- Unlike during Covid, no ministerial resolution has been issued for this current conflict so all existing labour laws apply
- Can an employer terminate employment for reasons force majeure? Article 273 of the UAE Civil Transactions Law (Federal Law No. 5 of 1985) – only if an unexpected event renders contractual performance impossible. However, an employer cannot simply terminate you under force majeure as the employer has to demonstrate impossibility (high threshold) and not mere difficulty or increased costs. To illustrate, UAE courts consistently held that reduced profitability in business did not constitute force majeure as contracts were not impossible to perform. The Dubai Court of Cassation reinforced that an employer would have to demonstrate that the inability to perform the contract is a direct consequence of the conflict (the force majeure event) and does not merely coincide with it. So, an employer giving the force majeure excuse is a weak basis for termination. The force majeure threshold would probably be met if the business closed permanently as a direct consequence of the conflict – this would be a valid ground for termination. Note that permanent business closure is also a valid ground for termination under Article 42 of Federal Decree law No. 33 2021. Under Article 42, the employer still needs to give notice period, gratuity, leave etc.
- Employers may also seek to rely on Article 249 (exceptional circumstances whereby performance is not impossible but has become onerous, threatening grave loss) – if exceptional circumstances apply, the contract continues but the court will adjust the contract (e.g. reduce pay) – only the court can declare whether there has been as exceptional circumstance. The court will do a balancing act taking into consideration the interests of both parties.
- What if the employer is reducing pay/force me to take unpaid leave because of the conflict? If your employer reduces your salary without your written consent, the employee can file a complaint with MOHRE through WPS as this will show the evidence of the violation. The same provision applies to forced unpaid leave under Federal Decree-Law No. 33 of 2021 – in that there must be written agreement by the employee.
If you are facing employment challenges due to ongoing conflict or changes in your workplace conditions, it’s important to understand your rights under UAE law. Our employment law services provide clear, practical guidance tailored to your situation.
Get in touch with James Berry and our expert legal team today to discuss your case with confidence.
Managing Partner