Grounds for Termination of Labour contract without notice

Employees and employers are adequately protected by UAE labour laws, which have been in force for more than two decades and are regularly updated. However, serious violations of the rules will result in strict consequences.

The decision to terminate an employment contract is usually tough for both the employee and the employer, and it can be unpleasant for everyone concerned but it’s important that the termination of the employment contract is handled correctly and in accordance with existing UAE labour laws.

Both the employee and the employer have the right to terminate their employment contract without notice in the circumstances given below. 

Termination of Labour contract without notice by the employer

Following are the scenarios where the employer can terminate the employee without prior notice

1. If the employee uses a false identity or nationality, or if he submits fake documents or certifications.
2. Employee's physical assault on the employer or one of his co-workers while on the job.
3. An employer may dismiss an employee during or after the probation period, or when the employee makes a mistake that causes the employer a significant financial loss, as long as the employer reports the incident to the Ministry of Labor and Social Affairs within 48 hours.
4. Employee violates workplace safety guidelines, given that the guidelines were written down and placed in a prominent location, and that the employee was made aware of it.
5. An employee without a justifiable reason is absent for more than 20 days in a row or for more than 7 days in a row during a year.
6. An employee is found intoxicated or under the influence of illegal drugs during working hours.
7. Employee reveals a secret about the company for which he is working. The law does not define such secrets, but legal experts believe that it includes matters directly related to the company's statute or those that could harm the company's performance or interests inside or outside the UAE.
8. An employee is conclusively convicted by a court of a crime involving honour, honesty and public morals.

 Termination of contract without notice by the employee

An employee has the right to terminate an employment contract without giving notice in the following two circumstances-

1. If the employer has violated his legal or contractual duties towards the employee. For example, when an employer fails to pay wages to his employees for a period exceeding 60 days.
2. If the employee has filed a case against an employer who has failed to assure the worker's employment. For example, when a business shut down or if the business has been inactive for more than two months.

The important sections of Federal Law No. 8 of 1980, also known as the UAE Labor Law are related to the termination of both limited and unlimited term contracts.   

1. Limited-term contracts are contracts where a start and end date are provided for in the body of the contract up to a maximum period of 2 years.
2. Unlimited term contracts are open-ended contracts with no specified end date. 

Termination of Limited-Term contract

The contract is automatically terminated until both parties agree by mutual consent prior to the end date to either by signing a new contract or converting the contract to an unlimited term contract. As a result, notice procedures in a limited-term contract are uncommon.

Termination by employer

In the following two circumstances, the employer can terminate the employee from limited-term contract - 

1. As per Article 117 of the UAE labour law, an employer may terminate an employee with notice as per their contract (minimum of 30 days and maximum 3 months) for a valid reason. As the term valid reason is not defined under the law, any reason that is work-related which maybe, poor performance or misconduct.
2. If it can be shown that the employee violated one of the grounds given forth in Articles 120 and 88 of the UAE labour law which deals with acts or circumstances that amount to gross misconduct, the employer can end the contract before the expiry. 

Termination by employee

Under Article 121 of the UAE labour law, an employee may legally resign without notice if an employer fails to fulfil his duties towards an employee under the provisions of the employment contract, or if an employee is assaulted by the employer or the employer's legal representative.

Termination of Unlimited term contract

 Termination by Employer under unlimited term contract can take place under Article 117 and Article 88 and 120 of the UAE Labour Law and the termination by the employee can take place under Article121 of the UAE Labour Law

This article thus discusses the important provisions of UAE Labour Law to make the tedious process of termination without notice easier for both employer and employee.

For any enquiries or information, contact info@thelawreporters.com or call us on +971 52 644 3004