Termination of Employment Contracts in the UAE

Analysis

Employment relationships in the United Arab Emirates are governed by Federal Law No 8/1980 Regulating Labour Relations as amended by Federal Law No 24/1981, Federal Law No 15/1985 and Federal Law No 12/1986 (the Labour Law).

The Labour Law provides that an employment contract can be terminated in the following ways.

- By mutual consent of both parties, provided that the employee's consent is given in writing;

- On expiry of the period specified in the contract, unless the contract is expressly or implicitly extended in accordance with the provisions of the law; and

- At the option of either party in unlimited contracts provided that the provisions of the Labour Law regarding notice period and acceptable causes for termination of the contract without abuse are fully complied with.

In addition, the employer can terminate the employment contract without notice and without any severance pay in the event that grounds exist on the basis of the employee's conduct under Article 120 of the Labour Law.  Grounds available under Article 120 are: