Dubai: Getting a new job offer is exciting, but what happens if your new company expects you to join immediately? What can you do about the notice period that you are required to serve, as per your contract?
In the UAE, labour relations in the private sector are governed under Federal Decree-Law No. 33 of 2021, also referred to as the UAE Labour Law. As per the law, both employers and employees must provide written notice when terminating an employment contract. This notice period allows for a smooth handover of duties and helps employers find a replacement.
This notice period can be anywhere between 30 to 90 days and as a worker, not serving your notice period can lead to financial liabilities – if you fail to serve your notice period, you would be required to compensate your employer for the period that you failed to serve the notice, something that is referred to in the law as ‘payment in lieu of notice’.
Why do I need to compensate my employer?
Explaining why an employee needs to pay the compensation to the employer, Zeiad Yehia, senior legal counsel at Kashwani Law Firm, said: “Compensation in the Labour Law of the UAE differs from that in Civil Law. While Civil Law requires fault, damage and a causal connection to award compensation, Labour Law operates differently. Under Article 43 (3) of UAE’s Labour Law, even if one party fails to give notice as agreed, compensation is due to the other party, regardless of any actual harm caused. The compensation equals the worker’s wage for the entire notice period. It is crucial to note that the term salary during the notice period refers to the gross salary, including allowances.”
"The compensation shall be equal to the worker's remuneration for the entire notice period or the remaining part thereof," he added.
So, if you fail to provide the required notice before quitting, you may be asked by the employer to compensate for it.
It is crucial to note that the term salary during the notice period refers to the gross salary, including allowances.
You may be asked to pay this after your employer settles all your dues or even through a court, if there is a disagreement, which leads to a court case.
How is the notice period allowance calculated?
As per Article 43, Clause 4, the notice period allowance is calculated according to the last wage received by the worker. Whether you receive your salary on a monthly, weekly, daily or hourly basis.
