I arrived from India on an employment visa in April of 2014 to take up a two-year contract. The company made huge promises during the recruitment process, but little of it is true and the working conditions are poor. I am a postgraduate in marketing from India. My query is if I leave the job within the contract period, what fine will I be required to pay? On my contract letter, it says I will have to pay the entire induction charges, while the labour ministry said I only have to pay one-and-a-half months' salary. The company only provided me with the visa and I have paid all other costs. Also, will I be eligible to join a new organisation? My current visa is on my graduation certificate, whereas I am a postgraduate. KV, Abu Dhabi
If someone agrees to work for a company on a fixed-term contract but wishes to leave before the end of the two-year period then they are liable to pay a penalty to the employer as per UAE Labour Law. Article 116 of UAE Labour Law states that “if the contract has been terminated on part of the employee … 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”. This is an amount equivalent to 45 days’ salary. It is against the law for an employer to demand repayment of any of the costs incurred in taking on an employee, no matter what a contract says. The Ministry of Labour is quite clear about the costs of visas, flights and labour and identity cards being borne by the employer. Finally anyone who leaves a job within the first two years will be subject to an employment ban of six months. Even for those with degrees and higher salaries, it is essential to work for a company for a full 12 months before leaving to avoid a ban. In this scenario, if KV leaves now he does not have to repay the company’s costs, but will be liable for the penalty for breaking the contract and would be subject to an employment ban.
Keren Bobker is an independent financial adviser with Holborn Assets in Dubai, with over 20 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. Readers are encouraged to seek appropriate independent legal advice
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