The Sharjah company is behaving illegally, expert says
Can my former employer retain my passport after my visa is cancelled?
I have resigned from my employer, which is based in the Sharjah free zone, and received my cancellation papers but the company isn’t giving me my passport. They claim they are liable for it and will only give it to me at the airport if I leave. When I joined the company I was made to sign an agreement that said I cannot work for any other company in the same business for at least three years after I leave. I have a new job but in the same industry as I am a chemical engineer. The previous company doesn’t know about this but is saying that even though the visa is now cancelled I have to report to them daily and if I don't they will file an absconding case against me. What can I do? AI, Sharjah
This employer is being unreasonable and also acting illegally. There are several issues here. If an employment visa has been cancelled the employer is not responsible for the individual and they have no right to demand that someone reports to them after visa cancellation. They also have no right to retain an employee’s passport – at any time – and that is against the law for all UAE employers Once someone is no longer an employee, after resigning and working notice, a company cannot file an absconding case, so that is an empty threat. I strongly recommend AI contacts his local labour office or the Ministry of Human Resources and Emiratisation as he will need his passport to secure a new residency visa.
In respect of the non-compete clause, while these are permitted there are limits and the document signed, perhaps unsurprisingly, is unlikely to be upheld. Labour Law permits non-competition clauses to be included in a contract of employment as a way of protecting a business. While they are legitimate, such post-termination restrictions can be difficult to enforce. Article 127 of UAE Labour Law specifically states that where an employee performs a role that allows him to become familiar with confidential information, the employer may put in place an agreement with provisions that prevent an employee from working with a competing business after leaving service - but there are limitations. Any non-compete clauses must be reasonable and must only limit conduct in a way that is necessary to protect legitimate business and legal interests.
With this in mind the clauses must be limited in duration, geographical scope and the nature of the restriction. Restrictions of more than six months are unlikely to be upheld and the employer would have to prove that they have been disadvantaged in some way to make a monetary claim. A period of three years is excessive.
Any penalty can only be enforced by way of a court ruling and the employer would have to bear the cost of making a legal claim. This appears to be another empty threat from a company that is already acting unreasonably and does not have the law on its side.
Read more from Keren Bobker:
I run a small business with a few employees and need advice as one staff member is not being reliable. He has been late many times and has even left clients waiting because he hasn’t turned up. When I have called, he has been asleep. As the employer what can I do legally about the situation? He is on an unlimited contract and has been with us for just nine months. This situation is not acceptable, can you advise? HS, Dubai
In a situation where an employee fails to turn up to work or is persistently late without approval, the employer needs to go through a specific process. UAE Labour Law covers all non-national employees in the private sector, although the Dubai International Financial Centre has its own regulation, albeit they are broadly similar, and there may be some variations in free zones.
In accordance with Article 120 of UAE Labour Law, an employee can be dismissed without notice 'should the worker fail to perform his main duties in accordance with the employment contract, and fails to remedy such failure despite a written investigation on the matter and a warning that he will be dismissed in case of recidivism’. In this case, the term ‘recidivism’ refers to repeated or habitual undesirable behaviour. Note that the employee must first receive warnings that must be documented on their personal HR file. The first warning is usually a verbal warning but must still be noted and the employee must be made aware that they are receiving a warning and that continued poor behaviour will have consequences. Subsequent warnings should be in writing and again copies, signed by both the employer and the employee, should be kept on file. After this, if the behaviour continues the employer has grounds for dismissal.
The employee must be paid in full for time worked and any leave accrued and not taken, as well as any end of service gratuity to which they are entitled - as long as they have been in continuous service for one year or more.
Keren Bobker is an independent financial adviser and senior partner with Holborn Assets in Dubai, with over 25 years’ experience. Contact her at firstname.lastname@example.org. Follow her on Twitter at @FinancialUAE.
The advice provided in our columns does not constitute legal advice and is provided for information only.