UAE Employment Contract Termination Rights 2025: Notice, Gratuity & Wrongful Dismissal

Being terminated from your job in the UAE — or choosing to resign — has significant legal and financial implications. Federal Decree-Law No. 33 of 2021 (UAE Labour Law) provides clear rights around notice periods, end-of-service gratuity, and protection against unfair dismissal. This guide explains your rights as an employee and what to do if your termination is unlawful.

Types of Employment Contracts in the UAE

As of 2022, all employment contracts in the UAE must be fixed-term (limited-term):

  • Fixed-term contracts: maximum 3 years, renewable indefinitely
  • All unlimited/open-ended contracts had to be converted to limited-term by February 2023
  • Part-time, flexible, temporary, and freelance contract types are now legally recognised
  • Probation period: maximum 6 months — different termination rules apply during probation
  • Always keep a signed copy of your employment contract

Notice Periods

Both employer and employee must give written notice before termination:

  • Minimum notice period: 30 days (for contracts of 1 year or more)
  • Maximum notice period: 90 days (as stated in the contract)
  • Probation termination: 14 days' notice required
  • Employer must pay your full salary during the notice period
  • Employer can pay in lieu of notice (PILON) rather than require you to work the period
  • Employee who resigns without proper notice may owe the employer damages

End-of-Service Gratuity

You are entitled to end-of-service gratuity after 1 year or more of continuous service:

  • 21 calendar days' basic salary per year for the first 5 years
  • 30 calendar days' basic salary per year for service beyond 5 years
  • Calculated on your last drawn basic salary — allowances are excluded
  • Gratuity is payable even if you resign (after 1 year of service)
  • No gratuity if terminated for gross misconduct under Article 44 of the Labour Law
  • Use the MOHRE gratuity calculator at mohre.gov.ae for your exact entitlement

Wrongful & Arbitrary Termination

If your employer terminates you without valid reason, you may have a legal claim:

  • Arbitrary dismissal: termination unrelated to work performance or conduct
  • Compensation for arbitrary dismissal: up to 3 months' total salary (in addition to notice pay and gratuity)
  • Termination based on race, nationality, religion, gender, or disability is illegal
  • Termination in retaliation for a complaint or legal action is illegal
  • File a complaint with MOHRE within 1 year of the unfair dismissal
  • MOHRE mediates; if unresolved in 14 days, case goes to Labour Court — free for workers earning under AED 20,000/month
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Frequently Asked Questions

Can my employer terminate me without giving a reason in the UAE?

Under UAE Labour Law, an employer must have a valid reason related to work performance or conduct. Terminating without reason constitutes arbitrary dismissal, entitling you to additional compensation of up to 3 months' total salary on top of your notice pay and gratuity.

How is UAE end-of-service gratuity calculated?

Gratuity = 21 days' basic salary per year for the first 5 years, then 30 days' basic salary for each year beyond 5 years. It is based on your last drawn basic salary (excluding allowances). Use the MOHRE online calculator for your exact amount.

Do I get gratuity if I resign from my job in the UAE?

Yes. Under the current UAE Labour Law, you are entitled to full gratuity even if you resign, as long as you have completed at least 1 year of service. Partial final years are calculated on a pro-rata basis.

What happens to my UAE residence visa if I am terminated?

Your residence visa is typically cancelled along with your employment. You have 30 days from visa cancellation to exit the UAE or change your visa status to another sponsor. Ensure your employer processes the cancellation properly.

How do I file a wrongful termination complaint in the UAE?

File a complaint with MOHRE via mohre.gov.ae, the MOHRE app, or by calling 800 60. MOHRE will mediate with your employer. If unresolved within 14 days, the case is referred to the Labour Court at no cost if your salary is under AED 20,000/month.

Official Resources

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General information only. Not a substitute for legal advice from a licensed UAE lawyer.

Legal Disclaimer: This guide provides general information about UAE law and is not legal advice. Laws and regulations change — always verify with official government sources. For specific legal matters, consult a licensed UAE lawyer. This platform is not affiliated with any UAE government entity.