Consequences of UAE expat resigning from overseas with rent allowance outstanding

Keren Bobker advises a worker who returned home and intends on repaying the money owed to the company.

Keren Bobker advises a worker who left the UAE without repaying a company housing allowance. Pictured, Downtown Dubai. Sarah Dea / The National

I joined a new company on an unlimited contract in January this year. In June I went to my home country for emergency leave because my mother was ill. Her condition deteriorated and I could not return, so I submitted my resignation from overseas. I was receiving a rent allowance six months in advance and now the company is asking for the money back, otherwise legal action will be taken against me. I don't have the money, as I spent it on my mother. I intend to pay it but don't have it right now. What should I do? ZA, Pakistan

As the rent allowance was paid in advance, any amount that is not applicable to the time of service should legally be repaid, as it was paid by the employer in good faith for a specific reason. This is entirely different to a company asking for their costs in employing someone to be repaid. The company has limited options in the action they can take, as ZA is not in the UAE. However, they will have records of monies paid and owed and could request that a police case be registered, which would prevent ZA from re-entering the UAE without being arrested. I suggest that he contact the company and agree a plan to repay the monies that are owed, even if this is over a few months. A dialogue should prevent any legal action being taken and will be beneficial to both parties.

Keren Bobker is an independent financial adviser with Holborn Assets in Dubai, with over 20 years’ experience. Contact her at [e-mail]. Follow her on Twitter at @FinancialUAE

The advice provided in our columns does not constitute legal advice and is provided for information only