Question: I have been with my current company for more than two years. My position is being made redundant as the company is partially relocating abroad. They have offered me a three-month notice period and full settlement, which is fair, but I believe I can still claim for being made unemployed. My friend says everyone has a policy that pays out extra and I can also get more from the company.
What am I entitled to and can I make claims? CK, Abu Dhabi
Answer: There are various reasons why employment can be legally terminated in the UAE. Company restructuring and downsizing is one of them.
The provisions are set out in Article 43 of the UAE Labour Law. It states: “Either party to the employment contract may terminate the contract for any legitimate reason, provided that the other party is notified in writing and work shall be performed during the notice period agreed upon in the contract, provided that such period is not less than (30) thirty days and not more than (90) ninety days."
CK’s contract of employment refers to a notice period of 90 days.
The law goes on to say the "worker shall be entitled to his full wage for that period according to the last wage he was obtaining and he shall work during that period if the employer requests the same”.
All seems correct under the law and CK will continue working and being paid until her final day. She will also continue to accrue leave and should be paid in lieu for any unpaid leave as part of the final settlement, along with her end of service gratuity.
As this termination is in line with the law and payment is to be made in full, there is no entitlement to any additional payment.
The Involuntary Loss of Employment scheme came into effect at the start of 2023. All employees should have registered and joined by October 1 that year. It is applicable to just about all employees in the UAE.
The responsibility for joining lies with the employee. They need to pay the premiums and it is mandatory to subscribe.
The initiative provides a monthly cash benefit of up to 60 per cent of a person's basic salary for up to three months, if they are let go owing to non-disciplinary reasons and are without a job.
They can make a claim through official channels – assuming they have taken out this insurance. Everyone should have by now and if an eligible employee fails to subscribe, they can be personally fined. The fine is set at Dh400 ($108).
This is significantly more than is payable in premiums, so it seems pointless to defer signing up. Premiums are just Dh5 a month for employees with a basic salary of up to Dh16,000 and Dh10 a month for those with a higher basic salary.
The employee must be in the scheme for 12 months before a claim for payment can be made. Benefits can be paid for up to three months, subject to policy terms and conditions.
For anyone who has not yet applied, or who needs to make a claim, you do so here.
Q: I have been in Dubai for 30 years but worked in the UK for about 10 years before moving here. I remember having a UK pension with the companies I worked for, but I now cannot find any details. The two companies were not big and neither exists any more.
I hope to retire at the end of the year so am trying to find all information on what I have in terms of a pension. Can you help? Am I likely to have lost the pension money after all this time? SM, Dubai
A: Any money in a UK pension plan should not disappear but if there has been no contact for many years, and details have not been kept up to date, it can present a bit of a challenge.
Anyone who has a preserved pension, or any savings or investments, should ensure their contact details are kept up to date so they can always find and manage their assets.
The names of companies change, they get taken over, but money doesn’t just disappear. The trustees of pension schemes have a legal duty to provide information but employees have a responsibility to provide contact details.
If SM was in a company scheme and an old employer became insolvent, the pension scheme could have been taken over by the Pension Protection Fund, to be run by this body. Schemes are listed on their website.
If it was a personal pension, SM may need to check if the insurance company now has a different name. There have been mergers over the past 30 years. This can be checked with the Association of British Insurers.
The UK government has a Pension Tracing Service that requires the name of an employer or pension scheme. These should be on old correspondence.
Once a scheme has been traced, these days, with email and the ability to access information online, it should be easier to keep up to date.
Contact Keren Bobker at keren@holbornassets.com or www.financialuae.com. The advice provided in our columns does not constitute legal advice and is provided for information only
