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 laws.
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Table of Contents
If a Business is Closing what are Employees Rights?
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.
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 2023.
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 transferred to the new business will receive entitlements based on the negotiation between the old and new owners.
These entitlements could include accrued leave and outstanding wages. However, the new owner may not recognize all obligations.
Understanding the Scenario: Closure or Sale of Business.
Primarily, 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.
Closure 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, the employees may find themselves transitioning to the new business. This transition ends their employment with the original business that has been sold.
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 the office of Al Mulla via Whatsapp. Click here. Or visit us at our law firms: Dubai. You can also call us on phone: 00971501961291.
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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.