Employment Law

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There are numerous people around the globe who are unaware of the regulations and laws of the countries they are living in. Practically, the labor law is the foundation of laws, precedents and administrative regulations which addresses the lawful privileges of, and binds individuals who are working in companies. This research will highlight different conceptions which pertains to employment law in certain aspects and in general in UAE like, the ILO, MOL, the employment agreement, Probation Periods, wages, Disciplinary Code and Termination of Contract.

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Internal labor organization

For laws relating to labor, it is of paramount importance to mention the body ILO commonly known as the international organization accountable for drawing overlooking and drawing up the international standards. Additionally, the aim of ILO is to make sure that it serves the needs and wants of individuals who are working by merging the government together, employers and workers to set labor standards, develop policies, and devise programs.

The Ministry of Labor

This specific body regulates all issues that pertain to work. It is accountable for allotting work permits or labor cards and imposing prohibitions on those are punishable in one way or the other. Their aim is to manage and organize the labor market to build up participation of the fellow Emiratis working in the workforce, understand the fortification and flexibility in the labor market, and entice other skilled workers through an inclusive system of rules and strategies and policies, enforcement, institutional partnership and effective service delivery.

To who does the law applied?

The law is binding for all the staff and employees working in the organization in UAE. However, there are specific groups of individuals who are relieved from this law, which are:

  • Employees that are from the Federal government and governmental departments of the Emirates, employees of municipalities, other employees of federal and local public authorities and corporations, as well as employees who are recruited against federal and local governmental projects.
  • Members of the armed forces, police and security.
  • Domestic Servants employed in private households.
  • Farming and grazing workers.

Additionally, a potential partner in a business arrangement does not comes in the criteria of an employee and is therefore not obliged to acquire a labor card from the UAE MOL. However, if the partner holds and employee spot added to his partner rank, he will be treated as an employee for the work he is doing in the corporation.

The employment contract

Usually, a written lawful document represents an employment contract that lists out the binding terms and conditions of employment that exists between the employer and the employee. It is written in most regularly for jobs in higher positions and senior employees because they have a lot of consequences attached to their employment if the relation among employee and employer does not work out as planned. There exist two categories of an employment contract:

  • Limited employment contracts or fixed term contracts: are contracts for a particular duration.
  • Unlimited employment contracts: are contracts where an employee remains to work for an employer for a limitless duration, unless the employment contract is dismissed.

The features of a limited or a fixed term contract:

  • It has a beginning and end date.
  • Terms of such a contract cannot be in surplus of duration of 4 years. It can however be reintroduced on joint agreement for an analogous or lesser duration of time.
  • The employment will be dismissed at the after the completion of the time duration agreed.
  • If the employer dismisses the contract for any reason other than those stated in Article 120, he would be accountable to pay reimbursement to the employee. This reimbursement shall be determined on the foundation of the wages due for duration of three months or for the continuing duration of the contract whichever is less, unless an article in the contract indicates otherwise otherwise.
  • If the contract is negated by the employee for reasons other than those agreed in Article 121, he will be accountable to recompense the employer against any loss subsequent from its termination. The amount of reimbursement shall be calculated on the basis of half-a-month’s wages for three months or for the continuing time duration of the contract whichever is less, unless the contract indicates or else.

The contents of an unlimited term contract:

  • The contract will have a beginning date but will have no such end date i.e. the date on which the contract will be considered as terminated or ended, it’s known to be an open-ended contract.
  • A contract will be known to be “unlimited” if it is an verbal contract or if it is not for a stated duration of time or it had been for a certain duration of time and the related parties remain to act on its conditions and terms after the expiration moment, without any written contract stipulating the ending date, or if the objective of the employment is to complete the work not projected within a quantified time-span or which is by very nature cannot be renewed.
  • The contract may be dismissed on a joint arrangement by either of the related parties to the contract by giving the other party a 30 days’ notice period of dissolution.
  • The contract may be dismissed for a vindicated reason at any time on giving 30 days’ notice period of dissolution by either party to the other. The notice duration of time may be less for an employee who is in an organization and working on daily basis.
  • The notice duration of time may be protracted for duration more than 30 days. It would then not be adequate for the parties to relinquish this notice duration of time.
  • The employees’ wages during the notice duration of time should be paid in full for the complete notice duration served.
  • In the case of an event pertains to, that no notice had been given, the individual who should have given the notice must pay damages the other with the payment of a month’s wage in lieu of the notice duration of time.
  • In accordance with the Article 120, the employer may dismiss the employee’s contract without issuing notice duration of time.
  • The employee may dismiss the employment contract without issuing the notice duration of time as per the Article 121.
  • The employee will be eligible to the reimbursement if the dissolution of the contract had been for an unfair cause. The court may reward the employee damages, against the employer, only if that the rewards so awarded does not surpass three months wages of the employee (calculation to be founded on the last wage paid to the employee).
  • The reimbursement for compensations if any, granted to the employee for irrational firing, will be without preconception to the employee’s privilege of end-of-service perquisite and payments in lieu of notice, if notice had not been appropriately granted.

