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| UAE Job Market |
Here's a breakdown of
contracts, clauses, and compliance when switching jobs in the UAE:
1. Types of Employment
Contracts:
- Limited-Term Contracts (Fixed-Term):
This is now the default for all private-sector jobs in the UAE.
- They have a clear start and end date.
- The maximum duration was previously 3
years, but this restriction has been eliminated, allowing parties to
agree on any duration.
- They must clearly define salary,
benefits, and responsibilities.
- Early termination typically requires a
written notice (minimum 30 days) and may involve compensation, depending
on the terms.
- Unlimited-Term Contracts (Open-Ended):
While these existed before, the law mandated a transition of all existing
unlimited-term contracts to limited-term contracts by mid-2025. New hires
generally operate under limited-term contracts.
2. Key Clauses and Compliance
when Switching Jobs:
- Notice Period:
- If you wish to terminate your contract
and switch jobs, you must adhere to the notice period stipulated in your
employment contract. This is typically 30 to 90 days, though a
shorter period can be agreed upon.
- During probation, if an employee wishes
to resign to leave the UAE, they must give 14 days' notice. If they
intend to join another UAE company during probation, they must provide a
minimum of one month's written notice.
- Non-Compete Clauses (Article 10 of UAE
Labour Law and Article 12 of Cabinet Decision No. 1 of 2022):
- Employers can include a non-compete
clause in the employment contract if the employee has access to business
secrets or is aware of the employer's clients.
- Validity Conditions:
For a non-compete clause to be legally enforceable, it must clearly
define:
- Geographical scope:
It cannot be overly broad (e.g., global).
- Time limit:
It cannot exceed two years from the date of contract expiry.
- Nature of work:
The restricted work must genuinely harm the legitimate interests of the
employer.
- When a non-compete clause may be void:
- If the employer terminates the contract
in violation of the law (e.g., arbitrary dismissal).
- If the contract is terminated during the
probationary period.
- For certain professional categories in
demand in the national labor market (as determined by the Minister).
- If the worker or new employer pays
compensation not exceeding three months of the worker's wage to the
previous employer, with their written consent.
- If the employer agrees to the switch to
a competing company despite a valid non-competition clause, it may be
considered a waiver of their right to enforce it.
- Probationary Period:
- The probation period cannot exceed six
months.
- If an employee resigns during probation
to join another company in the UAE, they must give at least one month's
written notice.
- If an employee resigns during probation
to leave the UAE, they must give 14 days' written notice.
- If the employer terminates during
probation, they must give 14 days' prior notice.
- The probation period counts as part of
the employee's service if they continue working after it.
- End-of-Service Gratuity:
- Employees who complete one year or more
of continuous service are entitled to gratuity upon termination.
- The calculation differs based on service
length:
- Less than 5 years:
21 days' basic salary for each year of service.
- 5 years or more:
30 days' basic salary for each year exceeding the first five years.
- The total gratuity should not exceed two
years' salary.
- MOHRE Approval and Registration:
- All employment contracts must be
registered with the Ministry of Human Resources and Emiratisation (MOHRE)
within 14 days of signing.
- Any changes to the contract (e.g.,
promotion, salary adjustment) must be agreed upon in writing by both
parties and updated with MOHRE.
- Labor Bans:
- The UAE Labour Law aims to ensure worker
mobility. However, certain circumstances might lead to a labor ban, such
as violating contract terms (e.g., not serving the notice period) or
specific legal issues.
- It's crucial to follow proper termination
procedures to avoid potential bans.
3. General UAE Labour Law
Information (Federal Decree-Law No. 33 of 2021 and its Executive Regulations):
The UAE Labour Law provides a
comprehensive framework for private sector employment, covering aspects such
as:
- Wages and Compensation:
While there's no universal minimum wage, salaries must be sufficient to
cover basic needs. Regulations cover overtime, bonuses, and timely payment
via the Wage Protection System (WPS).
- Working Hours and Leave:
Specifies maximum working hours, weekly rest, official holidays, and
various types of leave (annual, sick, maternity, parental, etc.).
- Employee Rights and Welfare:
- Protection against discrimination.
- Provisions for occupational health and
safety.
- Mandatory health insurance for employees
(employer's responsibility).
- Protection from forced labor.
- Right to retain personal documents
(passports).
- Termination of Employment:
Outlines valid reasons for termination, notice periods, and calculation of
end-of-service benefits.
- Dispute Resolution:
Provides a mechanism for resolving labor disputes, starting with MOHRE and
potentially escalating to the competent courts if an amicable settlement
is not reached. MOHRE also offers a free legal consultation service
(80084) in multiple languages.
- Work Models:
The law introduces various work models, including full-time, part-time,
temporary, and flexible work, to enhance market flexibility.
Official Sources for UAE
Labour Law:
For the most accurate and
up-to-date information, always refer to the official sources:
- Ministry of Human Resources &
Emiratisation (MOHRE): This is the primary government
authority for labor affairs in the UAE private sector. Their website
(www.mohre.gov.ae) provides access to Federal Decree-Law No. 33 of 2021
and its executive regulations, FAQs, and services for employees and
employers.
- UAE Legislation Portal:
(uaelegislation.gov.ae) This platform, managed by the General Secretariat
of the UAE Cabinet, serves as a unified and updated destination for all
in-force legislations in the UAE.
Important Note: While
this provides a general overview, specific situations can be complex. It is
highly advisable to seek legal counsel from a qualified labor lawyer in the UAE
for personalized advice regarding your specific contract, clauses, and
circumstances when considering a job switch.
