Termination of Employment in UAE: Detailed Guide for 2025 Based on UAE Labour Law
28-05-2025
Introduction: Understanding Termination of Employment in the UAE
The termination of employment in the UAE is governed by the Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations, commonly known as the UAE Labour Law. This law ensures fairness and clarity for both employees and employers in the private sector. Whether you're an employee wondering about your rights when losing a job, or an employer needing clarity on how to legally end a contract, this guide will walk you through the updated termination rules in the UAE for 2025.
We'll explore:
- Situations under which a job contract can end
- Notice period rules
- Termination with or without notice (for both parties)
- What counts as arbitrary dismissal in the UAE
- Legal options and compensation
- What happens after your contract ends (changing jobs or leaving the country)
Situations Where an Employment Contract Can Be Terminated in UAE (Article 42)
Under Article 42 of the UAE Labour Law, a work contract may be legally terminated in any of the following ways:
1. Expiry of Contract Term
If the contract's duration ends and neither party extends or renews it, the employment automatically terminates.
2. Mutual Agreement
Both the employer and employee can agree in writing to end and terminates the contract before its end date.
3. Resignation or Termination by One Party
Either the employer or the employee may initiate the termination of the employment contract, as long as they:
Follow the agreed notice period
Provide a valid and legitimate reason for termination
4. Employer’s Death
If the employer dies and the work is linked to the existence of the business owner (like a sole proprietorship), the contract may terminates.
5. Employee’s Death or Permanent Disability
The Employment Contract Can Be Terminated If the worker dies or is fully and permanently disabled, supported by an official medical report.
6. Imprisonment of Employee
Employment Contract Can Be Terminated If the employee is given a final court ruling that imposes a freedom-restricting penalty of at least 3 months.
7. Permanent Closure of Company
If the establishment shuts down permanently in accordance with UAE laws.
8. Employer’s Bankruptcy or Economic Inability
If the employer is bankrupt, insolvent, or facing exceptional economic circumstances that make continuing the business impossible.
9. Non-renewal of Work Permit
Employment Contract Can Be Terminated If the employee fails to meet the requirements for renewing the work permit for reasons beyond the employer’s control.
These rules ensure that the end of employment happens transparently and fairly for both sides.
Visit Time Attendance System in Dubai
Check Out Mobile Attendance App in the Middle East - TimeChart
Notice Period Rules in The UAE Under Article 43
According to Article 43 of the UAE Labour Law, both parties can terminate the contract for any legitimate reason with proper notice:
Notice Period Must Be in Writing
- Either party must give written notification
- Notice must be between 30 to 90 days (as agreed in the contract)
During the Notice Period
- The employee must continue working as normal
- The worker is entitled to full salary during this time
- If the employer ends the contract, the worker gets one unpaid leave day per week to search for a new job
If Notice Is Not Given
- The party failing to serve the notice must compensate the other
- Compensation equals the wage of the full notice period (or the remaining time)
Mutual Agreement
- The notice period can be shortened or removed if both parties agree
- This cannot infringe on either party’s legal rights
Read More - Limited Contract Resignation UAE
Termination Without Notice by Employer in the UAE (Article 44)
In certain serious cases, termination without notice is legal and justified under Article 44. Employers can dismiss employees immediately in the following cases:
1. False Identity or Forged Documents
If the worker used a false identity or fake documents to get the job.
2. Serious Loss or Damage
If the employee commits a mistake causing significant material loss or intentionally damages company property.
Note: The employer must notify MoHRE within 7 working days of the incident.
3. Repeated Safety Violations
If the employee fails to follow workplace safety rules after being warned.
4. Negligence of Duties
If the employee repeatedly fails to perform their job responsibilities despite receiving two written warnings.
5. Disclosure of Confidential Information
If the worker leaks company secrets, causing harm or loss.
6. Alcohol or Drug Use at Work
If the employee is intoxicated or under the influence during work hours.
7. Physical Assault or Immoral Acts
If the employee assaults others or acts in an immoral manner at the workplace.
