UAE eases labor rules for expats
DUBAI, United Arab Emirates – As Dubai sets the stage for more projects related to hosting the much touted World Expo 2020, major labor rules were recently relaxed that stand to benefit millions of expatriates, including Filipinos.
Philippine ambassador to the UAE Constancio Vingno Jr said the major changes which include lifting the 6-month mandatory ban on those who fail to finish their two-year employment contracts, considering the offer letter between the employee and employer as a binding contract between the parties, among others, are important policy shifts that favor expats in the UAE.
“In general, these changes are really good. We are still waiting for more guidelines from the UAE government on how these changes will be applied. Let’s give it some time,” the envoy said. His jurisdiction covers close to a million Filipinos spread across the 7 emirates of this oil-rich Arab nation whose locals are outnumbered by the expat population.
Vingno said the removal of the 6-month labor ban will allow a lot of overseas Filipino workers (OFWs) to immediately look for other jobs instead of going back home and waiting for their ban to be lifted.
Moreover, he said this new policy will also free up workers in case they find better jobs, rather than force them to stay with their employer for two years.
The diplomat said the offer letter taken as a binding contract would eliminate contract substitution, a common complaint among some OFWs who were promised high salaries and fringe benefits upon recruitment. In some cases, these benefits were changed in the final employment contracts.
Relief for workers
While the policy changes are good for all foreign workers, not just Filipinos, “implementation is another thing.” He added, “Let’s give it a little more time.”
The UAE Ministry of Labor announced that the new labor policy changes took effect on January 1, 2016.
UAE Labor Minister Saqr Ghobash said the reform measures are designed to address concerns in the country, specifically the mobility of expats.
The Labor Ministry said Ministerial Decrees (MDs) 764, 765, and 766 are aimed at creating a new, unified standard labor contract.
“The new rules will also bring greater transparency, clarity and tighter monitoring of labor contract conditions and ensure both employer and employee enter into fully voluntary relationships,” the ministry said in a statement.
For new and old OFWs in the UAE, the news is uplifting and very much welcome, though some were confused.
Mazel Besas who recently got hired as a saleslady – commonly called here promoter – said the eradication of the 6-month labor ban is a relief for workers who don’t want to stay in a company.
“Kung ayaw na ng worker, at least makakaalis siya instead of working for two years. Mahirap kasing magtrabaho pag pilit,” said 25-year-old Besas. (If a worker no longer wants to work, at least he can immediately leave instead of working for two years. It’s hard to work when it’s forced.)
Though relatively young, Besas is actually a veteran OFW. She had spent 8 years in Sicily, Italy where her parents have work as domestic helpers for ages now.
She said she took different odd jobs in Italy while studying a short-term course to help her parents build their dream house in Balayan, Batangas.
Compared to Italy, Besas said conditions are more favorable there and the pay is much better, but she wants to try it in Dubai to be with her only sister who works as a medical technologist.
Another OFW who asked not to be named said she favors the 6-month labor ban removal, recalling that she was out of work for 6 months because she quit her job before she could finish her two-year contract.
She was forced to go home and luckily found her way in again in Dubai through a sponsorship agreement with a relative. Now she is happily employed in another company.
Richard Batiquin, a visual merchandiser at a major outlet, said there are still some gray areas that must be cleared on the new labor policies. He said there are conflicting information passed around, such as certain categories of workers benefiting only.
Filipino lawyer Michael Barney Almazar, director at Gulf Law, explained there are basically two types of employment under the UAE Labor Code – the unlimited and limited.
“The rules on resignation, termination, end of service entitlement and notice period will depend on which type of contract an employee has,” explained Almazar, who regularly holds free legal aid seminars at the Philippine embassy in Abu Dhabi and the consulate in Dubai as a goodwill gesture to his fellow Filipinos.
Like others, Almazar welcomed the labor reforms in the UAE, specifically the policy that will thwart contract substitutions by recognizing the offer letter as basis of agreement between two contracting parties.
