UAE Employment contract details

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UAE Employment contract details


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Old 20th April 2011, 12:05 PM
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Default UAE Employment contract details

Hello,

Finally I have finished negotiating my Dubai package. I haven't received the offer in writing yet, but met with the company board of directors yesterday to iron out the details. Compensation, bonus, etc. is set...but I have a few questions on typical executive level contract wording to expect.

First, what is the standard vacation packages? Just looking for number of days...seems to be typical at 30 days a year, plus the bank/religious holidays. Is this typical?

Second, I am trying to understand the End of Service entitlement. From what I have found on the forum, there are some discrepancies. I am right to understand that after year 1 though year 5, you accrue 21 days per year...and from 6 years on it is 30 days? Maximum to 2 years of salary. Is this to be written into the contract or is this inferred due to employment law? I want to make sure I am covered on this point.

I negotiated everything like accommodation, plane tickets, etc. into base salary instead of separated out. Any pro's or cons to that?

Any difference to speak of between a contract based in Abu Dhabi vs. Dubai being different Emirates?

I am sure I will have more questions come to mind, but some clarifications on these points would be helpful.

Thanks in advance!

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Old 20th April 2011, 12:20 PM
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Quote:
Originally Posted by xchaos777 View Post
Hello,

Finally I have finished negotiating my Dubai package. I haven't received the offer in writing yet, but met with the company board of directors yesterday to iron out the details. Compensation, bonus, etc. is set...but I have a few questions on typical executive level contract wording to expect.

First, what is the standard vacation packages? Just looking for number of days...seems to be typical at 30 days a year, plus the bank/religious holidays. Is this typical?

Second, I am trying to understand the End of Service entitlement. From what I have found on the forum, there are some discrepancies. I am right to understand that after year 1 though year 5, you accrue 21 days per year...and from 6 years on it is 30 days? Maximum to 2 years of salary. Is this to be written into the contract or is this inferred due to employment law? I want to make sure I am covered on this point.

I negotiated everything like accommodation, plane tickets, etc. into base salary instead of separated out. Any pro's or cons to that?

Any difference to speak of between a contract based in Abu Dhabi vs. Dubai being different Emirates?

I am sure I will have more questions come to mind, but some clarifications on these points would be helpful.

Thanks in advance!
You need an employment lawyer or HR bod to answer some of those questions - way to technical for me..

30 days holiday sounds about right but depends how they deal with weekends.

Make sure everything you agree gets covered in the contract! Don't accept them leaving things out or telling you that you have to use a standard form labour contract. You need a separate, more detailed contract to cover everything, in addition to the 1 or 2 page standard form government labour contract.

No harm with you negotiating flights, accommodation etc into the lump sum salary you'll receive. That's the position most of us are in as the days of employers paying loads of allowances on top of salaries are long since dead in most job sectors..

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Old 20th April 2011, 12:21 PM
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Quote:
Originally Posted by xchaos777 View Post
Hello,

Finally I have finished negotiating my Dubai package. I haven't received the offer in writing yet, but met with the company board of directors yesterday to iron out the details. Compensation, bonus, etc. is set...but I have a few questions on typical executive level contract wording to expect.

First, what is the standard vacation packages? Just looking for number of days...seems to be typical at 30 days a year, plus the bank/religious holidays. Is this typical?

Second, I am trying to understand the End of Service entitlement. From what I have found on the forum, there are some discrepancies. I am right to understand that after year 1 though year 5, you accrue 21 days per year...and from 6 years on it is 30 days? Maximum to 2 years of salary. Is this to be written into the contract or is this inferred due to employment law? I want to make sure I am covered on this point.

I negotiated everything like accommodation, plane tickets, etc. into base salary instead of separated out. Any pro's or cons to that?

Any difference to speak of between a contract based in Abu Dhabi vs. Dubai being different Emirates?

I am sure I will have more questions come to mind, but some clarifications on these points would be helpful.

Thanks in advance!
1. Don't know anything about the vacation as I assumed companies mandate that, but I think someone that has been here longer can give you the right answer. But your numbers do appear to be in line with what I heard and most people get in the region.
2. I think the others can let you know about the End of Service accrual. I think it has been explained a few times here before, so maybe do a search if no one chimes in.
3. I would not have negotiated the accommodations into base salary. It would be a lot easier for your company to deal with that crap and hassle. By doing that, you have to come up with the deposit, down payment, and the year up front rents, which is not a big deal, but having the company deal with it would make life so much easier (especially when dealing with the utility companies here and the shady ass landlords and agents). If you don't foresee huge price increases in the ticket fares or think you can book them yourself cheaper, then that was a good call. Vehicle and Furniture is completely up to you as you and I would have done the same.
4. Abu Dhabi is more expensive to live in and thus they would probably give you slightly higher allowances. Parking is a b!tch though.