8. Unjustified Absence
If the employee is absent:
More than 7 consecutive days without excuse
More than 20 intermittent days in a year
9. Illegal Use of Position
If the employee uses their position to gain unlawful personal benefits.
10. Working for a Competitor
If the employee joins another employer without permission or before properly leaving the current one.
Note: Dismissals under Article 44 must be based on a written investigation and provided to the employee with justification.
Termination Without Notice by Employee in the UAE (Article 45)
Employees may also terminate their contract without notice if certain conditions are met under Article 45:
1. Breach of Contract by Employer
- Notify MoHRE 14 working days in advance
- If the issue is not resolved, they can resign without notice
2. Harassment or Assault
If the employee is physically assaulted or sexually harassed and reports it within 5 days to authorities and MoHRE.
3. Change in Job Role
If the employer assigns work very different from what was agreed upon in the contract without the employee's written consent.
4. Serious Safety Threats
If there are serious health or safety risks at the workplace and the employer fails to fix them.
Arbitrary Dismissal in the UAE (Article 47)
Under Article 47 of the UAE Labour Law, an employer cannot terminate a worker because they:
- Filed a complaint to MoHRE
- Filed a valid legal case against the employer
What Happens If Arbitrary Dismissal is Proven?
The employer must pay compensation to the employee
Compensation is based on:
- Type of work
- Duration of employment
- Financial damage suffered
The compensation must not exceed the employee’s 3-month salary (based on last drawn salary)
In addition, the worker is entitled to:
- End of service benefits (gratuity)
- Unpaid salary
- Remaining notice period payment
If you believe you've been dismissed unfairly, file a complaint with MoHRE. If no agreement is reached, the case goes to court.
Changing Jobs After Termination
After termination or contract expiry, employees have options under Article 27 of Cabinet Resolution No. 1 of 2022:
You May Join a New Employer If:
- Your fixed-term contract ended and wasn’t renewed
- The contract was terminated legally (per Articles 42 and 45)
- Your employer terminated the contract without valid reason
Grace Period
- You have a legal grace period after your visa is cancelled. During this time you can:
- Apply for a new work permit
- Change employer
- Leave the UAE
Illegal stay beyond the grace period can result in fines or deportation.
Visit MoHRE or ICP UAE for updated information on grace periods and visa renewal options.
Restrictions on New Work Permit (Article 8 - Ministerial Resolution No. 47 of 2022)
- You may not receive a work permit for 1 year if:
- You resign during probation period, and the employer did not breach the contract
- A work abandonment report is filed and proven true
End-of-Service Gratuity Calculation in the UAE
Under UAE Labor Law, gratuity is a statutory end-of-service benefit. The gratuity calculation in the UAE depends on contract type (limited/unlimited) and length of service.
Gratuity for Full-Time Employees:
Less than 1 year: No gratuity.
1 to 5 years: 21 days’ basic wage per year.
Over 5 years: 30 days’ basic wage per year after 5 years.
Example Calculation:
If an employee worked 6 years and earned AED 10,000/month:
First 5 years: 21 days x 5 = 105 days = AED 35,000
6th year: 30 days = AED 10,000
Total gratuity: AED 45,000
Deductions may apply if the employee resigns early or under specific breach conditions.
Post-Termination: Changing Jobs and Grace Period
Under Article 27 of Cabinet Resolution No. 1 of 2022:
Employees can switch employers and obtain a new work permit if:
- The contract expires and is not renewed.
- It is terminated as per Articles 42 or 45.
- The employer terminates without providing a reason.
Following termination:
- A grace period is granted to find a new job or exit the country.
- Overstaying leads to fines or deportation.
- Visit MoHRE or ICP for latest info on grace periods, permits, and legal requirements.
Work Permit Ban After Termination (Article 8, Ministerial Resolution No. 47 of 2022)
You may not receive a new work permit for one year if:
- You terminate during probation without valid cause.
- A work abandonment report filed against you is proven true.
Rights and Responsibilities: Employees vs Employers
Employee Rights:
- Receive full notice period wage.
- Entitled to unpaid leave during notice for job search.
