Do I have to agree to a limited-term contract?

Company says employer is only entitled to a limited-term contract

  • Posted by Bassam Za'Za', Legal and Court Correspondent
  • Published: 17:11 May 23, 2013

  • Image Credit: Supplied

I have been working in a company for more than two years on a limited contract. My contract expired one month ago and I did not sign a new contract with my company, as I am still working with the company. Presently, my company is asking me to sign a new employment contract with a limited period for 2 years otherwise they are going to stop my salary, but I refused to sign the same as I do not want to continue with the company in a limited contract. I told them I will sign only unlimited contract but the company refuses the same stating that as per the Labour Law; I must sign a contract for limited period, because my previous one was for limited period and I agreed to continue working on the same condition for more than one month as per my company. Please advise me.

I would like to clarify to you that article 40 of the UAE Labour Law states the following: “Where the two parties continue to perform the contract, without an expressed agreement, after the expiry of its initial period or after the completion of the work agreed upon, the original contract shall be deemed to have been tacitly extended on the same conditions as those already contained therein, other than the condition respecting its duration”. Therefore, such article does not oblige you to sign a contract for limited period as per the above mentioned article unless the contract contains a provision to the contrary.

Readers’ questions answered by Advocate Mohammad Ebrahim Al Shaiba of Al Shaiba Advocates and Legal Consultants