I have worked in a company for more than five years. Two months ago, I applied for one-month annual leave, spent my leave and returned to the company but they asked me to sign a paper stating the annual leave shall be unpaid [and the sum] will be deducted from my salary, which I declined to do. They told me that due to the company’s financial problems, they do not have a job for me and asked me to search for another job, and if I failed to do so, they said they would terminate my services. As I could not find another appropriate job, I went back to them and asked them to reinstate me upon which they gave me a termination letter. I have not received my salary for more than four months, they have asked me to leave immediately even though my contract with the company is for an unlimited period.
My first question; is the company’s conduct contrary to the UAE Labour Law and can it be deemed to be an arbitrary dismissal? Second: am I entitled to the salary for the period in which I searched for a job, especially since I have not worked in the company during the said period? Third: am I entitled to a one-month notice period as six months ago, the company asked me to reduce the notice period to 15 days and I signed a letter with them for a notice period reduction? Please advise.
The questioner’s termination by the employer might be considered as an arbitrary dismissal by the concerned court whereby the company shall compensate the questioner a maximum of 3 months salaries. The questioner is also entitled to claim his salaries for the period in which he was suspended and searching for a new job, as the questioner is, as per the law, considered to be in his position even if the company did not provide him with the job. In accordance with the UAE Labour law, the company is responsible for providing work for the questioner as long as he is still under its sponsorship and his contract is not yet terminated.
As for the notice pay, the questioner is entitled to one month’s salary for the notice period pay. Also, reducing the notice period to less than a month is invalid and against the Labour Law because as per the UAE Labour Law, the parties may not agree to reduce the notice period, but may agree to increase it.
Manager demoted
I have worked as a marketing manager for a company for more than three years. A month ago, the managing director told me that he is going to close down the marketing department to reduce the company’s expenses and that subsequently, my job would be terminated. He gave me the option of working in another department with less salary and less commission with my job no longer being that of a manager. My question; is the company entitled by law to terminate me due to closure of a department? In case of termination, is it deemed to be an arbitrary dismissal? Is the company entitled to reduce my salary and my position if I agree to a transfer to another department? Please advise.
The Dubai Cassation Court entitles the employer to restructure his firm in accordance with its economic activities and take the necessary means to prevent the risks of loss, which might occur to the company. Therefore, the closure of a department in the company or cancellation of certain jobs in such department for the purpose of structuring and avoiding losses therein is a valid legal procedure provided that the procedure made by the employer shall not be intended to harm the employee. Therefore, the termination of the employee for that reason is a valid dismissal, not arbitrary, and the questioner has an option to transfer to another department with a new salary and position agreed upon between parties.
Questions answered by advocate Mohammad Ebrahim Al Shaiba of Al Shaiba Advocates and Legal Consultants.