- Claim gratuity, unpaid wages, and other dues.
- File complaint in case of arbitrary dismissal.
- Change jobs legally after termination.
Employer Rights:
- Terminate contracts with valid reason and notice.
- Initiate dismissal without notice in cases under Article 44.
- Withhold benefits if employee breaches contract or falsifies information.
Real Cases Under UAE Labour Law for Termination of Employment in Dubai
Let’s break down a few examples based on current UAE labour law:
Unsafe Work Conditions
An employee working in Dubai leaves the job because the company ignores repeated safety complaints. Labour law for termination of employment in UAE allows the employee to resign without notice. The worker remains eligible for all legal entitlements.
Termination During Maternity Leave
A female employee is dismissed while on maternity leave. The law protects her during this time unless exceptional circumstances exist. The employer may face legal penalties and must provide full compensation.
Wrongful Dismissal After Complaint
If an employee is fired after raising a complaint with MOHRE, this is treated as unlawful. The court may award compensation and enforce the employer to pay the end-of-service benefits and notice period.
FAQs on Labour Law for Termination of Employment in UAE
1. What are the legal reasons for terminating an employment contract in the UAE?
Under Article 42 of the UAE Labour Law, an employment contract can be legally terminated if:
The contract period ends and is not renewed.
Both parties agree in writing to end the contract.
Either party chooses to terminate with proper notice.
The employer or employee dies or becomes permanently disabled.
The business shuts down, or the employer faces bankruptcy.
The worker can’t renew their work permit for reasons beyond their control.
2. How long is the notice period for terminating a job in the UAE?
According to Article 43, the notice period must be between 30 to 90 days, depending on the agreement in the contract. During this time:
The employee must continue working.
Full salary is paid.
Either party failing to serve notice must compensate the other.
3. Can an employer fire an employee without notice in UAE?
Yes. As per Article 44, an employer may terminate without notice in cases like:
Submitting fake documents.
Repeated poor performance or serious misconduct.
Absenteeism (over 20 days intermittently or 7 consecutively).
Drug use, physical assault, or breach of public morals.
However, a written investigation and valid proof are required before such termination.
4. When can an employee resign without notice under UAE Labour Law?
Under Article 45, an employee may leave the job without notice if:
The employer fails to meet contractual obligations.
The employee is harassed or assaulted at work.
Unsafe working conditions persist without correction.
The worker is forced to do a job not mentioned in the contract.
In most of these cases, MoHRE must be notified within 5–14 working days.
5. What is considered arbitrary dismissal in the UAE?
Article 47 defines arbitrary dismissal as firing an employee:
For filing a complaint with MoHRE.
For initiating a court case against the employer (and it’s proven valid).
In such cases, the employee is entitled to compensation up to three months' salary, plus gratuity and any pending dues.
6. Can I work for another employer after termination in the UAE?
Yes. After your job ends:
You can apply for a new work permit.
A grace period is given to stay in the UAE (usually 30–60 days).
You must not have violated contract terms (like absconding or illegal exit) to avoid a work ban.
7. What happens if I resign during my probation period in the UAE?
If you resign during probation without employer misconduct:
A 1-year work ban may apply.
You must give 14 days' notice as per UAE law.
If you leave without notice, your employer can report you for work abandonment.
8. How can an employee claim compensation after being terminated in UAE?
If you believe your termination was illegal or unfair:
File a complaint with MoHRE first.
If no solution is reached, the case is sent to the Labour Court.
The court will review your case and may award compensation, gratuity, and unpaid dues.
Conclusion: Stay Informed and Protected Under UAE Labour Law
The termination of employment in UAE is a structured legal process, carefully governed by the updated UAE Labour Law 2021 and its executive regulations. Whether you're an employee or an employer, understanding your legal rights and obligations is essential.
Key takeaways:
Both parties can end the contract legally, but must follow proper notice and procedures
Termination without notice is allowed in extreme cases only, and must be documented
Workers have the right to compensation in case of arbitrary dismissal
After termination, employees can switch jobs legally and must follow proper exit or transfer procedures
Stay updated with MoHRE announcements and always consult legal experts if you're unsure about your rights.
