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Is dismissal after the ‘best employee’ award considered arbitrary dismissal?

A reader wants to know the options available after the company delivered the letter citing “cost-cutting measure” as the cause.

Ask: This year I received two “best employee” awards from my company in Dubai. However, I was surprised when I received a termination letter last month. The letter states that it is a cost-cutting measure. Considering that I have exceeded all my goals and received company recognition for my work, will I have a strong case if I file for arbitrary termination?

Answer: According to your queries, it is assumed that you were working in mainland Dubai. It is assumed that your employer has terminated you serving a stipulated notice period as mentioned in your employer contract, and you are currently serving the notice period. Therefore, the provisions of Federal Decree-Law No. 33 of 2021 on the Regulation of Labor Relations and Cabinet Resolution No. 1 of 2022 on the Implementation of Federal Decree-Law No. 33 of 2021 on Regulation are applicable. of Labor Relations.

In the UAE, an employer can dismiss an employee by serving a stipulated notice period as mentioned in the employment contract. This is for Article 43 (1) of the Employment LawWhat states,

“Either party to an employment contract may terminate the contract for justified cause, notifying the other in writing. The employee must perform his or her duties during the notice period agreed in the contract, provided that the notice period is not less than to 30 (thirty) days and not exceeding 90 (ninety) days.”

However, an employer cannot fire an employee without a valid reason. If an employer terminates an employee’s employment without a valid reason, such termination may be considered arbitrary dismissal. This is in accordance with Article 47 of the Employment LawWhat states,

“1. The dismissal of a worker by his employer will be arbitrary if the worker presents a serious complaint to the Ministry or files a provenly valid action against the employer.

“2. The employer shall pay the employee the fair compensation estimated by the competent court if the dismissal is determined to be arbitrary in accordance with paragraph (1) above.

The amount of compensation will be determined based on the type of work, the extent of the damage suffered by the employee and the length of their service. In any case, the amount of compensation may not exceed (3) three months of the employee’s salary calculated on the basis of the last salary received by him.

3. The provisions of paragraph (2) above shall not prejudice the right of an employee to receive payment in lieu of notice and severance pay to which he is entitled under the provisions hereof.”

Based on the aforementioned legal provisions, the termination of your employment by your employer for cost-cutting reasons can be considered an arbitrary termination, since a mere unilateral decision by the employer that it is facing an economic crisis cannot be considered an arbitrary dismissal. valid reason for terminating an employee’s employment contract. However, if an employer faces a serious financial crisis, it may have to end its operations by obtaining an order from a local authority or court that has jurisdiction in the UAE and can terminate an employee’s employment contract. This is in accordance with Article 25 (1) (b) of Cabinet Resolution No. 1 of 2022read with Article 42 (8) of the Employment LawWhat states,

“Subject to the provisions of Federal Decree-Law No. 9 of 2016 on Commercial Bankruptcy, Federal Decree-Law No. 19 of 2019 on Insolvency and the provisions of subsection (8) of article 42 of the Decree Law:

1. The employment contract will be terminated by:

b) Issuance of a decision by the competent authorities to the effect that the businessman cannot continue his activity for exceptional economic reasons beyond his control.”

Therefore, if you believe that your employer has terminated your employment without a valid reason, you may consider filing an employment complaint with the Ministry of Human Resources and Emiratization (MoHRE) seek compensation for arbitrary dismissal along with other termination rights from your employer. Depending on your complaint to the MoHRE, the authority may try to resolve the dispute between you and your employer amicably. In case an amicable agreement is not reached with your employer before the MoHRE, based on the written observations of the authority, you can file an employment case against your employer before a court having jurisdiction in the emirate of Dubai.

News Source: Khaleej Times

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