For corporate bodies and investors setting up their footprint in the UAE, mastering every nuance of the UAE Labour Law is of utmost importance. The probationary phase acts as a critical window for evaluation, permitting businesses to ensure complete tactical alignment and operational brilliance when it comes to new hires.
Officially governed by Federal Decree Law Number 33 of 2021, which was enforced on 2nd February, 2022, this specific period is highly regulated in order to safeguard the interests of both the entity as well as the workflow.
Properly understanding these regulatory frameworks is of major importance when it comes to smooth corporate governance and mitigation of threats. Here is an in-depth breakdown of the all the statutory requirements that surround probation period in UAE:
Maximum Duration & Extension Rules
As per the law of the United Arab Emirates, the probation period is not permitted to exceed a maximum of 6 months from the actual commencement date of the employee.
- Organizations possess the flexibility to agree on a trial period that is shorter, like 3 months, but any addition or extension beyond the threshold of 6 months is deemed unlawful.
- An employer is not allowed to place an employee on probation more than a single time.
- If an employee completes the period successfully and continues in their respective role, the contract becomes completely valid, and the time of probation gets counted towards overall continuous service.
To ensure total compliance from the very first day, accurate Document Drafting & Document Attestation is crucial. Making sure that the initial Letter of Employment clearly outlines the mentioned terms prevents any type of future operational friction.
Employer Initiated Termination
During the period of probation, an employer maintains the authority to terminate the relationship of employment without proving particular performance grounds, given they abide by the statutory notice requirements.
- The employer must formally issue a written termination notice at least 2 weeks (14 Days) before the stated date of termination.
- If an employer does not succeed in observing the official notice period, they are obligated legally to fully compensate the employee with the same amount as the employee’s wages for the missed notice period’s duration.
- Instant termination without notice is only allowed under intense circumstances, like a contract breach or gross misconduct.
Employee Resignation & Notice Periods
The law clearly outlines distinct protocols based on the intentions of an employee upon resigning during their period of probation.
- Leaving the United Arab Emirates: If an expat worker resigns with the sole intention to leave the UAE, they are required to give the employer a minimum of 2 weeks or 14 days of previous written notice.
- Shifting to a Different UAE Employer: If the employee has the intention of transferring to another UAE firm, they are required to give their current UAE employer within a formally-written 30 days or 1 month notice period.
- Recruitment Cost Compensation: In the case an employee shifts to a new UAE employer during their probation period, or returns to the country on a brand new work permit within 3 months of departing, the new UAE employer is obligated to compensate the previous (original) employer for every recruitment and contract expense, unless a distinct mutual agreement exists.
- Breach Penalties: Leaving the United Arab Emirates without serving the compulsory notice period can lead to MOHRE (Ministry of Human Resources and Emiratisation) imposing a 12-month or one-year ban on labor. Exceptions to this ban exist for certain categories, like UAE Golden Visa Holders or those backed by Family Sponsorship.
Statutory Leaves During Probation Period
Handling leave entitlements properly during the initial 6 months period is a crucial component of Governance & Compliance.
- Sick Leave: Employees are not officially entitled to pay such leaves during the period of probation. If an illness occurs, the employee mandatorily needs to report it within a period of 3 working days and a recognized medical report, and the employer might opt to grant, at their discretion, unpaid sick leave.
- Other Leaves: As opposed to a sick leave, statutory bereavement leave (3-5 days based on the relation) and parental leave (5 days within 6 months of birth) are fully applicable from day one of employment, including the phase of probation.
- Annual Leave: Employees might leverage their accrued yearly leave during the period of probation, but this stays strictly subject to the approval of the employer.
EOS (End-of-Service) Gratuity Implications
A very common misconception that surrounds the payout of EOS advantages for short-term tenures. As per the UAE Labor Law, an employee terminated/resigned during the period of probation is not entitled to any EOS gratuity.
To officially qualify for gratuity, an expat worker is required to complete at least a year of continued service with the exact same employer. Should the employee go through the probation period and stay with the firm, the initial period of 6 months will get factored into the total gratuity calculation when they depart eventually.
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Frequently Asked Questions (FAQs)
Q. What is the maximum duration for a probation period in the UAE?
A. The UAE probation period cannot go beyond six months from the commencement work date of the employee. It cannot get extended beyond this specific limit, nor can it get repeated with the same employer.
Q. Is an employee entitled to paid sick leaves when serving the probation period?
A. As per the UAE Labor Law, employees are not entitled to any paid sick leave during their period of probation. However, an employer might grant unpaid sick leaves at their own discretion if they get an authentic medical report.
Q. Who pays the costs of recruitment if any employee changes jobs during their probation period?
A. If a UAE employee resigns from a job to join another firm within the UAE during their probation period, the new UAE employer is legally obligated to reimburse the previous (original) employer for the initial recruitment as well as contracting expenses, unless otherwise agreed upon.
