This article explains the legal framework surrounding the termination of employment due to business downturn in UAE.
It also outlines how our law firm provides expert legal services for clients dealing with employment disputes related to business downturns in 2024.
Contact our expert labor law firm in UAE. Click the WhatsApp icon below.
Table of Contents
Termination of Employment Due to Business Downturn in UAE Law
In the UAE, termination of employment due to a business downturn is governed by Federal Decree-Law No. 33 of 2021 and subsequent amendments.
The law allows for termination in economic distress, restructuring, or bankruptcy.
Employers must provide a valid reason, such as cost-saving measures or a business closure, and comply with the legal requirements to avoid claims of arbitrary dismissal.
In such cases, a key element of legal terminations includes a notice period, typically 30 days for employees with service under five years and longer for more tenured employees.
End-of-service benefits, including gratuity, are required if the employee has completed at least one year of service, and repatriation costs must be covered if the employee plans to return to their home country.
Employees who believe they were terminated unfairly due to a downturn can file complaints with the Ministry of Human Resources and Emiratisation (MOHRE), which, if not resolved, may lead to a court case.
If the dismissal is deemed arbitrary, employees may receive compensation of up to three months’ salary in addition to other entitlements.
We recommend that you read about the termination due to redundancy in UAE Dubai and learn about the Labour Law for Termination of Employment in UAE.
Legal Services for Business Downturn Terminations in UAE
Our labor lawyer in Dubai specializes in handling termination cases related to business downturns, ensuring that the rights of both employers and employees are respected in compliance with UAE labor laws. Our legal services include:
- Employment Dispute Resolution: We represent clients in disputes over unfair dismissal or termination due to economic reasons. We aim to resolve matters through mediation or court representation if necessary.
- End-of-Service Benefits Calculation: We assist in calculating and securing any outstanding benefits, including gratuity and unpaid wages, to ensure fair compensation.
- Arbitration and Litigation: Our lawyers handle wrongful termination cases, representing clients at MOHRE or the UAE courts to pursue compensation for arbitrary or unlawful dismissals.
- Contractual Obligations: We provide guidance on notice periods, severance packages, and other contractual obligations in line with UAE labor law.
Our experienced legal consultants ensure that every aspect of employment termination is handled precisely, ensuring compliance with all relevant labor regulations.
Read about Employee rights on termination in UAE Dubai.
FAQs about Business Downturn Employment Ending in UAE
Conclusion.
Termination of employment due to business downturn in UAE is a sensitive and regulated process, with laws designed to protect both employers and employees.
Employers must follow legal protocols, such as providing notice and paying end-of-service benefits, while employees have the right to challenge unfair or arbitrary dismissals.
As business conditions evolve, ensuring that all terminations are justified and compliant with UAE labor laws is essential to avoid legal disputes.
Our law firm can provide expert legal guidance and representation if you are facing or managing employment termination due to a business downturn.
With specialized knowledge of UAE labor law, we ensure that employers and employees navigate the complexities of termination smoothly and comply with legal standards.
Contact our labor law firm in UAE for expert help. Click the Whatsapp icon below.
A legal consultant specializing in UAE labor law. He regularly publishes articles on the website and writes on various areas of UAE law, with a specific focus on labor law.