Keywords used: UAE Labour Law, termination of employment, employment contract UAE, termination rules in UAE, termination without notice UAE, arbitrary dismissal in UAE
تطبيق الحضور المتنقل في السعودية
أهم أنواع نظام الحضور والانصراف
Time Attendance System in Dubai
Also Do Visit Our Free Tools
Leave Salary Calculator UAE Gratuity Calculator UAE Overtime Calculation in UAETime Chart - Decimal to Hours and Minutes Calculator
Time Chart - Online Mileage & Fuel Cost calculator
Time Chart Free Work Hour Calculator & Time Card
Time Chart - Convert Military Time
Time Chart - Online Free Timer Clock
Time Chart - Online Pomodoro Timer
Transform Your Business Process with TimeChart - Request a Demo
See TimeChart Work Time Software in action by scheduling a demo. Our team can create custom implementation plans to suit your business needs and show you how TimeChart can transform your Business Process. Contact us Now! Read More in Detail:
Sick Leave in UAE Labour Law Unpaid Leave in UAE Labour Law Annual Leave in UAE & Policy in UAE Labour Law MOHRE - Workers’ Rights & Guidelines UAE Government - Types of Leave & EntitlementsDisclaimer
The information provided in this article is intended for general informational purposes only and does not constitute legal advice. TimeChart is not a law firm and does not offer legal consultation or representation. While we strive to keep the content accurate and up to date, we do not guarantee the completeness, accuracy, or current validity of any information shared.
Before making any decisions or taking any action based on the content of this article, you are strongly advised to consult a qualified labour lawyer or seek professional legal guidance. For the most accurate and official information, please refer to the UAE Labour Law, visit the official websites of the Ministry of Human Resources and Emiratisation (MoHRE), and other relevant UAE government portals.
TimeChart shall not be held responsible for any errors, omissions, actions taken, damages, or losses that may result from using or relying on the information provided. This article is a summary of content available publicly on the internet and should not be considered official or authoritative. We also do not commit to regularly updating this content or reflect any future legal changes.
Other Services we Offer in Dubai
Tally PrimeCCTV installation in Dubai
Software development
App development
HRMS software
Tally software for accounting
IT AMC in Dubai
Data centers in Dubai
Access control system
Endpoint security in Dubai
Firewall Security in Dubai
Structured cabling in Dubai
Appsanywhere: Web Based App
Performance Management System
Time Attendance System Software
Smart Visitor Management System
Drone Camera Price in Dubai
Drone Camera Price in Saudi Arabia
Buy High-Resolution Satellite Imagery
DJI Store in Dubai
Best Billing Software and Invoicing Software
RECENT BLOG
Top 10 Best Electrical Stores in UAETop 10 Best Wooden Pallet Suppliers in UAE
Cheapest Supermarkets in Dubai for Groceries
Recruitment and Employment Agencies in Dubai, United Arab Emirates
Top Facility Management Companies in Dubai, UAE
Weekdays and Months in Arabic for Employees Working in Arab Countries
10 Best Electrical Supply Stores in Dubai, UAE
Top 10 UAE Steel Companies
Limited Contract Resignation UAE
Probation Period in the UAE
UAE Labor Card: Everything You Need to Know
Leave Salary Calculator UAE
Which Countries Have a Friday-Saturday Weekend in the Arab World?
New Public Holidays, Weekends, and Leave Types in Oman
New Public Holidays, Weekends, and Leave Types in Bahrain
New Public Holidays, Weekends, and Leave Types in Qatar
New Public Holidays, Weekends, and Leave Types in Saudi Arabia
Sick Leave UAE Labour Law
Unpaid Leave UAE Labour Law
Why Tally Prime is the Best Accounting Software for Businesses in Dubai
Best SEO Services in Dubai
Free Box Shadow CSS Generator Online
Hyperlink HTML Generator Online Free
HTML Table Generator Free Online
Word Counter Arabic
Free Amount to Words Converter Online
Best Drop Shadow Generator Free Online