News and developments
The New DIFC Employment Law- What Has Changed?
Application of the Law:
- Art. 4(2) stipulates certain individuals who may be employed in the DIFC but subject to other applicable laws in their employment contracts, such as secondees and those employed in the DIFC by a local or federal government entity.
- Art. 4(3) extends the application of the New Law to those employees listed in Art. 4(2) – but only to some of the New Law’s provisions- including (but not limited to): employer’s general obligations under Part 7, certain provisions related to working times and rest periods, and general contraventions and penalties listed under Part 11.
- Employers will only be held liable for claims of losses, damages or compensation if the act/omission is sufficiently connected with the employee’s employment that it would be fair and reasonable to hold the employer vicariously liable.
- In cases of discrimination or victimization, if the employer is unable to show that it took steps that were reasonably practicable to prevent the employee from carrying out the act or omission, then the employer shall be liable. The employer’s vicarious liability has now been clarified, whereas no such limitations or distinctions were made under the Previous Law.
- Age and pregnancy/maternity are now included in the list of discrimination.
- Art. 60 has been included and forbids the victimization of an employee, specifically where the employer dismisses the employee or subjects him to a detriment if the employee brings proceedings under Part 9 (Non-Discrimination) of the New Law.
- Art. 61 provides that the burden of proof shall be on the complainant; a limitation period of 6 months is also imposed for bringing proceedings under Non-Discrimination, further provisions were included regulating the court proceedings for this section (Proceedings under Part 9).
- Art. 63 provides that employees who have been terminated for cause are now eligible to receive gratuity payments.
- Under the Previous Law, written reasons for terminated employees must be provided upon their request. The New Law requires employers to provide such statements within 14 days.
- The basic salary of an employee for the purposes of their gratuity shall not be less than 50%. No such divisions were included in the Previous Law.
- Under the Previous Law, employees could choose between a pension scheme and their gratuity. The New Law further clarifies that employees may agree to contributions from their employer into a pension scheme, retirement savings scheme or any substantially similar scheme, whether located in the UAE or elsewhere instead of gratuity. The New Law further states that such a scheme must not be less than the gratuity payment.