Article 120 of the UAE labor code provides the instances when employees can be dismissed outright, forfeiting any termination benefits:
1. If the employee adopts a false identity or nationality or if he submits forged documents or certificates.
2. If the employee is appointed under a probationary period and dismissal occurred during or at the end of said period.
3. If he commits an error causing substantial material loss to the employer provided that the latter advises the labor department of the incident within 48 hours from having knowledge of the same.
4. If the employee violates instructions concerning safety of the place of business, provided that such instructions are displayed in writing at conspicuous places, and in case of an illiterate employee, the latter be informed verbally of the same.
5. If he fails to perform his basic duties under the contract of employment and persists in violating them despite formal investigation with him in this respect and warning him of dismissal if the same is repeated.
6. If he divulges any secrets of the establishment where he is employed.
7. If he is awarded final judgment by the competent court in respect of an offense prejudicing honor, honesty or public morals.
8. If during working hours he is found drunk or under the influence of drug.
9. If in the course of his work he commits an assault on the employer, the manager or any of his colleagues.
10. If he absents himself without lawful excuse for more than 20 intermittent days or for more than 7 successive days during one year.
Article 121 provides that employees can terminate the employment at any time if:
- If the employer does not fulfill his obligations towards the employee as provided for in the contract or in this Law.
- If the employer of his legal regal representative has committed an act of assault against the employee.
Salient points of the new labor policies:
- A worker must be presented with an employment offer that conforms with the unified contract then signed by him or her as stipulated under MD 764 of 2015 on ministry-approved standard employment contracts.
- All contract renewals in force beforehand must use the new unified contract, in addition to the employment offer, the terms of which cannot be altered or substituted, unless approved by the ministry.
- No clauses can be added to any contract unless compliant with, and approved by, the labor ministry.
- MD 765 meantime stipulates that an employee contract, which covers not more than a two-year term can only be terminated if: 1) the term of the contract expires; 2) the employer and employee mutually agree to end the contract; 3) either party acts unilaterally to terminate the contract but complies with legal consequences of early termination, including notification in writing at least one month in advance and not longer than 3 months.
- A two-year contract can also be terminated if a worker commits violations prohibited under Article 120 of the Federal Labor Law.
- Non-term contracts can be terminated if: 1) both parties consent to termination; 2) one party gives notice of termination at least one month in advance and not exceeding 3 months; 3) if one party unilaterally acts to terminate but bears consequences of early termination.
- The non-term contract can also be terminated if an employee violates labor law rules under Article 120.
- Article 1 of MD 766 of 2015, which covers rules and conditions for granting a permit to a worker for employment by a new employer, stipulates that a new permit can be granted when both worker and employer mutually consent to terminate the contract during the term, provided that the worker has completed at least 6 months employment, or if workers qualify for a skill set series classified by the ministry.
- The same decree also notes that a new permit can be issued for a worker whose employer terminated him or her without reason, provided the worker has completed 6 months.
- The 6-month rule is waived if the worker has skill levels classified by the ministry as 1, 2, and 3, meaning those who hold a university degree, post secondary diploma, or high school diploma, respectively.
- Term contracts can be terminated with notice periods of between one and 3 months if the terminating party continues to honor contractual obligations for the term duration, or if the terminating party indemnifies the other party in the amount not exceeding the equivalent of 3 months’ gross wages.
- A worker may be granted a work permit for all term and non-term contracts if it is determined that the employer has failed to meet legal and contractual obligations, including but not limited to, when the employer fails to pay the worker’s wages for more than 60 days.
- A worker may also be granted a permit if the labor ministry confirms that the employing company has not provided work due to the firm being inactive for more than two months and if the worker reports to the ministry during the company shutdown.
- Work permits may also be issued in cases in which a labor complaint is referred by the ministry to the labor court and final ruling in favor of the worker, who is terminated early or is owed outstanding wages less than two months of dues for end of service.
Source: UAE Ministry of Labor