Any individual working in public or private sector in UAE might encounter termination in their working phase. Whether you are heading on to new working venture or is not satisfied with your job, you must know the termination of employment contract in UAE. fulfilling each requirement is mandatory with the formal attitude. This guides shed light on the complete information about this topic. Read along and discover the minute unavoidable detail for the seamless processing.
What is Termination of Employment?
When an employee’s employment is terminated, their working connection with their employer ends. Employees may leave their jobs willingly or unwillingly (employer fires employee). Terminations can occur by mutual consent as well as for legal grounds, such as poor performance or unemployment.
Types of Employment Contracts
Different employment contracts have different terms, lengths of service, benefits packages, and legal requirements. Below is a summary of some typical categories:
- Permanent Contract: Providing an endless length of employment, this is the most traditional kind of employment contract. Although it usually offers the best benefits and job stability, it may also have more stringent terms for termination.
- Fixed-Term Contract: This type of contract, which is frequently used for project work, seasonal needs, or temporary positions, sets a specific end date for employment. In contrast to permanent contracts, benefits and employment security are typically more constrained.
- Part-Time Contract: This type of agreement determines work for a predetermined amount of hours per week, which is fewer than a full-time plan. Benefits and entitlements may be divided according to the number of hours worked.
- Casual Contract: Temporary or irregular work is recruited on an as-needed basis for casual personnel. Usually, they don’t get any perks or guaranteed hours.
- Zero-Hour Contract: This unusual arrangement does not guarantee a minimum number of hours. If there are any shifts available, the employee is only pay for the hours they work.
- Independent Contractor Agreement: This is a formal contract between a business and a freelancer or independent contractor rather than an employment contract. Although the contractor performs services, they are not regarded as employees and are therefore in charge of their own taxes and benefits.
What Are the Criteria for Terminating an Employment Contract?
The criteria for terminating an employment contract rely on several factors, including:
- Type of Employment Contract:
- At-Will Employment: This is the most common type in many countries like the US. In at-will employment, either the employer or employee can terminate the contract at any time, with or without cause, as long as the reason isn’t discriminatory or illegal. However, notice periods are often customary (e.g., two weeks).
- Fixed-Term Contract: These contracts are valid for a specific period and end automatically on that date. Termination before the end date usually requires a valid reason and adherence to the contract’s terms.
- Contract with Specific Termination Clauses: These contracts outline specific reasons for termination, like misconduct or performance issues. Termination outside these reasons might require following a specific process or providing compensation.
- Local Labor Laws: Labor laws in each country dictate minimum requirements for termination, like notice periods or severance pay. These can’t be bypassed by an employment contract.
Legitimate Grounds for Termination
Legitimate grounds for termination of an employment contract can be broadly categorized into two main areas: For Cause and Without Cause (depending on the employment type).
For Cause refers to circumstances in which an employee’s performance or behavior warrant termination. These are a few typical explanations. This covers major transgressions against the firm’s policies, such as theft, assault, harassment, or persistent refusal to obey orders or utilize company property improperly. The worker continuously performs below expectations, even in the face of warnings or attempts to improve. This might have to do with output, fulfilling deadlines, or the caliber of the work. This entails negligence or irresponsibility that damages the business or endangers others.
The term “without cause” refers to circumstances in which an employee may be let go by their employer even in the absence of misconduct. This is more typical in At-Will employment arrangements, though, where any side may end the relationship for any reason as long as it’s not unlawful or discriminatory. Because of reorganizations, layoffs, or developments in technology, the corporation no longer requires the role. Financial challenges may force the organization to fire personnel.
Period of Notice for Termination
For employers and employees alike, it is essential to comprehend the notice period. It guarantees a more seamless transition, permits appropriate duty transfer, and reduces workplace disturbance. It describes the period of time that either the employer or the employee must provide before the employment contract expires. This time frame varies according to:
- Contractual Agreement: The particular conditions specified in the employment agreement frequently determine the necessary notice duration for each party.
- Law: Minimum notice periods for termination, particularly for permanent contracts, may be imposed by local labor regulations.
