housing and rent

Can a tenancy contract be terminated before its expiry?

Landlord refusing to return businessman’s post-dated cheques

18:11 October 13, 2016

Last year, I rented a warehouse in Sharjah to set up a plastic factory. I signed a tenancy contract for five years and paid the rent with post-dated cheques. Now, my business is not doing well and I am unable to pay the rent. I have initiated procedures to close the company within three months. I requested the landlord to terminate the tenancy contract and return my cheques, but he refused and asked me to pay six months’ rent, or continue the contract. How do I terminate the contract? Can I file a case before the Sharjah Rent Committee? My bank account has insufficient funds to honour the cheques.


The questioner should send a notice to the landlord informing him that he is going to close the company due to financial problems and wishes to terminate the contract two months from the date of the notice. If there is no amicable settlement and the complaint is forwarded to the rental court, the court may terminate the tenancy contract after taking into account the circumstances of the questioner. The court may also direct the questioner to pay two months’ rent to the landlord to terminate the contract and get his cheques back.


Unlimited contract

I worked in a company in Dubai for more than six years on an unlimited contract. I have now resigned. My company is calculating my gratuity on the basis of 21 days for each year of service. It says I am not entitled to more because I resigned. My labour contract mentions a notice period of two months, but my employer has asked me to leave immediately. Do I have the right to ask for compensation for the notice period?


Article 137 of the UAE Labour Law states: “Where a worker who is bound by an unlimited contract leaves work of his own accord after continuous service of not less than one year and not more three years, he is entitled to one-third of severance pay. Where the continuous period of service exceeds three years, but not five years, he is entitled to two-thirds of severance pay. Where the continuous period of service exceeds five years, he is entitled to full severance pay.”

Regarding the notice period, if an unlimited labour contract is terminated by the employee, the employer is not obliged to pay compensation for the notice period in case he asks the employee to leave immediately.


Overdue salary

I own a company in Dubai. A worker has filed a case against me in the labour court claiming more than four months’ overdue salary plus end-of-service benefits although I have paid him his salary. Six months ago, he applied for annual leave to visit his home country for treatment. I paid him four months’ salary in cash so I have no proof. I am ready to pay him his end-of-service dues plus airfare. How can I prove in court that I have paid him? Will the court rule in his favour? He has also claimed three months’ compensation for arbitrary dismissal in the labour office saying that he was forced to submit his resignation.


The law obliges the employer to prove in court that he has paid a worker his salary. Therefore, the questioner has to request the labour court to ask the worker to take an oath with regard to the receipt of salaries. If the worker swears that he has not received the money, the court will rule in his favour. The questioner is not obliged to pay the salary of the worker during the case process as the obligation of the employer to pay the salary of the worker ends once the worker submits his resignation. Finally, in case the labour court rules in favour of the employee and finds that he did not receive his salary, the court might consider that the employee was forced to submit his resignation because he was not getting his salary for four months. Therefore, this type of resignation will be considered arbitrary dismissal. The court may then direct the employer to compensate the employee.


Questions answered by advocate Mohammad Ebrahim Al Shaiba of Al Shaiba Advocates and Legal Consultants.