Abu Dhabi employer must pay gratuity, repatriate worker at end of contract

The employer has a responsibility under UAE Labour Law to pay its worker all monies that are due to him and to cancel the visa.

Six months ago I resigned from my job as a nursery manager in Abu Dhabi, and despite promises from the owner, the end of service benefit has still not been settled. The residency permit has not been cancelled yet either, even though I have already left the UAE. Will I lose my rights to the payments if my UAE residency is invalidated? All my efforts to get help by visiting the Ministry of Labour office in Mussaffah and calling a dedicated complaint number given to me were to no avail, so how can I secure my rights? IA, Pakistan

The employer has a responsibility under UAE Labour Law to pay IA all monies that are due to him and to cancel the visa. These actions are not optional. As employing a lawyer to handle such issues is very expensive, this is not a viable course of action and IA needs to persist with contacting the Ministry of Labour, as that is his only recourse in this situation. If IA is no longer in the UAE this complicates matters, as his visa and labour card should be cancelled, and generally the individual needs to be in the country for this to happen. Unless there are extenuating circumstances, people should not leave without proper cancellation, as this can cause problems with re-entering the country.

I have finished my two-year limited contract and did not wish to renew. Now my company is refusing to give me a flight ticket to return to my home country. I have filed a complaint and am waiting for feedback. Which law is applicable for that? In my contract it says the employer should provide tickets once we leave. PG, Dubai

Article 131 of UAE Labour Law states that: “Expenses for repatriation of an employee to his place of origin or any other place agreed upon by both parties shall be borne by the employer. If the employee after the end of his contract takes up employment somewhere else, repatriation expenses upon termination of his service shall be paid by the last employer subject to the provisions in the preceding clauses, and if the employer has failed to repatriate the employee and has not paid the repatriation expenses, the competent authorities shall do this at the employer’s expense by way of attachment. If the cause for termination of contract is attributed to the employee, his repatriation will be arranged at his own expense if he has the means to pay”. If an employee has completed a contract, it can be argued that the “cause for termination” is not down to the employee and that the employer should pay. But it will also depend on the wording of the employment contract, so in this case it appears that the employer is liable for the cost of a flight to PG’s home country.

My employment contract states my basic salary as Dh12,000 per month plus allowances of another Dh12,000. I then get a full housing allowance, a car, utilities and schooling paid as allowances above the Dh24,000. The monthly salary paid into my account every month is Dh24,000. How should my basic salary be calculated for gratuity purposes at the end of the employment period? I am 18 months into an open-ended contract with no thoughts of leaving, but I am trying to plan ahead. JD, Abu Dhabi

Ordinarily the end of service gratuity is calculated on the basic salary only, but this unnamed allowance in addition to all the traditional allowances seems a little unusual. In this case, it appears the employer is deliberately keeping the basic salary low to reduce end of service liabilities. Having sought further information, it transpired that JD works for a government-linked entity and UAE Labour Law states: “The provisions of this law are not applicable to the following categories: a) Officials, employees and workers of the federal government, governmental departments of the member emirates of the state, officials, employees and workers of municipalities as well as other officials, employees and workers, working in federal and local public departments and organisations, as well as the officials, employees and workers appointed for governmental federal and local projects”. This means that as JD has signed a contract accepting the remuneration he has no real recourse. Government employers tend to follow labour law, so calculated using the basic salary of Dh12,000, JD is likely to receive 21 days’ basic salary for each year of employment for the first five years and then 30 days after five years of service. Partial years are calculated pro rata and the amounts payable are reduced if the employee leaves of their own accord during the first five years.

Keren Bobker is an independent financial adviser with Holborn Assets in Dubai, with more than 20 years’ experience. Contact her at [e-mail]. Follow her on Twitter at @FinancialUAE.

The advice provided in our columns does not constitute legal advice and is provided for information only.

Follow us on Twitter @TheNationalPF