# Unlimited Employment Contract in Free Zone - Dubai



## neeleshgupta8480 (Sep 2, 2011)

Hi friends,

I have a Unlimited Employment Contracts (maximum two years) with free zone company in DAFZA, dubai,

I have complied 16 months in my job,

I am going to submit my resignation since i got a job out side free zone...

*Now Kindly advice:*
*
* will i get any ban by my current employer?

* do I have to give 45 days salary to my current employer since i have not completed 2 yrs?

* How would my gratuity / End of Services benefits would be calculated?*

I was wondering if someone can provide the insight into the advantages / disadvantages of unlimited employment contracts in Dafza / Dubai. 

many thanks in advanced....


----------



## zin (Oct 28, 2010)

As far as I'm aware the 2 year rule doesn't apply to freezones. It's much easier to move companies if you are working in a freezone and want to work outside a freezone. Hopefully someone will be able to provide more information.


----------



## katiepotato (Apr 29, 2008)

Hi there,

Zin is right - the rules regarding bans do not apply to Free Zones. They actually do not uniformly apply for onshore visas either following a change in the law earlier this year, but the impact of the change is quite complicated so I won't go into it here!

To answer your questions:



neeleshgupta8480 said:


> * will i get any ban by my current employer?


No, as above you will not get a ban



neeleshgupta8480 said:


> * do I have to give 45 days salary to my current employer since i have not completed 2 yrs?


As you are on an unlimited contract, you do not need to pay any compensation for ending it. All you need to do is give the required period of notice. 



neeleshgupta8480 said:


> * How would my gratuity / End of Services benefits would be calculated?


As you are resigning before completion of three years' service you are entitled to 1/3 of the total gratuity payment you have accrued up to your final date of employment. So, if you started work on 1st May 2010 and leave on 30th September 2011, you have accrued a total of 30 days' gratuity. To comply with the law your employer must include 10 days gratuity in your final settlement. 

Your final settlement should also include payment for any untaken annual leave. Annual leave pay should include basic salary plus allowances and should be calculated on the basis of your contractual working hours - so if you work five days per week then one day's leave pay is 1/260th of your annual salary. I only point this out as I have known companies attempt to calculate a daily rate of salary on the basis of annual salary divided by 365 - but very few of us are contracted to work 7 days a week, 52 weeks a year.... 

Good luck with your new job!

KP


----------



## neeleshgupta8480 (Sep 2, 2011)

thanks for your reply & help.

My employer is deducting x amount of my basic salary of 45 days, as i have not completed 2 yrs under unlimited contract,

As per my employer, If anyone resign before 2 yrs (under Limited Contract) he/she has to pay back 45 days of his salary calculated on his/her gross salary,

But

If anyone resign before 2 yrs (under Unlimited Contract) he/she has to pay back 45 days of his salary calculated on his/her basic salary,

Kindly clarify my doughts & advice accordingly...

Many thanks in advance...


----------



## dizzyizzy (Mar 30, 2008)

have you tried taking a copy of your contract to the DAFZA authority and asking them directly? That's the best way to get your answers you need.


----------



## Gavtek (Aug 23, 2009)

I'm pretty sure that as long as you work your notice period, you shouldn't receive any deductions.


----------



## katiepotato (Apr 29, 2008)

Under labour law, the requirement for compensation for early termination is only specified for limited contracts. Unlimited contracts have no fixed end date, so it would be impossible to end them early! As long as you have given the required notice period you should not be required to pay compensation. 

Unless your employer added a clause to your contract to state that you must pay them compensation when you leave, and you subsequently signed the contract, then they do not have legal grounding to pursue compensation from you. However, as we all know, that does not necessarily stop them from trying.... 

Best of luck


----------

