Employees are entitled to gratuity i time they consummate i twelvemonth of continu
I convey a inquiry well-nigh the calculation of gratuity on an unlimited contract. My employer calculates gratuity differently for employees who resign as well as for employees who are terminated. If the employee resigns, gratuity is calculated equally 7 days per twelvemonth for the kickoff iii years, as well as 21 days per twelvemonth subsequently that. If the employer terminates, gratuity is calculated equally betwixt 2 as well as 21 days of each completed year.
Is this a legal practice?
Pursuant to your questions, your employer should calculate gratuity payable to the employees inwards accordance alongside the Federal Law No.8 of 1980 regulating Employment Relations inwards the UAE (the 'Employment Law'). If an employee is entitled to gratuity equally per the Employment Law, as well as thence the employer should follow the provision of Employment Law. Employees are entitled to gratuity i time they consummate i twelvemonth of continuous service, provided they fulfill the criteria position downwards inwards Article 132 of the Employment Law, which states: "An employee who has completed a menstruation of i or to a greater extent than years of continuous service shall last entitled to severance pay on the result of his employment. The days of absence from move without pay shall non last included inwards calculating the menstruation of service. The severance pay shall last calculated equally follows:
(1)21 days' remuneration for each twelvemonth of the kickoff 5 years of service.
(2)30 days' remuneration for each additional twelvemonth of service provided that the aggregate amount of severance pay shall non overstep 2 year's remuneration."
Further, Article 137 of the Employment Law states: "Where an employee, who is outflow yesteryear a contract of unlimited duration leaves his move of his ain accord subsequently continuous service of non less than i twelvemonth as well as non to a greater extent than than iii years, he shall last entitled to one-third of the severance pay provided for inwards the preceding article; where the continuous menstruation of service exceeds iii years simply does non overstep 5 years, he shall last entitled to two-third of such severance pay; where the continuous menstruation of service exceeds 5 years, he shall last entitled to the total severance pay."
Further, Article 138 of the Employment Law states: "Where an employee who is outflow yesteryear a contract for a express menstruation leaves his move of his ain accord earlier the move out of his contract period, he shall non last entitled to severance pay unless his continuous menstruation of service exceeds 5 years."
Further, Article 139 of the Employment Law states where an employee is non entitled for gratuity payment. It reads equally "an employee shall forfeit all entitlements to severance pay inwards whatsoever of the next 2 cases:
(a)If he is dismissed from service for whatsoever of the reasons specified inwards Article 120 of this Law or if he leaves his move inwards club to avoid existence dismissed inwards accordance alongside that Article;
(b)If he leaves his move of his ain accord as well as without notice, otherwise than inwards either of cases specified inwards Article 121 of this Law (in the illustration of contract of unlimited duration) or earlier completing 5 years of continuous service (in illustration of contracts for a express period)."
KNOW THE LAW
When an employee, who is outflow yesteryear a contract for a express period, leaves his move of his ain accord earlier the move out of his contract period, he shall non last entitled to severance pay unless his continuous menstruation of service exceeds 5 years.