Good Luck.

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Old 20th April 2011, 12:42 PM
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Thanks for the input.

The plane tickets had a cap...I just put that into the monthly.

On accommodation, I did the same thing. However, they will pay one year in advance and thus reduce the actual monthly by that amount...basically like a loan and no interest if I decide I want it. Contract will stay state full salary.

There is also a relocation bonus on signing for moving expenditures, etc. They will pay actuals or lump sum amount...my call. I will price some of that out to decide.

I did look for the End of Service information here...and have seen a few different numbers on how it is calculated. Everything from 7 days per year for the first 5 years...to 21. Seems 21 is more prevalent in the threads but hope to clarify.

For Abu Dhabi vs. Dubai...I am wondering if there is any difference in employment law. I suspect not, but there is discussion on which Emirate the employment contract will be based.

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Old 20th April 2011, 12:58 PM
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Here's a link to a piece I wrote on another forum. It is the second posting from the top and covers what the official labour contract contains, what it looks like and the implications on variations in the contract.

Please note, it is mentioned above about negotiating a second - perhaps broader contract, while this is okay in theory if it is not appened to or specifically covered in the "official labour contract" - the English/ Arabic one - it is not enforcable under UAE law - which is the only law that is used in mediation or arbitration in the UAE.


Sorry, message me and I'll forward the link. The site will not allow me to post the link until I have posted a certain amount of answers

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Old 20th April 2011, 01:06 PM
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Would like to see the info. You will have to post 5 times before you can PM.

Thanks!

Old 20th April 2011, 01:09 PM
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Old 20th April 2011, 01:13 PM
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The End of Service Entitlement is 21 days if your contract is terminated by your employer, or 7 days if you resign. It is UAE Law so it doesn't need to be in your contract. Just make sure there isn't any clauses in the contract to try and get round it.

The Entitlement is based on your base salary so if you have negotiated that all your allowances will be included in this, you'll receive a larger amount at the end of your employment. It will also be easier to get credit, etc.

I had difficulty getting the credit card I wanted because my employer takes care of my housing, etc, so they only took into account the actual amount that was credited to my bank account, not the value of my salary. If I paid my own rent, then I would have been able to get the card despite being no better off. Don't expect logic to apply here. Ever.

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Old 20th April 2011, 01:17 PM
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Thanks Gavtek. Good info and now I see the difference. I will watch for that in the contract.

That was exactly what I was thinking for the salary. Not that I will necessarily use the credit, but know that this will look better for many different reasons.

Old 20th April 2011, 01:17 PM
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Old 20th April 2011, 01:20 PM
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Hi dbxsoul, I think the intent of this rule is just to keep the forum from filling with useless info. I think it is a good policy, and if I remember correctly you are only one post from PM. I am sure the information is useful for others on here as well.

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Old 20th April 2011, 02:45 PM
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Gratuity

The rules and regulations regarding gratuity or end of service dues are covered under articles 133 through 140.

In brief it provides for an end of service amount to be paid to a loyal employee at the culmination of his/ her contract. There are obviously a number of provisos set into the law.

The most important to bear in mind when you are a new employee and negotiating a contract is that the gratuity amount is calculated and paid according to the last BASIC salary amount. In your labour contract you will see two sections under salary, the first being the basic salary and the second amount the Dirham value of the "perks"portion of the salary - in otherwords the portion of the salary that is made up of allowances (accomodation, vehicle, mobile etc).

From an employers perspective you offer a low basic and make up the difference in allowances - this means at the end of the employees service he will recieve a much lower gratuity and the company saves money. Something to bear in mind.

The formula's for calculating end of service dues are laid out in the regulations and vary according to: the type of contract that you enter into (limited or unlimited), the final duration of the contract and the reasons that the contract is ended/ terminated.

of course it also makes provision for the non-payment of gratuity due to any criminal offences (under article 120 of the Labour Law).

If you wish I am more than happy to post the formulations for the gratuity payments - well worked examples in anycase.

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