A new legal principle has been established by the Dubai Court of Cassation, which bars employers from reducing or cancelling the one-month notice period given to employees once they submit their resignation.
However, the notice period may be increased in the favour of the employee, the court ruled.
The Dubai Court of Cassation explained that the employer and employee cannot enter into an agreement to reduce or cancel the mandatory one-month notice period. The court pointed out that this is according to Article VII of the Labour Law. On the other hand, an increase in the notice period is allowed as long as the increase is in the favour of the employee.
Based on this legal principle, the court issued a verdict in the favour of an employee on the eligibility of three months’ pay (last drawn salary). The court based its ruling on the testimony of witnesses who testified that the employee worked for three months after his resignation.
An administration manager filed a lawsuit against the firm he was working for, demanding dues of Dh765,000, which included Dh150,000 for the three months’ notice period after submitting his resignation.
The plaintiff said in his lawsuit that he joined the company as administration manager with a monthly salary of Dh50,000, and worked for 6 years and 4 months before resigning. He then worked for the firm for three months’ notice period after submitting his resignation.
The Court of First Instance issued a verdict in the favour of the plaintiff, awarding him just Dh83,000. The plaintiff didn’t accept the ruling and appealed before the Court Of Appeal, which amended the ruling and awarded him Dh437,000, including Dh150,000 salary for the three months’ notice period.
This time, the company appealed the ruling before the Court of Cassation. The company based its appeal on Article VII of Labour Law, which stipulates that the notice period is one month, unless both the parties agree to extend it.
The court said in its ruling that even though the labour contract is free to determine the duration of the notice period, it should still comply with the labour law.
The court said Article VII of Labour Law authorises an increase the notice period, bit does not allow it to be to reduced or eliminated. The Court of Cassation ruled in the favour of the plaintiff after reviewing the testimony of witnesses, who confirmed that the plaintiff worked for three months following the submission of his resignation.