Can you terminate an employee for redundancy?

Yes, companies can fire a worker for redundancy under certain conditions. It is called redundancy when a job becomes superfluous or useless due to various factors, including organizational restructuring, technology developments, or economic difficulties. However, employers must comply with applicable labour laws and regulations when implementing redundancy dismissals.

What is the difference between redundancy and termination?

Redundancy and termination are two distinct concepts in the context of employment. Redundancy is a specific reason for termination, but not all terminations are due to redundancy. Termination can occur for various reasons, while redundancy relates to the job becoming unnecessary or obsolete within the organization.

What is redundancy in employment?

Redundancy in employment refers to the termination of an employee's position when it is no longer required due to changed business needs, a different work environment, or the complete shutdown of a company.

What are the legal responsibilities of employers in the UAE when terminating employees due to redundancy?

Employers must provide written notification, adhere to the notice period specified in labor regulations and employment contracts, and furnish a redundancy letter with clear reasons for termination.

What rights do employees laid off for redundancy have in the UAE?

Employees are entitled to end-of-service rewards (gratuities) based on their service history, a notice period as specified in their employment contract, and a redundancy termination letter explaining the reasons for termination.

Is redundancy recognized as a valid reason for termination under UAE labor laws?

Yes, redundancy is recognized as a valid basis for dismissal under Article 117 of the UAE Labour Law, especially when it is aimed at cost-saving measures and not due to incompetence or wrongdoing on the part of the employee.

Termination Due to Redundancy in UAE 2024

This article aims to provide accurate and valuable legal information about termination due to redundancy in UAE in 2024 and list the related legal services provided by Al Mulla Lawyers & Legal Consultants.

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

Termination due to Redundancy in UAE Details

Redundancy termination can be challenging for employees, causing uncertainty about their legal rights.

For this reason, businesses must comprehend labour regulations to ensure compliance when terminating employees.

Employers’ legal responsibilities include providing written notification and adhering to the notice period required by UAE labour regulations and employment contracts.

The duration of the employee’s service usually determines the notice period.

Employers must also furnish a redundancy letter to the affected employee, clearly stating the reasons for termination and providing essential discharge details.

Employee’s Rights when Laid off for Redundancy

Employees who face termination due to redundancy in UAE are entitled to various rights and benefits stipulated by UAE labour laws. These include:

Upon termination, employees are eligible to earn end-of-service rewards, sometimes known as gratuities. The gratuity amount is determined based on the employee’s service history and termination pay.
Notice Period. Workers have the right to a notice period to prepare for the future. The length of the notice period is typically specified within the employment contract and is contingent upon the duration of the employee’s tenure within the organization.
Employees laid off due to redundancy are entitled to compensation for unused leave. Additionally, employees can claim UAE redundancy compensation if the redundancy leads to arbitrary dismissal (for instance, if proper procedure is not followed).

To conclude, when employees are laid off for redundancy, they are entitled to statutory payments such as notice pay, end-of-service gratuity, and accrued leave. However, there is no statutory obligation for “redundancy payments” beyond these.

Read about Legal Notice to Employee UAE.

Redundancy termination UAE law

What is redundancy in UAE labor law as of 2024?

Due to the lack of a clearly defined statutory term for redundancy termination, there is confusion about the proper legal course of action.

Typically, termination of employment redundancy letter refers to firing an employee whose particular position is no longer required.

Dismissals due to redundancy are not the employee’s responsibility because they are not the result of incompetence or wrongdoing.

Instead, they happen due to altered business needs, a changed work environment, or a company’s complete shutdown.

Redundancy is a valid reason for dismissal under Article 117 of the UAE Labour Law when a company terminates an employee to cut costs.

Depending on the particular conditions and the workforce size that the process will affect, the precise components of the redundancy process will change.

A fair and thorough procedure should typically include a combined meeting with all workers impacted by the redundancy and individual sessions with each person impacted.

The company and the impacted employees should consider alternatives to layoffs as part of their duties.

This may include reevaluating employee benefits, exploring positions in different industries, or considering part-time or reduced work hours.

The corporation should ensure that everyone is fully informed at every stage of the procedure by sending official letters and frequent updates to the workforce.

The employees should also be given the relevant documentation of the employment termination due to redundancy and the overall economic condition.

Legal Services Related to Redundancy Termination in UAE

Al Mulla Lawyers & Legal Consultants offer comprehensive legal services related to termination due to redundancy in the UAE. These services include:

Legal Consultation on Redundancy Procedures: Guidance on adhering to UAE labor laws when terminating employees due to redundancy, ensuring compliance with Article 117 of the UAE Labour Law.
Drafting and Reviewing Redundancy Letters: Assistance with preparing legally sound redundancy letters, outlining the reasons for termination, and ensuring clear communication of the process.
Notice Period and End-of-Service Calculation: Legal advice on calculating appropriate notice periods and end-of-service gratuities based on the employee’s tenure and service history following UAE regulations.
Arbitrary Dismissal Claims: Representation for employers and employees in cases where redundancy may lead to claims of arbitrary dismissal, ensuring that proper procedures are followed to avoid legal disputes.
Dispute Resolution and Legal Representation: Support resolving disputes arising from redundancy-related terminations, including negotiation, mediation, or court representation if necessary.

These specialized services ensure employers and employees navigate redundancy-related issues in compliance with UAE labor laws, minimizing risks and ensuring a fair process.

Learn about the New UAE labor law on termination of the contract, Wrongful contract termination and the Best 5 wrongful termination lawyers in UAE Dubai.

FAQs about redundancy termination UAE

In Summary.

Understanding termination due to redundancy in UAE is crucial for employees and employers.

Employees should be aware of their entitlements, such as notice periods and end-of-service benefits, while employers must adhere to legal requirements when implementing redundancies.

Seeking guidance from experts like Al Mulla’s office can provide invaluable support and ensure a fair resolution.

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.

Termination due to redundancy in UAE