About to leave your job in the UAE? You might be on the brink of missing out on a substantial end-of-service payout! The UAE’s labor law could mean thousands more in your pocket, but only if you know about it . This isn’t just about your last paycheck—it’s about ensuring you get every dirham you deserve. Read on to learn about End of Service Benefits and how consulting with top Dubai lawyers could be your smartest move yet.
End of Service Benefits for Full-Time Workers
Article 51 of the UAE Labour Law outlines the entitlements for end of service benefits for both national and foreign workers. Here’s a detailed breakdown:
For National Workers
National workers are entitled to end of service benefits according to the legislation regulating pensions and social securities in the UAE. These regulations ensure that national employees receive their due benefits as per the state’s pension and social security laws.
For Foreign Workers
Foreign workers who have completed one year or more in continuous service are entitled to end of service benefits. These benefits are calculated based on the worker’s basic wage and are structured as follows:
First Five Years of Service: 21 days of basic wage for each year.
After Five Years of Service: 30 days of basic wage for each additional year.
Foreign workers are also entitled to benefits for partial years worked, provided they have completed at least one year of continuous service. However, unpaid days of absence are excluded from the calculation of the service term.
Maximum Cap on Benefits
The total end of service benefits for foreign workers cannot exceed two years’ wage. This cap ensures that the benefits remain within reasonable limits while providing fair compensation.
Calculation of Benefits
Benefits are calculated based on the last basic wage the worker received. For those paid monthly, weekly, or daily, the calculation is straightforward. For piecework employees, the average daily wage is used. Employers are allowed to deduct any amounts payable under the law or a court judgment from the end of service benefits. This must be done in accordance with specific conditions and procedures outlined in the Implementing Regulation.
End of Service Benefits for Non-Full-Time Work Patterns
Article (52)
For workers engaged in non-full-time work patterns, the end of service benefits are regulated by the Implementing Regulation. This regulation aims to enhance the efficiency and attractiveness of the UAE labor market while balancing the interests of both parties in the employment contract.
Timely Payment of Workers Entitlements
Employers are required to pay all wages and entitlements to the worker within 14 days from the end of the contract term. This includes all dues stipulated in the UAE Labour Law, the employment contract, and any company by-laws.
Key Considerations for Employers and Employees
Understanding the legal framework for service benefits is crucial for both employers and employees. Here are some key points to consider:
For Employers
Compliance: Ensure all end of service benefits are calculated and paid according to the UAE Labour Law.
Record-Keeping: Maintain accurate records of employment terms, wages, and any unpaid absences.
Legal Deductions: Be aware of permissible deductions and ensure they comply with legal requirements.
For Employees
Know Your Rights: Understand your entitlements under the law and ensure you receive the correct benefits.
Service Term: Keep track of your continuous service period and any unpaid days that might affect your benefits.
Seek Legal Advice: If there are disputes or uncertainties, consulting a Dubai lawyer can provide clarity and help resolve issues.
Conclusion
End of service benefits are a vital aspect of employment in the UAE, providing financial security to employees at the end of their service. Understanding these benefits, how they are calculated, and the legal obligations of employers is crucial. Whether you are an employer or an employee, for personalized advice & guidance, reaching out to Dubai legal Consultants or Dubai lawyers can help you go through these regulations effectively.
