Banks can deduct more than half the salary to claim dues

Your pay is not ‘salary’ once it is transferred to bank: Dubai Court

Banks have the right to deduct more than half of an employee's salary to claim dues owed, according to a new principle established Dubai Court of Cassation.

The court explained that the salary or wage of the employee or worker which transferred to the bank will lose its description as "salary" or pay once transferred to the bank.

Therefore, as a result of that the salary or wage will not be subjected to Article No 247 of the Code of Civil Procedure, which does not permit seizure of wages or salaries by half of basic pay.

This principle was issued when the court heard a case brought by an agent of a bank against the bank, where he asked the court to assign an expert to determine the origins of loans granted to him, amounts paid and amounts due.

He said in his lawsuit that the bank refused to give him a copy of loan applications submitted by him, and as well refused to give him a statement on the legal status of those loans.

Also the bank had foreclosed the balance in his account.

The Court of First Instance ruled to dismiss the case, but the plaintiff appealed and the Court of Appeal upheld the appellant ruling.

Once again the plaintiff appealed the verdict before the Court of Cassation which issued the above-mentioned legal principle.

However, the appellant was based on the text of Article 247 of the Code of Civil Procedure, which does not allow banks to deduct more than half of the basic salary.

But the Court of Cassation rejected this reason based on the ruling that employee's salary or wage of the worker loses described as "salary" as soon transferred to the bank.

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