Questions & Answers
Should I sign an agreement after my healthcare employer's insolvency voids my offer letter?
Dear Lawyers,
An old healthcare organization goes into insolvency. I, being employed by the organization, have been informed that my offer letter is considered null and void due to insolvency.
They are asking me to sign an agreement stating that I have no relationship with the previous company and cannot file a case against the new company.
In this case, what should be done? Do I need to sign the agreement?
They have not provided any details about the new group that is going to take over.
Could you kindly advise on how to approach this situation according to UAE labor law?
Dear Questioner,
According to UAE labor law, if an organization goes into insolvency, the employees' contracts with the company are considered terminated.
In this case, the employees are entitled to receive their end of service benefits, including any unpaid salaries, gratuity, and other benefits as per their contract.
If the company asks you to sign an agreement stating that you have no relationship with the previous company and cannot file a case against the new company, it is important to carefully review the terms and conditions of the agreement before signing it.
Dear Questioner,
What to do:
Do not sign the agreement until you are sure that your dues have been paid or that the new agreement does not prejudice your rights.
Inquire about the new company and make sure of its information and the legal obligations it assumes.
