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UAE: Is it legal for my employer to settle my gratuity in instalments?

Photo: Alamy
Photo: Alamy

Abu Dhabi - Know your legal rights about collecting end-of-service benefits in the UAE.

By Ashish Mehta

Published: Sun 24 Jan 2021, 10:29 AM

Last updated: Sun 24 Jan 2021, 10:30 AM

Question: I am an Indian citizen who spent 20 years working for a company in Abu Dhabi. A few months ago, I decided to call it quits and go home. My employer has not paid my full gratuity, but is instead negotiating to pay me in small instalments. Is this legal? Can companies settle end-of-service benefits in instalments? Please advise.

Pursuant to your query, we assume that you were employed in a mainland company based in the emirate of Abu Dhabi. We further assume that you have not signed the work permit cancellation document yet, after serving the stipulated notice period as mentioned in your employment contract.

It is the responsibility of your employer to settle your end-of-service benefits before or at the time of you signing the work permit cancellation document. You may request your employer to settle all your end-of-service benefits before you sign the work permit cancellation document.

The employer must also abide by the Wage Protection System (WPS) and provide to the Ministry of Human Resources and Emiratisation (MoHRE) the proof of payments to its employees related to end-of-service benefits through the WPS. Thereby, the end-of-service entitlements are transferred to the registered bank account of the employee in the UAE or deposited with an approved exchange house where the employer has registered the WPS.

Further to the aforesaid, you may request your employer to transfer your end-of-service benefits to your UAE bank account before you sign a document confirming receipt of all your dues.

If you decide to sign the work permit cancellation document without receiving your dues, it is recommended that you obtain a letter from your employer confirming that they will pay your end-of-service benefits in instalments, as agreed with you, to your bank account in UAE or in India. However, if your employer fails to remit your end-of-service benefits to your bank account in UAE or in India, you may have to initiate an employment complaint against your employer with the MoHRE within one year from your last working day.

In the event the MoHRE does not accept your complaint, stating that the work permit cancellation letter has been signed by you and therefore the matter does not fall within its jurisdiction, you may consequently file a civil claim against your employer before the competent court in the UAE having jurisdiction to decide on this matter.

Ashish Mehta is the founder and Managing Partner of Ashish Mehta & Associates. He is qualified to practise law in Dubai, the United Kingdom and India. Full details of his firm can be found on www.amalawyers.com. Readers may e-mail their questions to news@khaleejtimes.com or send them to Legal View, Khaleej Times, PO Box 11243, Dubai.

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