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Early termination of employment contract UAE Dubai

early termination of employment contract

This article provides essential information on the termination of employment in the private sector under the Federal Labour Law.

Excluding the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) free zones.

It explores the various aspects of early termination of employment contract, including ordinary and extraordinary terminations, termination of fixed-term contracts, and termination during the probationary period.

Office of Al Mulla. Whatsapp: Click here. Location: Dubai. Phone: 00971501961291.

Early termination of employment contract.

Ordinary termination of permanent employment contracts requires adherence to specific notice periods:

  • Less than 5 years of service: 30 days’ notice
  • More than 5 years of service: 60 days’ notice
  • More than 10 years of service: 90 days’ notice

During the notice period, the employee must continue to perform their duties and receive their regular salary.

Termination without notice.

For an employer to terminate the contract, there must be a case of serious misconduct by the employee, such as intentional damage to the employer’s property or physical assault on colleagues.

Similarly, an employee can resign without notice if the employer violates contractual obligations or engages in workplace harassment.

New labour law for limited contract in UAE Termination.

Starting from 01.02.2023, fixed-term contracts will be the only valid form of employment contract. Termination of these contracts is regulated by Article 42 of the new labour law.

Fixed-term contracts typically end upon the expiry of the agreed duration. The contract must explicitly state the duration, although extensions can occur through explicit or implicit agreement.

Termination by Agreement, Death, or Total Incapacity:

  • Termination by Agreement.
    Termination agreements must be in writing and cannot circumvent labour law provisions protecting the employee’s rights.
  • Termination due to Death or Total Incapacity.
    The employment contract terminates in the event of an employee’s death or total incapacity. Total incapacity requires a medical certificate, while partial incapacity may lead to a change in employment if requested by the employee.

Notice period in UAE new labour law 2023.

  • Ordinary Notice.
    Termination of fixed-term contracts by notice is possible if there is a legitimate reason, such as the employer’s bankruptcy or exceptional economic reasons beyond their control. A notice period of at least 30 days (up to 90 days) applies unless otherwise specified in the contract.
  • Extraordinary Notice.
    Extraordinary termination of fixed-term contracts is now permissible under the new labour law, similar to the conditions outlined for extraordinary termination of permanent contracts.

Termination during the Probationary Period.

During the probationary period, the employer must provide a minimum notice period of 14 days for termination. Different notice periods apply based on whether the employee intends to transfer to another employer or leave the UAE altogether.

FAQs about early termination of employment contract.

An employer can terminate a permanent contract for serious misconduct by the employee, such as physical assault on colleagues.
The minimum notice period for termination during the probationary period is 14 days.

Conclusion.

Understanding the early termination of employment contracts in the UAE is crucial for employers and employees. The new labour law has introduced significant changes, including abolishing permanent contracts and implementing fixed-term contracts.

Individuals need to familiarize themselves with the specific provisions regarding ordinary and extraordinary terminations, termination of fixed-term contracts, and termination during the probationary period.

Should any legal assistance be required, Al Mulla, a renowned labour lawyer and legal consultant, is highly recommended for labour contract cases in the UAE.

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.

We recommend you read about the Early termination fixed contract by the employer and the Unlimited contract termination. Also, understand the UAE labour law termination pay Contract Ending in Dubai.

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