Consequences of resigning early still applicable

If an employee breaks the terms of a fixed-term contract they have to suffer the consequences.

I have been working in Dubai for 15 months and am on a limited contract. My resignation letter was accepted by my employer and I gave my 30 days’ notice. Do I still have to pay 45 days of my salary? Am I still entitled to my annual leave pay because I didn’t have a chance to use it? And also am I entitled to my other benefits such as airfare and sick leave pay? AY, Dubai.

If an employee breaks the terms of a fixed-term contract they have to suffer the consequences. Article 116 of UAE Labour Law states that “the employee becomes liable for compensating the employer against losses incurred by him in consequence of contract termination, provided that the amount of compensation, may not exceed half a month’s pay for a period of three months or for the remaining period of contract, whichever is shorter, unless the terms of the contract provide otherwise”. Half a month’s pay for three months is roughly equivalent to 45 days pay. Any accrued annual leave must be paid by the employer, as must sick pay, in accordance with the law. If an annual flight is part of the contract of employment whether anything is payable will depends on the exact terms in the contract, but if an employee will be leaving the UAE to return to their home country it is the employer’s responsibility to pay for that return flight.

Keren Bobker is an independent financial adviser with Holborn Assets in Dubai, with over 20 years of experience. Contact her at keren@holbornassets.com. Follow her on Twitter at @FinancialUAE

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Published: December 26, 2014 04:00 AM

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