An employee in Dubai has won Dh336,000 in end-of-service benefits after a lengthy dispute with the employer. The employee had filed a complaint to the Ministry of Human Resources and Emiratisation after the two parties failed to settle the issue amicably.
The claimant started work in the organisation in July 1996 and was under an indefinite contract until May 2023, marking a service period of nearly 27 years.
A pivotal factor in the court’s decision was an expert report that confirmed the claimant’s employment timeline and final salary of Dh14,000. Based on this, the court applied Article 51 of Federal Decree-Law No. 33 of 2021 on the Regulation of Labour Relations to determine the end-of-service gratuity. The court followed the legal formula: 21 days’ wages for each of the first five years and 30 days’ pay for each subsequent year, capped at a total of two years’ wages.
The court also clarified that any waiver or settlement of end-of-service benefits made before the end of the employment relationship is void. This rendered previously claimed payments by the employer invalid, contributing to the total award.
“This decision reaffirms a fundamental principle of UAE labour law — employees cannot be compelled to waive their end-of-service benefits before the employment relationship ends. Any such waiver or settlement is unenforceable. This protects employees’ rights and ensures they receive their full statutory entitlements,” said legal advisor Vishal Tinani, who led the case on behalf of the employee.
While the claimant prevailed on the main issue, not all demands were granted. The court rejected a request for Dh4,000 for a return flight ticket, citing that the termination did not obligate the employer to bear this cost. Additionally, the court declined to award legal interest on the judgment sum, noting that interest typically applies to commercial, not employment disputes.
The employer had filed a counterclaim, which was partially upheld. The court ordered the claimant to repay Dh100,000 based on an admitted loan. However, other elements of the counterclaim were dismissed. The employer’s request to suspend the civil proceedings pending a criminal investigation into alleged forgery and breach of trust was also denied, with the court noting that the investigation remained in its preliminary stages.
The court announced the verdict in November 2024.
Tinani added that the ruling is seen as a milestone in the enforcement of end-of-service entitlements, particularly in cases involving long-term employment, and reinforces the UAE’s commitment to upholding employee rights under its labour regulations.
Source – https://www.khaleejtimes.com/uae/legal/employee-wins-end-of-service-compensation