Abu Dhabi, UAETuesday 20 October 2020

‘Can I sue my employer for early termination of my work contract?’

The company has also delayed repatriation by four months and refuses to pay the employee’s rent and bills

If an employer in the UAE breaks the terms of a fixed-term contract, they are liable to pay a penalty to the employee concerned. Getty Images
If an employer in the UAE breaks the terms of a fixed-term contract, they are liable to pay a penalty to the employee concerned. Getty Images

My company terminated my one-year contract after 10 months and didn’t repatriate me for four months. They also refused to pay my house rent and bills. Do I have a case against them in court? My contract stated that they are supposed to pay for my accommodation but they only paid until the month of termination. Now, they have agreed to pay for my flight ticket but aren’t willing to reimburse my accommodation costs. FD, Dubai

There are a number of issues to be considered here. As the employer broke the terms of the fixed-term contract, they are liable to pay a penalty to the employee. This is in accordance with Article 115 of the UAE Labour Law, which states: “Should the employment contract be of a determined term, and the employer rescind the same … he shall be bound to compensate the worker for the damage incurred thereto, provided that the compensation amount does not exceed in any case the total wage due for the period of three months or for the remaining period of the contract, whichever is shorter, unless otherwise stipulated in the contract.”

This means that FD is due for compensation from the employer as their service was terminated with two months left on the contract.

It is my understanding that a housing allowance was paid, rather than accommodation being provided. Ordinarily, this would form part of the salary package and would cease upon termination of the contract. However, things are different this year following the issue of Ministerial Resolution 279 in March to help businesses deal with the financial impact of Covid-19.

This set out legal steps for employers to reduce salaries or terminate employment, but also put in place protections for employees. Article 3 of the legislation made it clear that employers would remain liable for housing costs and other entitlements, except for the basic salary, for employees who were made redundant until they could either leave the UAE, join another company or the UAE government revokes these precautionary measures.

The employer is liable for repatriation costs of an employee who they terminate if the latter wishes to return to their home country. This is covered in Article 131 of the UAE Labour Law: “The employer shall, upon the termination of the contract, bear the expenses of repatriation of the worker to the location from which he is hired, or to any other location agreed upon between the parties. Should the worker, upon the termination of the contract, be employed by another employer, the latter shall be liable for the repatriation expenses of the worker upon the end of his service.”

This is being paid but it appears that the employer owes money to cover the employee's rental expenses for a period of time and compensation for early termination. I am aware that the courts have been supportive in cases like this where an employer has not paid for housing when they should have, but I would not expect the employer to be liable for utilities or other bills. In this situation, FD can file a case against the employer with the Ministry of Human Resources and Emiratisation.

Does a blog or writing on cooking and lifestyle subjects need any form of business licensing? While an e-commerce licence is clearly required for those who sell products on their blogs, is this required if you make money only by linking to adverts? Should I get an influencer licence? I have been thinking of starting a blog but want to be clear about the licence procedures. FS, Abu Dhabi

Since most blogs and social media accounts are a hobby with no monetary gain, no licence is required

Keren Bobker

To conduct any type of business activity, a licence is required in the UAE. While no licence is required to just write a blog, it is worth noting that as soon as any money is made, it becomes a business activity and that’s when a blogger must apply for a licence. The rules in relation to blogging, running websites and being a blogger were tightened in 2018. The National Media Council has made it clear that everyone needs to be properly licensed for all types of business.

The regulations require anyone conducting any commercial activity through social media to register for an e-media licence, as well as have a suitable trade licence. The rules apply to anyone who is paid for endorsements. This is a broad term but it applies to all hosted adverts as well as posts. The regulation applies where money changes hands or a payment is made. Since most blogs and social media accounts are a hobby with no monetary gain, no licence is required.

I recommend anyone wanting to monetise a blog, social media account or website to take advice from a business licensing firm to ensure that they are operating legally.

Keren Bobker is an independent financial adviser and senior partner with Holborn Assets in Dubai, with more than 25 years’ experience. Contact her at keren@holbornassets.com. Follow her on Twitter at @FinancialUAE

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

Updated: October 16, 2020 10:48 AM

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