Service charge is not landlord’s burden

My current tenancy contract is due for renewal for the third year in August 2013. The landlord has informed me in advance of a rent hike, which has been negotiated and agreed. However, the tenancy contract has a clause of five per cent ‘service charges’ in addition to the rent. This amounts to an additional burden over and above the increased rent. I would like to know if the levying of service charges is legal under the Real Estate Regulatory Authority (RERA) or tenancy regulations in Dubai. I understand that all maintenance should come out of the rent paid.

The prevailing laws and regulations of the RERA do not have a provision to impose such a service charge on the owner of a property, in Dubai. You may approach the authority in Dubai for further clarification on this matter.

I have been working as a cleaner in a school in Al Ain under a limited contract which will expire on May 26, 2013. I told my employer that I do not wish to continue my contract, and they said that I needed to give them a letter of resignation, which I did, writing in my last working day as the date on which my contract expired.

The problem is my company is not giving me a repatriation ticket to go back to my home country as they say since I am the one who resigned. The company also said I am only a support staff and I am not entitled. Does the law allow me a ticket?

You informed your employer that the last date of working with the employer will be the date of expiry of your limited period employment contract i.e. May 26, 2013, in writing. Therefore it may be argued that you notified your decision not to renew the limited period employment contract, to your employer; not to resign as alleged by your employer.

You may check your employment contract on entitlement of an air ticket home. In the event the employment contract is silent on the entitlement of a ticket, you may rely on Article 131 of the Federal Law No 8 of 1980 on Labour Relations which states: “An employer shall, on the termination of a worker’s contract, defray the cost of returning him to the district from which he was recruited or to any other place agreed upon between the two parties. Where after the termination of his contract, a worker enters the service of another employer, the latter shall defray the worker’s travelling expenses on the termination of his service. Subject to the provisions of the preceding sentence, if the employer fails to return the worker or to defray his travelling expenses, the competent authorities shall do so at the employer’s expense and may then recover any expenditure incurred in this connection by attachment. Where the reason for the termination of contract is attributable to the worker, his travel shall be at his own expense if he has the wherewithal to pay.”

There is no merit in your employer declining to provide you a ticket for air travel on the basis of your designation as a cleaner.

You may file a complaint with the Ministry of Labour in the event your employer fails to comply with the provisions of Federal Law No. 8 of 1980 regulating labour relations and your employment contract.

I am a post-graduate doctor working in a private clinic in Sharjah. I was under an unlimited contract and will be completing three years next month. The management wants to change the contract to a limited one now. What are the consequences if I agree to the new contract? Can they change the contract with an internal contract rather than the official labour contract? If I want to leave the institution before the limited contract period, how will this affect me?

It is understood that your employer wants to change your employment contract from a contract of unlimited duration to a contract of a limited duration. In the event you accept the change, the basis of calculation of your gratuity and requirement to terminate the employment contract or resign will change on the basis of the below comparison:

Gratuity, under unlimited period employment contract is calculated based on Article 137 of the Federal Law which states: “Where a worker who is bound by a contract of unlimited duration leaves his work on his own accord after continuous service of not less than one year and not more three years, he shall be entitled to one third of the severance pay provided for in the preceding article; where the continuous period of service exceeds three years but does not exceed five years, he shall be entitled to two-third of such severance pay; where the continuous period of service exceeds five years, he shall be entitled to full severance pay.”

Whereas, gratuity under a limited period employment contract is calculated based on Article 138 of the Federal Law, which states: “Where a worker who is bound by a contract for a limited period leaves his work of his own accord before the expiry of his contract period, he shall not be entitled to severance pay unless his continuous period of service exceeds five years.”

Termination or resignation under an unlimited period employment contract should be pursuant to Article 117 of the Federal Law which states:

“(1) Both the employer and the worker may terminate a contract of employment of unlimited duration for a valid reason at any time following its conclusion by giving the other party notice in writing at least 30 days before the termination.

(2) In case of workers working on a daily basis, the period of notice shall be as follows:

a. one week, if the worker has been employed for more than six months but less than one year;

b. two weeks, if the worker has been employed for not less than one year;

c. one month, if the worker has been employed for not less than five years.”

Whereas termination or resignation, under limited period employment is pursuant to Article 116 of the Federal Law, which states: “Where a contract is revoked by the worker for reasons other than those specified in Article 121, he shall be required to compensate the employer for any prejudice the latter sustains as a result: provided that the amount of compensation shall not exceed half the worker’s remuneration for three months or the residual period of the contract; whichever is shorter unless the contract contains a provision to the contrary.”

The employer and the employee should execute and file a limited period employment contract with the Ministry of Labour.

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Ashish Mehta, LLB, F.I.C.A., M.C.I.T., M.C.I.Arb., is the founder and Managing Partner of Ashish Mehta & Associates, a legal consultancy firm in Dubai. He also practises in India, United Kingdom and Singapore. He has worked with international and commercial legal procedures, providing analysis and counselling on complex legal documents and policies such as commercial transactions, securitisation, real estate acquisitions, financial restructuring for distressed assets, mergers and acquisitions, arbitration and litigation issues. Readers may e-mail their questions to: news@khaleejtimes.com or send them to Legal View, Khaleej Times, PO Box 11243, Dubai.