Information that are significant in an employment contract

The information that form the basis of an employment contract and are crucially required are, wages/remuneration payable, date of the employment contract, date of the beginning of the employment contract, nature of the contract (Limited/Unlimited), nature of the work, time duration of the contract (For limited term contracts) and the location of employment.

Probation Periods

  • In a workplace environment, probation is a recognition that delivered to those employees who are fresh to join the organization or a company. It is commonly known as Probation Period around the world of a working individual. This specific recognition permits a supervisor or the business manager to closely asses the performance of the newly joined employee in terms of skills and other relevant areas. A probationary period differs broadly relying on the type or nature of the company, but generally lasts anywhere from 30 to 90 days.
  • In accordance with the UAW Probationary period, it is a specific duration of time in which the employer assesses the employees and if not satisfied, she/he has the authority to toss them out. As per the Article 37 of the UAE Labour Law says “An employee may be engaged on trial for a period not more than six months, during which the employer without notice or compensation pay may dismiss his services. An employee shall not be positioned on trial more than once with the same employer. Where an employee effectively finishes the period of trial and remains in employment, the stated period shall be considered as part of his duration of service.”
  • Maximum duration of the trial period or probation is six months. Three months is considered to be a common period of time in the UAE.
  • The UAE Labour Law does not relate to employees of the Federal Government, Municipalities, other federal or local authorities, “employees recruited against federal and local governmental projects”, Armed Forces, Police and Security Forces. Nor to domestic workers, or some farming workers. So probationary periods might be longer for workers recruited into those areas.


In accordance to the employment law in UAE, wages has been explained as the remuneration paid to the employees for the services they render to an organization according to the employment contract, they can be cash or bank transfers etc.; annually, monthly, weekly, daily, hourly, on a piece-rate, productivity linked. Wage comprises of all kinds of cost that pertains to living allowances, incentives related to honestly or loyalty of the employee, provided that these rewards are particularly stated in the employment contract signed by the parties involved or in the formation’s core rubrics and rules, have become habitual or if the employees of that formation have come to concern such enticements as part of the wages as contrasting to a donation”. Basic wage is a particular benchmark wage which is stated in the labor contract and as consented by the parties involved for the terms and conditions of the contract. Allowances costs and other incentives however do not form the part of basic wage. Therefore, accommodation, housing, transport and travel allowances will not be included in the basic wage. Basic wage is vital in the assessment of end-of-service gratuity, which is based on the foundation of the last drawn basic wage and not on the foundation of that totality of the wages. Even in this assessment, allowance does not form a part. The currency of the wages being paid differs as it can be Dirhams in UAE or any suitable currency. However, the parties may consent the currency to be paid in the employment contract. No such restrictions are imposed by any regulatory authorities. Case: Does the law need any proof or evidence of payment on wages? In the event of any kind of conflict or dispute, it would be important for the employer to prove that the employee had been paid his wages regularly in addition with any such allowances applicable. Such proof must be in writing. However, equal rights are given to the employee to prove any sort of non-payment by the employer within the law frame stated in the employment contract. So, it is of crucial importance that employer sustain adequate records of the transactions and payroll.

Disciplinary Code

A disciplinary code in UAE presides for the provision of disciplinary measures which any employer or his representative may grant on his employees. There are listed as follows:

  • Warnings
  • Fines
  • Deferment from work with a reduction in wages for not more than 10 days of duration.
  • The deterrence of periodical payments or the deferment of in formations where such payments exists.
  • The deficiency of preferment in formations where elevations exist.
  • Dissolution of service without preconception to the compensation of all ends of service remunerations.
  • Dissolution of service and the penalization of all or some of his privilege. This chastisement shall not be levied for any reason other than those mentioned in Article 120 of this law.

