This article highlights the key aspects of termination of employment in the UAE, including notice periods, end-of-service benefits, valid dismissal reasons, and the implications of arbitrary termination.
Terminating employment in the UAE is governed by a clear legal framework to ensure fairness for employers and employees.
Federal Decree-Law No. 33 of 2021 is the heart of this structure. It outlines lawful dismissal grounds, employee rights, and protections against unfair termination practices.
These are all crucial for compliance and conflict resolution in 2025.
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Table of Contents
Rules of Termination of Employment in the UAE
Employment contracts in the UAE may be ended for several legitimate reasons or grounds, which include the following:
- Upon expiration of the agreed contract term.
- Through mutual consent between the employer and employee, documented in writing.
- Unilaterally, provided a notice period (typically 30 to 90 days) is served.
- Due to force majeure circumstances, such as permanent business closure or confirmed medical inability to work.
- Following the death of the employer or employee, depending on the nature of the job.
- In cases where the employee receives a final criminal conviction carrying a custodial sentence of three months or more.
- When the employer becomes insolvent or loses the legal ability to maintain the business (e.g., bankruptcy or loss of license).
- If an employee’s work permit cannot be renewed due to external legal or administrative constraints.
Notice Period Obligations
The notice period for termination of employment in the UAE is a formal transition phase.
It is required for both employer and employee unless the termination occurs during the probationary period (maximum six months) or under exceptional conditions like gross misconduct.
During this period, the employee is entitled to their full salary and must continue performing their duties unless otherwise agreed.
Failure by either party to observe the notice period results in financial compensation to the other party, equivalent to the salary for the notice period not served.
Grounds for Immediate Termination Without Notice
Immediate termination without notice is permitted in cases of serious misconduct.
Examples include theft, assault, intoxication at the workplace, gross negligence, or providing false documentation or qualifications.
For instance, an employee found working under the influence of alcohol or involved in physical altercations at work may be dismissed on the spot under the UAE Labour Law.
Conversely, employees can resign without notice if the employer significantly breaches contractual or legal obligations.
For example, suppose an employee raises ongoing concerns about unsafe working conditions and the employer fails to take corrective action.
In that case, the employee can leave immediately and still claim full end-of-service gratuity.
Employee Protections and Arbitrary Dismissal
The law includes specific provisions to prevent unfair dismissal.
Under Article 47 of the UAE Labour Law, if an employee is terminated for filing a complaint with the Ministry of Human Resources and Emiratisation (MOHRE) or initiating legal action, the dismissal is unlawful.
In such a case, the employee is entitled to compensation up to three months’ salary, as determined by the court, and the regular benefits owed.
Examples of Unlawful Termination in Dubai
Suppose an employee is dismissed shortly after complaining about harassment or discrimination, and it’s proven that the dismissal was retaliatory.
In that case, the employer may be liable for significant compensation and other penalties.
The law also provides enhanced protection for specific categories of employees.
A notable example includes female workers on maternity leave—termination during this period is strictly limited to exceptional, well-documented cases.
Suppose a woman is dismissed during maternity leave without proper legal justification (such as a genuine business closure).
In that case, she must be reinstated or compensated and remains entitled to all her statutory benefits, including end-of-service pay.
Learn about employment termination in UAE free zones, including JAFZA Employee Termination Rules, DMCC Termination of Employment, and DMCC Arbitrary Dismissal.
Gratuity Payments and End-of-Service Entitlements
Employees who have completed at least one year of continuous service are entitled to end-of-service benefits, commonly called gratuity.
The amount is calculated based on the employee’s final basic salary. The gratuity is equivalent to 21 days’ wages for the first five years of employment for each completed year.
The calculation increases to 30 days’ wages for any service period beyond five years for each additional year.
These payments are made upon lawful termination, provided the employee was not dismissed for serious misconduct.
Expatriate workers are entitled to receive this gratuity at the end of their employment unless terminated under legally justified disciplinary grounds.
On the other hand, Emirati nationals receive their post-employment benefits under the UAE’s national pension and social security regulations.
Legal Support for Employment Termination Issues in UAE
Given the complexity of employment law in the UAE, professional legal support is crucial for anyone facing or initiating termination of employment in the UAE.
Our legal consultants in Dubai offer a wide range of services tailored to both employers and employees:
- Representation in Employment Disputes
We represent clients in disputes related to arbitrary dismissal, breach of employment terms, and denial of entitlements, guiding them through the MOHRE complaint process and court proceedings. - Calculation and Claiming of End-of-Service Benefits
We provide accurate assessment and legal assistance in securing gratuity payments, unpaid wages, and other financial entitlements following the end of an employment contract. - Review and Drafting of Employment Agreements
Our legal experts analyze contracts to comply with UAE labour laws, focusing on notice periods, termination clauses, and employee protections. - Dispute Resolution and Litigation Services
Whether through direct negotiation, ministry-led mediation, or full court litigation, we support our clients with a comprehensive approach to resolving employment-related disputes. - Legal Strategy for Employers
We assist employers in executing lawful terminations, minimizing legal exposure, and ensuring due process. This includes preparing compliant termination notices and documenting valid reasons for dismissal.
Find more services from Top Labour Law lawyers in Dubai.
FAQs about Ending of Employment in UAE
Termination of employment in the UAE is subject to clear and structured regulations designed to protect both parties in the employment relationship.
Employers and employees can ensure fair and lawful contract termination by understanding the legal grounds for dismissal, required notice periods, and financial entitlements.
Our legal team is here to provide expert assistance with employment-related legal matters in the UAE, including termination disputes and contractual compliance.
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A law graduate and legal writer focusing on UAE law, he became known for his ability to clarify complex legal concepts through his writings. His work simplifies the intricacies of the legal landscape in the Emirates, helping both locals and expatriates navigate their legal concerns.
