Abu Dhabi, UAETuesday 24 November 2020

'My employer cut my salary because of Covid-19 without telling me'

The company illegally reduced the employee's salary by Dh1,000, leaving him without enough to live on

A UAE resident was not notified by his company that his salary would be reduced because of Covid-19. Silvia Razgova / The National
A UAE resident was not notified by his company that his salary would be reduced because of Covid-19. Silvia Razgova / The National

Since October 2018, I have been paid Dh3,000 each month – Dh1,500 is my basic salary and Dh1,500 is paid as allowances. In May, the company’s management decided to reduce my total salary to Dh2,000 without notice. When I called the accounts department to say they had underpaid me, I was told it was a directive from management due to Covid-19. I then called a director at my company and said I did not see why I should have my salary cut as I am still working eight hours each day, sometimes more. But he just said that I had to understand the present situation. I can’t live on this amount of money and it is not fair. What can I do? SA, Dubai

No employer is permitted to reduce a salary in this way. In an effort to help private companies deal with the effects of coronavirus on their businesses, the Ministry of Human Resources and Emiratisation (MoHRE) in March published “Ministerial Resolution No.279 of 2020”, which states that if an employer is adversely affected by Covid-19, they can take certain steps to reduce their costs. However, the employer must discuss the decision with the employee, who has to also agree to the reduced salary.

Under the resolution, there is a process that employers should follow. These are: 1. Implement the remote working system. 2. Give the worker a paid leave. 3. Give the worker an unpaid leave. 4. Reduce the worker’s wage on a temporary basis during the said period. 5. Reduce the worker’s wage permanently.

On the assumption the first three are not viable, a salary reduction can be implemented but it cannot be done without mutual agreement and the employee must also sign paperwork attesting to this.

Article 6 of the Resolution goes on to say: “If the establishment wishes to reduce the wage of the non-national worker permanently, it shall apply for a “work contract details amendment” service to obtain the ministry’s approval, according to applicable procedures”. This is in reference to a permanent salary reduction. There is not a lot of detail here but "applicable procedures" refers to a new contract that must be lodged with MoHRE and approval must be obtained before that can happen.

The expectation is that the employee has agreed to the reduction in salary before it is implemented. The guidance is clear that this must be by agreement of both parties, employer and employee.

I suggest SA contacts MoHRE as it appears the employer has acted illegally in reducing his salary without his agreement. The contact number for MoHRE is 800 60 and there is also an online chat function on its website at mohre.gov.ae

I was terminated from my job but my boss wants to use my ignorance of the law not to pay me. I did not receive any holiday pay or gratuity and they didn’t give me notice. What am I entitled to? I worked for the company for six weeks. DH, Ras al Khaimah

DH was on probation and so no notice of termination was required as set out in Article 37 of UAE Labour Law, which states: “The worker may be employed for a probation period not exceeding six months where the employer may terminate the services of the worker without notification or end of service gratuity.” No end of service gratuity was due as employees must work a minimum of 12 months to be eligible.

In this situation, DH must be paid for the number of days he worked and also for annual leave days that have accrued. This is likely to be two days, so this should be added to the salary as a final settlement.

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: August 1, 2020 09:41 AM

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