Holding certificates
My employer is holding my original certificates, saying that this is a Ministry of Labour and Dubai Municipality requirement. He says those will be released only when I leave the company. Does my employer have the right to do this? What if my employer refuses to return them? Also, how do I get an experience certificate, what information is mentioned there and what happens if I leave and my employer refuses to issue an experience certificate to me?
Answer
Article 125 of the labour law says: “An employer shall provide a worker, at the latter’s request and on the termination of his contract, with a certificate of termination of his service, which shall be free of charge; it shall specify the dates of his entering and leaving the employer’s service, his total period of service, the nature of the work he has performed, his last remuneration and any bonuses he has received. It shall also be the duty of the employer to return any certificate, documents and tools belonging to the worker.”
The above article entitles the employer to retain the worker’s certificates until the end of service. I would advise you, therefore, to give the employer the original certificates but request written acknowledgement that the certificates are held by the employer so that this can be used in court should the employer refuse to return the certificates.
Liabilities at work
I’m a manager in an LLC Company. What liabilities do I have under the new law?
Answer
Article 84 of the Companies Law states that every manager shall be liable for: Any ‘fraudulent acts’; any losses or expenses incurred due to ‘improper use of power’; contravention of the provisions of any applicable law, the memorandum of association (bylaws) of the LLC or his/her employment contract; or any ‘gross error’. Article 162 of the Companies Law, containing similar provisions, makes a manager liable for an ‘error in management’.
Except the liability for gross error, the old Companies Law has similar provisions relating to the liability of a manager. While article 84 of the new Companies Law introduces the concept of liability for gross error, which potentially increases the liability threshold, article 162 continues to make a manager liable for an error in management.
Article 84 precludes the possibility of limiting a manager’s liability through the LLC’s memorandum of association or the manager’s employment contract. Article 84 states that any provision in the memorandum of association of the LLC or the employment contract in conflict with article 84 shall be deemed void.
Article 165 provides that the company may file a claim for liability against the board of directors for errors causing damage affecting all shareholders. The general assembly must adopt a resolution appointing a person to pursue the claim in the company’s name. Therefore, the partners of an LLC would be similarly permitted to file a claim for indemnification against a manager for losses that the LLC incurred as a result of the manager’s wrongful acts.
Article 167 provides that a decision passed by the general assembly to relieve the board of directors from liability for errors will not prevent the filing of a civil liability lawsuit against the directors in relation to errors committed by them during the performance of their duties. Therefore, a resolution of the general assembly of an LLC that purported to release a manager from liability for his or her errors would be ineffective
The Companies Law does not preclude a manager from maintaining professional liability insurance, or taking an indemnity from the LLC or its shareholders. However, the indemnity may be open to challenge before the courts.
The Companies Law imposes various penalties on managers in case of a breach of provisions of the Companies Law. The penalties are criminal in nature and include fines and imprisonment.
Ask the Law questions are answered by lawyer Mohammad Ebrahim Al Shaiba of Al Shaiba Advocates and Legal Consultants.
