Labour QuestionsQuestion & AnswersWhen Is Termination Considered Arbitrary Dismissal in the UAE?

When Is Termination Considered Arbitrary Dismissal in the UAE?

Arbitrary dismissal is one of the most common employment disputes in the UAE. It occurs when an employer terminates an employee without a valid reason or for reasons that violate the employee’s legal rights.

Under Federal Decree-Law No. 33 of 2021 Regarding the Regulation of Employment Relationship, termination must be based on a legitimate reason related to work performance, conduct, or operational requirements. If the employer fails to justify the termination, it may be classified as arbitrary dismissal.

What Is Arbitrary Dismissal in UAE Labour Law?

Arbitrary dismissal refers to a situation where an employer ends the employment relationship without a lawful reason or in retaliation against the employee. The law protects employees from unfair termination practices and ensures that employers act within legal boundaries.

When Is Termination Considered Arbitrary?

Termination may be considered arbitrary in several situations, including:

1. If the employee is dismissed without a clear or valid reason.
2. If the dismissal is based on a personal conflict rather than professional grounds.
3. If the employee is terminated after filing a complaint with authorities.
4. If the employee is dismissed for claiming their legal rights, such as unpaid salary or leave.
5. If the employer fails to provide evidence supporting the termination decision.

Is Poor Performance a Valid Reason for Termination?

Poor performance can be a valid reason for termination, but only if the employer follows proper procedures. This includes documenting performance issues, issuing warnings, and giving the employee a fair opportunity to improve.

If an employer terminates an employee for poor performance without warnings or documentation, the dismissal may be challenged as arbitrary.

What Is the Compensation for Arbitrary Dismissal?

If a court determines that the dismissal was arbitrary, the employee may be entitled to compensation of up to three months’ salary. The exact amount depends on several factors, including:

• The nature of the employee’s work
• The length of employment
• The damage suffered by the employee

This compensation is separate from other entitlements such as end-of-service benefits, unpaid salary, and unused leave balance.

Can Arbitrary Dismissal Be Proven Without a Contract?

Yes. Even without a written contract, an employee may still prove arbitrary dismissal using other forms of evidence such as emails, WhatsApp messages, salary transfers, witness statements, or internal company records.

What Should an Employee Do If They Are Arbitrarily Dismissed?

An employee who believes they were unfairly dismissed should:

1. Request a written termination letter
2. Collect all employment-related documents
3. Keep records of communication with the employer
4. File a labour complaint with the relevant authority

Early legal advice is important to assess the strength of the claim and ensure that all rights are properly protected.

Conclusion

Arbitrary dismissal occurs when an employee is terminated without a valid reason or in violation of their legal rights. UAE Labour Law provides protection against such practices and allows employees to claim compensation if the dismissal is proven to be unlawful.