A fine can be a fixed amount or some amount equal to the employee’s wage for certain duration of time. However, the optimum level of fine an employer can impose on his fellow employee should not exceed 5 days wages, and indeed in any month total fines shall not exceed an amount equivalent to 5 day’s wages. Case: If a fine is imposed, who should be in charge of keeping the money deducted from the employee’s wages? A fine imposed on an employee is supposed to be entered in a specific register stating the cause or the events, name of the employee and his basic wage level. A specific account should be maintained for these fines, the monthly total of which should be spent on things like social welfare and the betterment of work environment. The employer may not levy any punitive procedures on the employee unless the following conditions take place:

  • No punitive action should be taken against any employee because of something he committed who is out of the scope of the workplace unless it is related to work, the employer or the manager in charge of the work.
  • Only one punishment should be forced for one violation of any rule or regulation. A punitive retribution shall not be escorted with presumption of part of the employee’s wages.
  • None of the retribution on condition that for denoted to here above shall be forced on an employee unless he is knowledgeable of his desecration in writing and given a chance to protect himself. His declaration and resistance shall be noted and written in his file, and the retribution imposed shall be predicted out at the end of the stated note.
  • An employee must be knowledgeable in writing of the retribution forced on him, affirming its type and amount, the cause thereof and the retribution he shall be subject to in case of repetition.
  • No employee shall be blamed of a violation after the duration of 30 days of its detection. No punitive action shall be forced after the duration of 60 days from the end of exploration regarding the violation, and the validation of its recurrence.

Termination of contract

The contract of employment may be dismissed or terminated if both the related parties consent to it, provided that there is sufficient evidence in the writing of employee getting terminated. It may also be dismissed in the case of the death of the employee or his complete disability of working provided that a valid medical certificate has been given to the organization or the employer. However, if the disability of the employee’s is partial and he can do some other work and provided that his health state allows him to work in such conditions, it is the duty and the responsibility of the employer to shift and accommodate the employee the work suited for him in such events. An employer may discharge an employee without giving any notice in any of the following cases (Article 120 of the law):

  1. If the employee undertakes a character or a nationality other than his own, or has succumbed false documentations or credentials.
  2. If the employee obligates a fault instigating the employer a considerable financial loss, provided that the employer notifies the Ministry in authority within the duration 48 hours.
  3. If the employee be unsuccessful to carry out his rudimentary responsibilities as specified in the contract and stays to do so regardless of of a clear cautionary that his service will be dismissed if he recaps his misconduct.
  4. If he reveals a top-secret of the formation for whom he is working.
  5. If he is found drunk or befuddled by drugs during working hours.
  6. If he becomes inattentive without a genuine reason for more than 20 sporadic days or more than seven incessant days within one year.

An employee may dismiss his contract of employment without giving any notice in either of the following cases in accordance with Article 121 of the law: 1-If the employer has not content his responsibility headed for the employee as providing in the contract or by regulation, for example, when an employer does not pay an employee his wage on time. 2-If he is attacked by the employer or his lawful illustrative.

End of service gratuity

If the employee has completed his service of one or more year he will be entitled for the end of service gratuity for each of the first five years to come and 30 days per year after that. It is assessed on the basis of the last basic salary of his service. The total end of service gratuity, however, cannot exceed the cumulative salary of two years. The time duration of owing leaves are not comprised within the service duration of time. If an employeeis demised, the end of service gratuity goes to those who inherit them. Only UAE nationals are permitted for the end of service gratuity for the duration of time before the issuance of the Federal Labor Law in 1980 An employer should give his employee at his demand at the end of the contract a service credential free of charge, affirming the date of beginning of service, the expiration date, total service duration of time served the organization or the company, nature of work carried out by the employee, his last wage and any allowances, if they exist. The employer shall also return to the employee all that he has deposited with him like certificates, papers, instruments etc.


However, the conclusion can be in this way that there are a total of two employment contracts which we have mentioned above and each of those contracts have their own kinds of characteristics. Additionally, the termination can be in distinct way with any rules provided in the contract.


  1.  https://en.wikipedia.org/wiki/Probation_(workplace)
  2. https://www.dubaifaqs.com/probation-period-uae.php 
  3. https://en.wikipedia.org/wiki/Minimum_wage 
  4. https://www.angelfire.com/nv/sabu/UAE Labour Law.html
  5. https://www.deg.gov.ae/sitecollectionimages/content/pubdocs/uae_labour_law_eng.pdf
  6. https://www.ilo.org/global/about-the-ilo/lang–en/index.htm
  7. https://www.mol.gov.ae/english/newIndex.aspx#
  8. https://www.abudhabi.ae/egovPoolPortal_WAR/appmanager/ADeGP/Citizen?_nfpb=true&_ page Label=p20160&lang=en&did=20176
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Employment Law. (2017, Jun 26). Retrieved December 1, 2022 , from

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