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Free zones do not impose ban.

I have worked for a free zone company for one and a half years. If my company terminates my service due to low business, do I still face a six-month ban? Can I look for another job after the termination?

Generally, each free zone has its own regulations regulating activities within that particular zone, including labour issues. In addition, some free zones have made special arrangements with the Ministry of Labour so that disputes arising between employers and employees within these free zones are filed directly with the Ministry of Labour. Therefore, it is necessary to see whether your free zone has its own regulations or not and the matter will be dealt with accordingly. Free zones do not impose bans on employees, but may do so if requested by the employer. It all depends on the circumstances leading up to the dismissal of the employee or termination of the employment contract.

However, any ban imposed by a free zone would ordinarily only be applicable within that free zone. It is worth noting the Ministry of Labour has no jurisdiction over free zones, therefore the 6 month employment ban imposed by the Ministry of Labour is not applicable in free zones.

Compensation in 
lieu of notice

I was working for a private company in Dubai for over one year. The company terminated my service on August 6, 2012. My appointment letter stated that the service could be terminated by either side, giving three months' notice. The company paid the salary for the notice period of three months to some employees and only one month to others. What pay am I eligible for and will I be paid only my basic salary or will it include housing and transportation allowances?

A contract is the law for the contracting parties. Since your contract provided a three-month notice period you are entitled to three months' pay. In the case of failing to give you three months' notice, in compliance with Article 119 of the UAE Labour law, you are entitled to compensation in lieu of the notice period which has to be calculated on basic salary. Article 119 states that: "If the employer or the employee has failed to serve notice to the other party for termination of the contract or has reduced the notice period, the party obliged to serve the notice shall pay to the other party an indemnity called 'Compensation in lieu of notice'." It is incurred by the other party as a result of failure to give notice or for reduction of said period, and the indemnity shall be equal to the employee's pay for the notice period in full or in proportion to the diminished part. In regard of employees on monthly, weekly, daily or work per hour pay, the notice allowance shall be computed on the basis of the last pay earned by them.

With regard to employees paid on a piece work basis, allowances shall be calculated on the basis of the average daily pay provided for in Article (57) hereof.

End of service benefits

I have been working on an unlimited contract with a private company here for 10 years. I want to resign and return to my home country. If I submit my resignation, will this affect my end of service benefits or my annual leave balance?

Your resignation will not affect your gratuity or other end of service benefits which are provided by the UAE Labour Law.

zAt the time of resignation, you will be entitled to full gratuity for the entire employment period of ten years in accordance with Article 132 of the UAE Labour Law, which states: "The employee who has completed one year or more in continuous service is entitled to the end of service remuneration at the end of his service. Days of absence from work without pay are not included in computing the period of service, and the remuneration is to be calculated as follows :-

1. Twenty one day's pay for each year of the first five years of service.

2. Thirty days pay for each additional year. Provided that the entire total remuneration shall not exceed two year's pay."

An employee's resignation will affect his entitlement to annual leave as the right of annual leave is granted by the law. Article 75 states: "The employee must be granted an annual leave during each year of service which may not be less than:

1. Two days per month in respect of any employee with more than six months and less than one year of service.

2. Thirty days per annum in respect of any employee whose period of service exceeds on year.

In the event of termination of an employee's service, he shall be entitled to an annual leave for the fractions of the last year of service." Therefore, in the event of your resignation you will be entitled to receive compensation for the annual leave.

Compiled by Ahmed Shban

Copyright 2012 Khaleej Times. All Rights Reserved.

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Publication:Khaleej Times (Dubai, United Arab Emirates)
Date:Dec 4, 2012
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