I have worked for a private company for the last eight years, but I am going to resign as I have another job. During the period I have been with my current company, my salary was increased four times, but I did not receive a new contract or anything in writing. My bank statement shows the actual salary that I have been paid, even though official paperwork is unchanged. Could you advise whether my gratuity is calculated based on my initial basic salary at the time of joining as per the official contract? I am also owed annual leave of 42 days. Will the company also have to pay me this? NP, Abu Dhabi
UAE Labour Law is very clear that the end of service gratuity payment is based in the individual’s salary at the time they leave. Article 134 states “the end of service gratuity shall be computed on the basis of last wage which the employee was entitled to, in respect of those drawing their salary per month, week or day ”. In this case it does not matter that the contract has not been updated as the company will have records to this effect and Mr P will have bank statements showing the amount received every month. If an employee has accrued days of holiday and not taken them, then payment in lieu should be made as part of the final payment.
Keren Bobker is an independent financial adviser with Holborn Assets in Dubai, with over 20 years of experience. Contact her at keren@holbornassets.com Follow her on Twitter at @FinancialUAE