- Employee Seniority: Senior employees may be eligible for longer notice periods in certain businesses.
Certificate of Service
An employee receives a Certificate of Service from their employer after their job is terminated. It is sometimes referred to as a service letter or a termination certificate. It accomplishes multiple goals. It can include information about pay, perks, and any noteworthy accomplishments made over the course of employment.
This service certificate is issued by the employer to the employee who is ready to leave the company. He can then utilize it for his next employment.
Employment Termination by the Employee
An employee considers their decision to resign as the end of their employment. Different phrases are used depending on the situation:
Resignation is the most prevalent word used when an employee voluntarily leaves their position and gives notice to their employer. The notice time may vary based on the conditions of the employment contract, corporate policies, and local laws. It is required of you to be professional and give at least two weeks’ notice.
Resignation is a subset of “voluntary termination,” which also includes situations where a person leaves their job without providing notice or where their contract specifically allows it (e.g., a relocation clause).
Unexpected Contract Termination by Employee
For employers, an unexpected departure—also referred to as a resignation without cause—can be upsetting. While they search for replacements, it disrupts ongoing projects and may overburden remaining workers. Knowing why you left, whether it was due to unhappiness, a better job offer, or personal reasons, might be useful.
Non-National Employee Termination of Contract
Compared to local employees, terminating a non-national employee’s contract requires more consideration. Because their employment is linked to their work visa and legal residency status, losing their job may affect their eligibility to remain in the nation. In the event that the employer sponsors the visa, they may be required to assist the worker in relocating to a new position or possibly repatriate them. Non-national employees frequently have special considerations under employment contracts and local labor legislation. Certain termination agreements with varying notice periods, as well as obligations to offer severance pay or repatriation benefits, are examples of these.
Employment Termination by the Employer
Termination made by the employer
Unexpected Employment Termination by Employer
It might be shocking to be let go by your company without warning. This may be the result of a reorganisation within the company, a downturn in the economy, or even performance issues that they haven’t been transparent about.
Arbitrary Termination by Employer
When an employer fires a worker for a cause unrelated to their performance on the job or misbehavior, it’s known as an arbitrary termination. In nations where employment is at-will, where employers typically have broad termination rights, this is especially troubling. Nevertheless, termination for unlawful or discriminatory reasons is prohibited even in these settings.
Indefinite Contract Termination
Terminating an indefinite employment contract, also known as a permanent contract, requires following specific procedures compared to fixed-term contracts. Unless there’s a serious breach of contract, a notice period is usually required by law or by the contract itself. This gives both parties time to adjust.
Moreover, Employers might have more specific reasons outlined in the contract for immediate dismissal, like misconduct or severe performance issues. If the employer no longer needs the position, they may terminate for redundancy. But they may have specific procedures or severance packages required by law.
Conclusion
The legal system in the United Arab Emirates strikes a balance between the rights of employers and employees when employment contracts are terminated. It is imperative that both parties comprehend the terms of termination, notice periods, and the notion of arbitrary dismissal.
Workers who receive an unexpected termination should speak with a labor lawyer in the UAE to learn about their rights and possible remedies, especially if they believe the dismissal was made arbitrarily. To prevent legal issues, employers—especially those that hire foreign workers—should make sure they follow the correct processes specified in the employment contract and abide by UAE labor laws. Employers and employees can reduce possible disagreements and manage the termination process with clarity by adhering to these principles.
FAQs
What is a legitimate reason for termination in the UAE?
Employee misbehavior, subpar work, redundancy, or circumstances specified in the employment contract are all acceptable grounds for termination in the United Arab Emirates.
What are the four conditions for process termination?
A party may no longer be able to deliver on the contract – which in turn can give rise to rights to terminate the contract altogether.
- Termination by performance.
- Termination by Agreement.
- Termination for Breach of Contract.
- Termination by frustration.
What the difference is between terminated and fired?
The phrase “terminated” refers to the end of your employment in a more general sense. It could be as a result of your voluntary resignation or your dismissal from the company (involuntary termination).
A particular kind of involuntary termination known as “fired” occurs when your employer fires you because of misbehavior, performance problems, or organizational reorganization.
