Abu Dhabi, UAESaturday 29 February 2020

'What compensation will I receive if my company closes down?'

The Dubai employee says his employer has been struggling to keep the business afloat

The UAE resident works for a uniform shop in Dubai. Reem Mohammed/The National
The UAE resident works for a uniform shop in Dubai. Reem Mohammed/The National

I am an office boy/tailor working for a uniform company. My company is facing serious financial issues because there is little work coming in and it may have to close down. I have been working for the company since late last year, but am only in the third month on the company visa. The contract is for two years. What compensation should I receive if my company closes or wants to cancel my visa? FJ, Dubai

If someone has a limited-term contract, there are specific terms that apply if they are made redundant. Under UAE Labour Law, as applicable to all private mainland companies and followed by most free zones, Article 115 of the law applies. This states: “Should the employment contract be of a determined term, and the employer rescind same … he shall be bound to compensate the worker for the damage incurred thereto, provided that the compensation amount does not exceed in any case the total wage due for the period of three months or for the remaining period of the contract, whichever is shorter, unless otherwise stipulated in the contract.” This means that FJ should be paid the equivalent of three months’ income as a form of compensation. As the period of service is shorter than 12 calendar months, no end of service gratuity is payable.

The period of service makes little difference to the amount due for the early termination of the contract although it is concerning that a visa was only issued many months after FJ started work with the company. The company was breaking the law, as was the employee, but perhaps more importantly, FJ was not protected by UAE employment laws while he was working without a visa. Had there been any issues he would not have had the right of legal recourse or been assisted by the Ministry of Human Resources and Emiratisation. All employers should apply for the appropriate visa or work permit when someone starts work with them otherwise they are breaking the law and can be subject to fines and restrictions on future visa applications. There is a grace period of up to 60 days during which a visa can be finalised but an application must be made at the outset.

My son wants to visit me in the UAE in September, however his American passport expires at the end of November. He has already booked his flight and can’t make changes, so will he be allowed to enter the UAE if there are just two months left on his passport? If he is allowed in, can he then renew the passport at the US Embassy in Abu Dhabi while he is here? CK, Abu Dhabi

For all UAE visitors who are not GCC nationals, a passport must be valid for at least six months beyond the date of entry to the UAE. This is standard for just about every country in the world for all tourists and visitors, no matter where they are from. Without the required validity the airline will not usually allow a person to check in for a flight. Even though we hear of cases where an airline is more lenient, this is usually for UAE residents with at least three months’ validity on their passport. CK’s son should renew his passport before he travels but if he has already booked his flight, he should also notify the airline of a change of passport number when the new one is received to avoid issues at the airport.

CK’s son should not then need to contact the US Embassy in Abu Dhabi for passport renewal but this is a service that the Embassy provides for US citizens. Its usual turnaround time is six to eight weeks and the service is meant for the use of US nationals resident in the UAE, unless someone loses a passport while travelling.

I am a tourist with an international Malaysian driving licence. I am travelling to the UAE soon, so is it possible to drive in the Emirates during my visit period? HM, Malaysia

Under UAE law, any tourist can rent a hire car provided they have the correct paperwork. This will naturally be a full and valid driving licence and in many cases an International Driving Permit, especially if their home country licence is not in Arabic or English. In each case the car rental company will confirm their requirements and this will usually include payment by credit card.

Driving a privately owned vehicle is different and can vary by emirate. It is often based on an individual's home country and where their driving licence was issued. Specific approval must be obtained by the company that insures the vehicle, in writing, and permission, if given, is usually restricted to close relatives of the vehicle owner.

Keren Bobker is an independent financial adviser and senior partner with Holborn Assets in Dubai, with over 25 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

Updated: July 27, 2019 09:32 AM



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