UAE Employment Termination Entitlements | Former Nakheel CEO Awarded $3m By DIFC Court

Former Nakheel CEO, Chris O’Donnell, was recently awarded $3.25 million, including $3 million in two unpaid annual bonuses and 54 days of paid leave, amounting to almost AED 850,000. Nakheel was also told to pay for the former CEO’s business class flights back to Australia — at a cost of AED 67,000. Read more about Nakheel’s former CEO’s win of $3m claim against developer.

In the current economic climate, many employers are likely to be faced with the challenge of reducing operating costs and inevitably redundancies will be on the agenda. However, both employers and employees need to be aware of mandatory termination entitlements that an employee is entitled to at the time of termination of employment.

Termination entitlements comprise of the following:

  • salary and allowances to date;
  • salary payment in lieu of notice (if applicable);
  • payment in lieu of any untaken annual leave;
  • end of service gratuity, pursuant to the relevant employment law pre-conditions;
  • accrued pension fund rights, if any;
  • contractual benefits (for example bonus payments, accrued commission payments); and
  • statutory right to air tickets.

It should also not be forgotten that in the Dubai International Financial Centre (DIFC) a separate legal regime applies, and employment relationships are governed by the DIFC Law No. 4 of 2005 and not the UAE Labour Law. Diaz Reus provides practical advice on domestic and international matters to employers and senior employees.  The firm prides itself on its ability to provide complex advice in a clear, concise and uncomplicated manner, keeping in mind the commercial needs of our clients.