right to bring such a claim would lapse. The continuation of the employment relationship was not considered an acceptable excuse for failing to initiate legal proceedings to claim those rights.

This provision created a clear practical dilemma, as many employees were reluctant to pursue judicial claims during the subsistence of the employment relationship despite the commencement of the limitation period. Such reluctance stemmed from fear of entering into a legal dispute with the employer that might result in termination of employment or, at the very least, adversely affect their professional standing. This situation constituted what may be described as a "moral impediment", preventing employees from exercising a right guaranteed by the Constitution of the United Arab Emirates, namely the right of litigation.

Recognising this issue, the UAE legislator intervened by replacing the previous provision with a new text, introducing a fundamental shift in the philosophy governing the calculation of the period for non-admission of labour claims, as follows:

1. The legislator amended the limitation period for labour claims, extending it to two years instead of one year.
2. More importantly, the legislator introduced a new commencement date for calculating this period namely, the date of termination of the employment relationship rather than the date on which the labour right became due. This amendment reflects the legislator's recognition that, upon termination of employment, the employee's will becomes free to claim such rights without pressure or fear of repercussions arising from the claim. After that point, the employee no longer has a justified excuse for delaying the pursuit of those claims.

In line with this legislative approach, the General Assembly of the Abu Dhabi Court of Cassation, in a significant judgment issued on 18 December 2025, affirmed that labour rights arising prior to the new amendment coming in force on 1 September 2024 are also subject to a limitation period of two years instead of the one-year period stipulated in the repealed provision. This is subject to the condition that the original one-year limitation period had not already been lapsed by the date the new amendment came into force. However, in such cases, the commencement date for calculating the limitation period remains the date on which the claimed right became due, as determined by the previous provision under which the right arose, and not the date of termination of the employment relationship, which was introduced by the new text.

In conclusion, the UAE Labour Law has strengthened employee protections through two key changes: the limitation period for labour claims has been extended to two years, and its commencement now generally aligns with the termination of employment, allowing claims to be made freely without fear of repercussions. Further the subject judgment issued by the Abu Dhabi Court of Cassation clarifies that pre-amendment rights are also subject to the extended period provided the original one-year limitation had not expired while retaining the original accrual date as the start for any such entitlements' calculation. This commendable legislative and judicial movement offers significant protection to the employees' rights as it enables the employees to claim their rights with full freedom of will, free from any constraints or pressures that may hinder the exercise of their constitutional right to access the courts thereby contributing to fostering an attractive working environment within the UAE.

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