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Paying 45 days' salary to the company at the end of the limited contract

Hi mam,

Good afternoon!

An employee completed 6 years. His last contract is limited.

He finished his contract. Should he pay 45 days' salary to the company?

Kochhar & Co Inc. Legal Consultants (Dubai Branch)
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28 Jan 2020, 19:08

No, but under the lastest ministry resolution, all employees have to give notice.

29 Jan 2020, 05:47

Thanks, mam!

29 Jan 2020, 10:55

To sum it up. The limited contract ends for the first time at the end of its term. If another limited contract is signed, then it is called renewal.

If the employee does not want to renew the limited contract, then Article 1 (1) is applicable - i.e. it ends. But if the employee continues the 2nd or 3rd renewal, then he must comply with 1 (4) of Ministerial Decree (765) of 2015 on the termination of employment relations.

Article ( 1 )

An employment relation between employer and worker may be terminated as follows:

In the case of fixed-term contracts (approved by the Ministry for a term of no more than two years), an employment relation is terminated if any of the following instances occur:

1- The term of the contract expires and the contract is not renewed.

2- Employer and worker mutually consent to terminate the contract during the course of its term.

3- Either party (employer or worker) acts unilaterally to terminate the contract and complies with the legal steps that are described in clause (4) of this article. The terminating party bears any legal consequences of early termination.

4- Either party (employer or worker) acts unilaterally to terminate a renewed term contract, whether renewal has occurred before or after this decree enters into effect, provided the terminating party complies with the following legal steps:

a. Notify the other party in writing of its intent to terminate the contract in accordance with the notice period to be agreed to by the two parties, not to be less than one month and not to exceed three months.

If renewal occurred before this decree enters into effect and the parties had not agreed to a notice period, this notice period shall be three months.

29 Jan 2020, 13:23

Good evening, mam!

You have some lawyers to appear in court for an employee case?

29 Jan 2020, 13:37

It is not clear whether the representation is for the employee or employer.

29 Jan 2020, 13:59

The representation is for the company.

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