Legal Question in Employment Law in United Arab Emirates

Hi,

Your Query does not have all the required information. It is to be presumed that your Company is located in a Free Zone, if so then the Labour Laws if any of that Free Zone would apply. You have not mentioned the period of the "Limited Contract" and whether the Employee had issued necessary "Notice of Resignation" and served the Notice period. Without all the required information and perusing all the necessary Documents, it would be difficult providing you with a categorical answer to your Query.

However for your general information, as per UAE Labour Law, if an Employee is on Unlimited Term Contract and resigns with one months notice after serving employment for a period between 1-3 years, he would be eligible for a Gratuity of 7 days salary per year of service. whereas, if the Employee is on Fixed Term Contract and resigns prior to expiry of Contract, serving less than 5 years of Employment, he would not be eligible for any Gratuity and may if he has not served the entire Notice period be liable to pay 45 days Salary to the Company.

In my view you may attempt to invoke the Clause applicable for Limited Contract, presuming that the Labour Laws applicable in your Free Zone is on similar lines.

For further clarifications if any, you may mail to [email protected] or call on 0502104389.

Best Regards,

25.08.2013

Dear Sivakumar,

You ought to take into consideration that the employee has persisted with remaining employed in your Company, despite not being paid salary for 4 to 5 months due to the Company having financial constraints. I am of the view that it is always advisable to part with an employee on good terms ... simply because the Company is bigger than the individual. The standard rule for payment of Gratuity is one half month's salary for each year of completed service. So the employee should be paid 63.75 ie. 64 days salary as Gratuity for the 4 years and 3 months that he has served in the Company.

Regards,