Employment & HR
Redundancy and restructuring
There is no separate statutory redundancy regime. It is termination with notice, which means the process is simpler and the exposure is entirely about how you do it.
The entitlement
What the law gives, regardless of contract.
UAE labour law does not provide a distinct redundancy process with consultation periods and statutory redundancy pay of the kind found in Europe. A role becoming surplus is a valid reason connected with the work, and the termination is effected in the ordinary way: written notice of the contractual period, full pay during it, and a final settlement comprising notice pay, accrued untaken leave, end-of-service gratuity and outstanding wages. There is no additional statutory redundancy payment on top.
That simplicity moves the risk elsewhere. Because there is no prescribed selection process, the exposure in a restructuring is that selection appears discriminatory or retaliatory — the employees selected are disproportionately of one nationality or gender, or include the person who recently filed a complaint, or a woman who recently returned from maternity leave. Termination for a reason unconnected with the work is arbitrary dismissal and attracts compensation. A documented, objective selection basis applied consistently is the whole of the defence, and it has to exist before the decisions are made.
The numbers
- Statutory regime
- None separate — ordinary termination applies
- Redundancy pay
- No additional statutory payment beyond gratuity
- Notice
- The contractual period, 30–90 days, with full pay
- Settlement
- Notice, accrued leave, gratuity, outstanding wages
- Main risk
- Selection appearing discriminatory or retaliatory
- Visas
- Must be cancelled; quota is released for future hiring
What it costs
Proportions indicative — they shift with visa count, premises and activity.
In practice
How this is actually administered.
- Document the commercial rationale firstBefore selecting anybody. A rationale written after the selection reads as written after the selection.
- Set objective selection criteriaRole, skills, performance record. Apply them consistently and record the application.
- Check the outcome for adverse patternsIf the selected group is disproportionately of one nationality, gender or includes a recent complainant, revisit it.
- Give proper notice and pay it in fullContractual period, full pay, and the complete final settlement.
- Cancel visas and dependants properlyDependants first, then the employee. Uncancelled visas leave the company carrying liabilities and occupying quota.
Related
Questions
No. A redundancy is an ordinary termination — notice, accrued leave and end-of-service gratuity, with no additional statutory redundancy payment.
There is no prescribed consultation process, but a documented objective rationale is the practical protection against an arbitrary dismissal claim.
It is a significant exposure. Selection that captures an employee on protected leave invites a finding that the reason was unconnected with the work.
Cancelling the visas releases the quota, which is available for future hiring.
One question
How many people are on the payroll?
Then the order matters. Establishment card, then quota, then work permit, then entry permit, then medical, Emirates ID and contract registration. Skipping ahead to a signed offer letter before the quota exists is the usual way a start date slips by six weeks.
The first hire, in orderOr just ask usThis is the size where informal arrangements start costing money — salaries paid partly outside WPS, leave that was never tracked, gratuity nobody has accrued for. None of it is hard to fix now and all of it is expensive to fix at a MOHRE hearing.
What you are accruing without knowingOr just ask usThen Emiratisation quotas, WPS timing, ILOE subscriptions and health insurance renewals are running on separate calendars, and the penalty for each is levied per employee. Consolidating those dates is usually worth more than any single piece of advice.
What gets inspectedOr just ask us