Question: I'm from Pakistan and have been working in the UAE for just over a year, under a limited two-year contract. However, my employer has decided to terminate my contract due to lack of business and I want to know what legal rights I have in claiming unpaid overtime, gratuities and holiday pay, which I have not been allowed to take to date. Under the UAE labour law what am I entitled to?
Answer: I can understand that the predicament in which you find yourself is stressful and worrying. However, it's good to know that the UAE labour law is specific in regards to your queries and in most cases supersedes individual employment contracts, if the individual terms are worse.
In your case I would advise taking a good look at your contract with the help of a lawyer who specialises in labour law, to determine what exactly you're entitled to under the contract. You should also elicit the help of an independent financial adviser as to the best way to save and invest any money you gain as a result of the termination.
Limited contract
As your contract is limited, there will be a commencement and a completion date specified and under the labour law, if your employer terminates the contract before the completion date due to an ‘unreasonable cause', which includes lack of business, then he is liable to pay you compensation under Article 115. This compensation is determined on the basis of a half a month's wages for a period of three months or for the remaining period of the contract, whichever is less.
However, this compensation is null and void if there is an article in your contract that states otherwise. You are entitled to all outstanding salary payments including overtime, which should be set out in your contract, as well as payment for all unused holidays to date.
You say your employer has not allowed you to take any holiday for the past year, which contravenes UAE labour law, which stipulates that all employees should receive two days leave for every month of service if this is more than six months and less than one year. If you have worked for more than a year, then you are entitled to a minimum of 30 days holidays annuall
Gratuity
The period of 30 days includes statutory holidays, such as National Day and Eid holidays. Gratuity should also be paid to you in full — calculated on the duration of your employment.
Under the UAE labour law all employees are entitled to wages for 21 days for each year of the first five years of service.
In light, of this it sounds as if you could be due a hefty lump sum in unpaid overtime, holidays and gratuities, as well as compensation for the early termination of your contract.
What you do with this money is your next concern. If you plan to go back to Pakistan, then your employer will also be required to pay for the costs of your repatriation.
Offshore account
Taking your money out of the country, however, may be more difficult. If you want to avoid being taxed in Pakistan then it is wise to set up an offshore account where your money can be saved and invested safely without incurring any in-country fines.
A financial adviser can help you with this, as well as assisting you with drawing up a long-term financial plan to include provisions for savings, investments, retirement and health insurance, for you and your family, if you plan to remain in the UAE.
The writer is a solicitor and senior estate planning consultant with Nexus Insurance Brokers LLC. The opinions expressed are the writer's own and do not necessarily reflect that of his organisation or of Gulf News. If you have any questions, please email advice@gulfnews.com
