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Abu Dhabi, UAESunday 16 December 2018

'Is my Dubai employer allowed to scrap the flight allowance?'

Since signing a new contract, the security guard's company has changed its policy on paying a ticket allowance

The security guard wants to know if it is lawful to change the terms of his contract relating to his ticket allowance. Photo: The National
The security guard wants to know if it is lawful to change the terms of his contract relating to his ticket allowance. Photo: The National

I am on a limited contract, working as a security guard. I finished my two-year contract, submitted my holiday form and like my colleagues went away. We were paid our ticket money but now our company is telling us it has scrapped ticket money. My question is whether it is lawful for the company to deny us this money if the decision to scrap it took place after my contract of two years was renewed? BB, Dubai

There are two parts to this as there are the standard clauses in UAE Labour Law and also any conditions in the contract of employment that should be honoured. If an employer provides a contract that states that flights are to be paid, and this is signed by both parties, then this is legally binding and the employer is not permitted to amend the terms to the employee’s detriment in way. If BB’s contract states that flight are paid, but the employer will not pay, then he can register a formal complaint with the Ministry of Human Resources and Emiratisation (MoHRE).

UAE Labour Law makes limited reference to flights and the payment of the cost has always been a matter of practice in the UAE, rather than legal obligation. Article 131 states: "The employer shall, upon the termination of the contract, bear the expenses of repatriation of the worker to the location from which he is hired, or to any other location agreed upon between the parties."

It also states: "Should the reason of the termination of the contract be attributable to the worker, the latter shall be repatriated at his own expense should he have the means therefore." An employer does not have to pay for a flight for an employee at the end and subsequent renewal of a limited contract but it is common for this to be a clause in a contract. If that is the case, then it should be honoured for the duration of the signed contract. BB needs to check it to clarify the terms agreed and if the employer has made a change he can register a complaint against them.

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I joined a company at the end of April 2017 with the designation of accountant. My contract is limited and they gave me a six-month probation period that I have now finished. I don't want to continue with this role, but will I get banned if I resign even if I give them one month’s notice? Will I need to pay the visa costs and how much is that? YA, Abu Dhabi

There are two issues here, that of a potential ban and also the penalties for breaking a contract. In each case the rules are different for people on limited and unlimited contracts.

For someone on a limited contract, who has committed to a company for a specified period, if they leave early they can receive an employment ban if the employer requests one. Article 128 of UAE Labour Law states: "Should the non-national worker leave work without a valid cause prior to the end of the contract with definite term, he may not get another employment even with the permission of the employer for a year from the date of abandonment of the work. No employer may knowingly recruit the worker or retain in his service during such period." That said, if the employment is ended on good terms, it is possible for Article 130 to apply and this says: "Non-national workers obtaining prior to the employment in another job the consent of the Minister of Labour and Social Affairs in accordance with the authorisation of the original employer shall be exempt from the provisions of Articles 128 and 129." This is at the discretion of the original employer and is dependent on the individual having another job lined up. The higher the level of the new role, the more likely it is that a ban can be waived.

The other issue is that of breaking the contract terms. In this situation, Article 116 of Labour Law applies and this states: "Should the contract be rescinded by the worker … the worker shall be bound to compensate the employer for the loss incurred thereto by reason of the rescission of the contract, provided that the amount of compensation does not exceed the wage of half a month for the period of three months, or for the remaining period of the contract, whichever is shorter, unless otherwise stipulated in the contract." This equates to 45 days' salary.

No matter the circumstances of leaving service, the employee is not liable for any costs incurred in employing them. This is covered in Ministerial Order 52 of 1989, Article 6 which states: "The employer or its legal representative shall sign the recruitment application form prepared by the Ministry... such a form shall include the following undertakings: (a) An undertaking from the employer to the effect that he shall sponsor and be responsible for the recruited labourer, the bearing of his recruitment expenses and his employment in accordance with the employment contract in a way not prejudicing the provision of the Federal Law No (8) of 1980 referred to herein ..." This clearly states that this is the employer’s responsibility.

As YA is on a limited contract he will have to pay a penalty for breaking the contract terms but does not have to pay for any of his visa or recruitment costs. It is likely he could receive an employment ban.

Keren Bobker is an independent financial adviser and senior partner with Holborn Assets in Dubai, with over 20 years’ experience. Contact her at keren@holbornassets.com. Follow her on Twitter at @FinancialUAE.

The advice provided in our columns does not constitute legal advice and is provided for information only.