End of Service Gratuity under the UAE Labour Law: Time to be More Practical
Type
E-journal
Date
10 Apr 2012
Jurisdiction
United Arab Emirates
Taxonomy
Pay, Benefits & Tax, Rights & Duties of Employees & Employers, Termination of Employment, Contract & Conditions of Employment
Copyright
LexisNexis
Relevant company
Habib al Mulla & Partners
Legal reference
Federal Law No. 8/1980
Analysis
As the name implies, end of service gratuity is an amount of money that every employee is entitled to receive, and every employer is liable to pay, upon termination of an employment relationship in the UAE, provided that the employee meets the conditions set out in the Labour Law (UAE Federal Law No 8/1980). End of service gratuity forms part of the benefits an employee is entitled to upon termination of their employment contract
Under the Labour Law employees in the UAE are entitled to the following benefits upon termination:
- A notice period or payment due in lieu of the notice period where the contract for an unlimited period;
- Payments equivalent to accrued but unutilised leave or any part thereof;
- Payments for overtime or any wages due and not yet paid;
- End of service gratuity calculated on duration of employment;
- Where the contract of employment is for an unlimited period, compensation for unreasonable dismissal if the contract was terminated by the employer for unreasonable cause (generally to a maximum of three months);