What happens to employees when a company is sold in UAE?

In accordance with UAE Labor Law, employers must provide employees with a two-month paid notice period before the termination of their contracts.

What happens to employees visa when a company closes in UAE?

Typically, employees can retain their residency visas until the expiration of the company's trade license in many cases.

What are employees' rights in the event of a business closure?

Employees are entitled to receive any pending payments and are left to navigate the job market anew.

What entitlements do employees receive during a change in ownership?

Employees transferred to the new business may receive entitlements based on negotiation between the old and new owners, including accrued leave and outstanding wages.

Why is legal advice important during business transitions?

Legal advice can be invaluable in navigating the complexities of labour law during business transitions, ensuring fair and respectful treatment for all parties involved.

What happens to employees' visas when a company closes in UAE?

Employees can retain their residency visas until the expiration of the company’s trade license, but employers are also responsible for canceling work permits and residency visas of their employees upon the company's closure. The employees then need to transfer their visas to a new sponsor or leave the country.

UAE Company Shutting Down? Know Your Rights as Employee

It’s not uncommon for businesses to close their doors or undergo a change in ownership.

Such changes can leave employees in a state of uncertainty, often wondering, if a business is closing what are employees rights?

This article sheds light on this area, focusing on the UAE labour law regulations you need to know.

Contact Al Mulla Labor Lawyer in Dubai. Click the WhatsApp icon below or go to the Contact Us page. Locations: Dubai, Abu Dhabi and Ras Al Khaimah.

Table of Contents

If a Business is Closing what are Employees Rights in UAE?

During these transitions, employers bear specific responsibilities towards their employees to ensure a fair process. These obligations reflect the principles of respect and fairness the UAE labour laws uphold.

Final Payments finalizing

Firstly, the employer must finalize any pending payments to the employees. This could include salaries, bonuses, or any other form of remuneration due to the employee.

Notice period in uae new labour law 2024

Secondly, the employer is required to provide official notice to the employees regarding the impending changes. The company’s enterprise agreement may have policies concerning the notice period and manner of announcement.

If company terminate an employee in UAE benefits

Employees’ rights and accrued benefits, such as end-of-service gratuity and unused leave, must be preserved when transferring to the new ownership.

This is ensured by the UAE labor law, which mandates that basic rights and accrued benefits are upheld during ownership transitions

Closure or Sale of Business Specifics

There are two scenarios that a business may find itself in—closure or change in ownership. These changes impact the employees differently, and it’s essential to understand the specifics of each situation.

Shutting Down of Business

If a business is on the brink of closure, the inevitable result is the termination of employment for the staff. The employees are then left to navigate the job market anew.

Change in Ownership

On the other hand, when a business is sold, employees may find themselves transitioning to the new business, which ends their employment with the original business.

Legal Services during business closures

Al Mulla Lawyers & Legal Consultants offer comprehensive assistance to employees and employers during business closures or changes in ownership.

They help with understanding labor laws, drafting legal documents, mediating disputes, and providing representation in labor courts.

Additionally, they keep clients informed about legal updates and assist with visa and residency transitions. Contact them through their Dubai office or website for personalized assistance.

Defend Your Rights with the Best Employment Lawyers Dubai, and learn about Employee rights on termination in UAE Dubai 2024. Also, read about the Termination business downturn in UAE Dubai.

FAQs about employee rights when company closes down

Conclusion.

At the end of this article, we hope we have answered your question: if a business is closing what are employees rights?

Understanding the rights of employees in the event of a business closure or sale is crucial for both employers and employees.

The UAE labour laws provide a framework for fair treatment and respect for all parties involved in the transition.

Employers must fulfil their obligations, whether it’s finalizing payments, providing notice, or ensuring a smooth transfer of employees to the new owner. And employees should be aware of their entitlements and rights during this process.

The transition can be managed fairly and respectfully by adhering to the laws and seeking professional legal advice.

Contact Al Mulla Lawyers today! Click the Whatsapp icon below or visit our Contact Us page.
Find us at these locations:
– Dubai: Deira, Port Saeed, Street 8, City Avenue Building, Office 705-708.
– Abu Dhabi: Corniche Street, Golden Tower, Office 22.
– Ras Al Khaimah: Al Nakheel, Al Maamoura Building (Emirates NBD Bank Building), Fourth Floor.

Labor Lawyer

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.