Ask the Law: Manager did not receive salary for more than a year
Company board rejected manager’s resignation
Question:
I am a partner and director of a limited liability company. A month ago, I submitted my resignation from work in the company and asked the company’s board of directors to accept my resignation and appoint a new manager, but the board rejected my resignation and asked me to return to work.
The reason for my resignation is that I did not receive salaries for more than a year, and currently the Board of Directors tells me that I have no legal right to claim late salaries for more than a year. My question, is this correct, according to the law? Am I legally entitled to leave work in the company after serving the required notice period? What are the legal procedures to be taken to obtain my right? Please advise.
Answer:
I would advise the following:
It is true that the Labour Law states in its Article 54 that (“A lawsuit related to any of the rights accrued under the provisions of this Decree-Law shall become time-barred after the lapse of one (1) year from the date of entitlement to the right that is the subject matter of the lawsuit”).
Moreover, Article 85 of the UAE Commercial Companies Law states that (“The manager may file a written resignation to the general assembly, provided that he notifies the Competent Authority with a copy thereof. The general assembly shall issue its decision on such resignation within (40) forty days from the date of its submission, otherwise his resignation shall be deemed effective as of the expiry of this period, unless the Memorandum of Association of the Company or the contract of appointment provides otherwise.”)
Regarding your rights, if you were the manager in the license and was appointed in the Memorandum of Association of the Company or under an independent appointment contract, and you are taking your remunerations as per this MOA or contract, then the general assembly should take the decision about your resignation, not the Board of Directors — unless the Memorandum of Association of the Company or the contract of appointment provides otherwise, as per Article 85 mentioned above, and the Company shall notify the Competent Authority of the termination of the term of the manager’s appointment within no later than (30) thirty days from the date of the termination of the appointment contract’s term.
The Company shall appoint a replacement thereof during such period. In this event, you have to file your case in front of the civil court without consideration to the one year lapse of time mentioned above.
But if you are a manager with a labour contract and follow the rules of the labour office with the WPS system, notice period…etc., you have to file your case in the Labour Court with consideration to the one year lapse of time mentioned in Article 54 of the Labour Law.
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