I have worked in a company for almost five years on a limited period contract, which expires in May this year. I intend to resign when the contract expires as I am planning to set up a company. Last year, my company forced me to take leave for six months without pay because it was facing a financial problem. Now, the company says that, as per the law, the unpaid leave shall not be included in the calculation of my end-of-service benefits. According to the company, my service period shall be calculated as less than five years. Should the six-month unpaid leave not be included in my tenure of service?
Article 132 of the Federal Labour Law No. 8 of 1980 states: “A worker who has completed a period of one or more years of continuous service shall be entitled to severance pay on the termination of his employment. The days of absence from work without pay shall not be included in calculating the period of service. The severance pay shall be calculated as follows: 1) 21 days’ remuneration for each year of the first five years of service. 2) 30 days’ remuneration for each additional year of service provided that the aggregate amount of severance pay shall not exceed two years’ remuneration.”
Regarding the unpaid leave, such leave should be included in the total service period when calculating the end-of-service benefits if the employee was forced by the employer to take that leave.
I had worked in a company for more than four years. Four months ago, I returned to the company after I finished my annual leave. The day I came back from my annual leave, my company suspended me and did not allow me to work. Company officials told me that due to the company’s financial problems, they did not have a job for me and could not pay my salary. My employer asked me to search for a job, otherwise he would terminate my service. I have been sitting at home jobless for four months. Last month, I went to the company and asked them to allow me to work and pay my salary. They immediately gave me a termination letter and asked me to leave work immediately. They did not even allow me to work during the notice period stipulated as two months as per my labour contract. Is this action against the UAE Labour Law? Am I entitled to salary for the period during which I was not allowed to work? Am I entitled to pay for the two-month notice period?
The termination of the questioner’s service by the employer might be considered as arbitrary dismissal by the court concerned whereby the company shall compensate the questioner with three months’ full salary. The questioner is also entitled to claim his salary for the period in which he was suspended by the employer and not allowed to work, as the questioner would be considered as working with the employer, as per the UAE Labour Law, even if the company did not give him any work. The company is responsible for giving work to the questioner as long as his labour contract is not terminated. As for the notice period pay, the questioner is entitled to two months’ salary.
Questions answered by advocate Mohammad Ebrahim Al Shaiba of Al Shaiba Advocates and Legal Consultants.