The UAE Labour Law, Federal Law no. 8 of 1980, admits that there are some instances where employees are fired unfairly. This despite the fact that employers generally have the right to do so. If an employee can demonstrate sufficiently that their dismissal was actually unfair, they may be eligible for compensation under the Article 123 of the UAE Labour Law.
In this article, we will be talking about gratuity after unfair dismissal. The UAE Labour Law has provisions that distinctly describe an employee’s rights. In addition, it provides legal biding for gratuity when unfair dismissal happens. The clause that touches on this particular case is the Article 123 of UAE Labour Law.
The UAE Labor Law, commonly known as the Federal Law No. 8 of 1980, governs private enterprises in the UAE. This is the fundamental laws controlling employment-related matters in the country. The Labor Law governs any potential problems between the business and the employee.
The labor standards in the UAE are particularly favorable to workers. An employer would commit arbitrary dismissal if they dismissed an employee without giving them with a cautionary letter or notice, or if they forced them to leave for no reason. Under UAE Labour Law Article 122, a worker’s dismissal by their boss for reasons irrelevant to their job constitutes “arbitrary termination.” Nevertheless, what is important here is what Article 123 of the Labour Law has to say about this issue.
If arbitrary dismissal turns out to exist, the Court may require the employer to provide further compensation to the employee. This, under Article 123 UAE Labour Law.
UAE Labour Law Gratuity Article 123: What you need to know
Article 123 UAE Labour Law 2022 states that if an employee gets fired or let go for arbitrary grounds, the employer has to compensate the employee. The following elements will be considered by the court according to the Labour Law Article 123 when determining the amount of compensation:
- Type of work.
- The magnitude of the employee’s losses or damages.
- The length of the employment cycle.
- Investigation done into the working environment.
However, depending on the employee’s latest due salary, the compensation cannot go above the employee’s income. This for a duration of three (3) months according to the UAE Labor Law Article 123. Along with the salary due to the employee, it must also contain the employee’s right to gratuities.
As long as the termination goes according to legitimate and justifiable factors, such as:
- Poor performance.
- Ongoing medical conditions.
- Economic crisis, among others.
It will not constitute an unfair dismissal of the employee under the provisions of the Labor Law (UAE Labour Law Article 123 and Article 122). Moreover, the employer has the right to fire an employee completely under Article 88 uae Labour law and 120.
If an employee decides that their dismissal was based on arbitrary grounds and as a result violates the law, they always have the option of approaching the MOHRE and filing a lawsuit. From the date that their employment visa was cancelled, dismissed employees have the right to an extension of thirty days. During this extension, they can either obtain a new resident visa or depart the United Arab Emirates.
Visit our insights section to learn more about the employment regulations in the United Arab Emirates. Moreover, if you need support on Article 123 Labour Law, you can contact a legal advisor.