In the DMCC Free Zone, employment relationships are governed by Federal Decree-Law No. 33 of 2021, which sets out the legal framework for employment, including contract termination.
This article outlines key provisions related to DMCC labour law termination, helping both employers and employees understand their rights and obligations.
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Table of Contents
DMCC Labour Law Termination
Federal Decree-Law No. 33 of 2021 provides comprehensive guidelines on employment contract termination.
It covers various scenarios, such as mutual agreement, contract expiry, and termination due to circumstances like employer insolvency, employee misconduct, or death.
Grounds for Termination
Under Article (42), employment contracts in the DMCC Free Zone may be terminated in the following cases:
- Mutual agreement between the employer and employee to end the contract.
- Contract expiry, unless renewed or extended.
- Termination based on either party’s wish, provided proper notice is given as per the contract terms.
- Employer’s death, when the contract is linked to the employer’s personal entity.
- Employee’s death or permanent disability, confirmed by medical documentation.
- Employer bankruptcy or closure of the establishment.
- Worker’s failure to renew their work permit, when the cause is beyond the employer’s control.
Additionally, dismissal without notice is permitted in cases of serious misconduct, such as fraud, negligence, and violation of safety rules.
Notice Period and Compensation
Article (43) establishes that the notice period for termination should be between 30 and 90 days, depending on the employment contract.
If either party fails to respect the notice period, they must compensate the other party for the full notice period or the remaining period of notice.
Employers are also allowed to offer additional benefits to employees, beyond the statutory requirements, as part of their employment contract.
This flexibility can be used to attract and retain skilled workers, helping employers provide more competitive packages tailored to individual needs.
However, any extra benefits offered must comply with the agreed contractual terms and cannot undermine the rights established under the law.
End of Service Benefits
Employees who complete at least one year of continuous service are entitled to end-of-service benefits, as detailed in Article (51).
DMCC Gratuity Calculation is based on the employee’s basic wage: 21 days of wage for each year within the first five years and 30 days of wage for each year beyond five years.
Employers must pay all due entitlements, including wages and benefits, within 14 days of the contract’s termination, as per Article (53).
If any additional benefits are promised contractually, they should also be settled in accordance with the employment agreement.
Legal Services Related to Labour Termination in DMCC
Ending of an employment contract, whether voluntary or involuntary, must comply with the regulations of DMCC labour law termination governed by the UAE’s Federal Decree-Law No. 33 of 2021.
Our labor lawyer in Dubai provides expert legal services to ensure employers and employees navigate this process effectively. We specialize in:
Employment Contract Review and Drafting
We help employers draft contracts that meet DMCC regulations and advise on including additional benefits to attract and retain talented employees.
Employers can offer benefits that exceed the statutory requirements, provided they are contractually agreed upon.
Resolving Termination Disputes
Our legal team guides the resolution of termination disputes, including issues related to unjust termination, breach of notice periods, and conflicts regarding end-of-service benefits.
Dismissal Without Notice
In cases of dismissal without notice, we assist employers and employees by ensuring proper investigations are conducted and the termination complies with the law.
End-of-Service Benefits Calculation
We assist employers in calculating accurate end-of-service benefits and ensuring that employees are paid their entitlements. We also handle disputes regarding the payment of benefits.
Labour Complaints and Claims
We represent employers and employees in filing complaints related to wrongful termination, breach of contract, or violations of workplace rights.
Additional Benefits and Contract Flexibility
Employers are free to offer additional benefits to attract skilled employees, provided these benefits are contractually agreed upon.
Our legal team can help employers structure these benefits and ensure they align with the law.
FAQs about Employment Termination in DMCC
For expert legal advice and representation on DMCC labour law termination matters, contact our law firm today to ensure that your rights and obligations are fully protected under UAE law.
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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.
