Do You know under which Employment Contract you are working?
Do you the benefits of Your Employment Contracts?
If your answer is NO, then don't worry, becuase this Article will briefly describe the Types and difference between Employment contracts that are allowed in all states of United Arab Emirates.

There are 2 Types of Contracts using all over UAE.

1. Limited Employment Contracts.

2. Unlimited Employment Contracts.


Limited time contracts also known as fixed term contracts which are using for specified duration with listed beginning and completion dates. 

Please read below characteristics of Limited Employment Contracts:

1. Limited Employment contracts have specific duration (starting and Completion dates).
2. It can be renewed through mutual agreement.

3. If not renewed by mutual consent the employment will terminate at the end of contract period.

4. Employer (company) will pay compensation (determined on the basis of wages)to  the employee (worker) if employer terminates the contract except for the LAW specified in Article 120 (See Page 25 for Article 120).

5. If Employee (worker) terminates the contract for reasons other than those written in Article Number 121 of UAE Labour Law then employee (worker) will pay compensations to the company (employer).  

6. If Employee cancelled the employment contract, the compensation will be determined on the basis of employee’s salary for one month and a half.


Unlimited Employment Contracts where the employee (worker) continues his/her work for company (employee) from a specific time (date) as the agreement or contract is terminated by first or second party after giving prior notice. 

Below are the characteristics of an unlimited (limitless) Employment Contracts:

1. Unlimited contracts include commencement (beginning) date only.

2. This contract will be considered unlimited if:
A. It is not for a specified period. 
B. It is an oral contract.
C. It was for a specified period but both parties continued to act on its Terms & Conditions after its expiry date, without specifying the ending date of contract.

3. The Unlimited contract may be cancelled by mutual agreement or by either of the parties providing a minimum of thirty (30) days’ notice of termination.  

4. Thirty (30) days’ notice period may be extended for exceeding period. It would then not be acceptable for both partied to waive notice period.

5. Wages of the employee’s should be paid full for the entire notice period he/she served.

6. Employer (company) is able to terminate the Unlimited Employment Contract without any notice if employee (worker) violates any provisions of UAE LABOUR Law written in Article 120.

7. Employee (worker)have right to terminate the Unlimited Contract without any notice if the conditions listed in UAE LABOUR LAW Article 121 are applicable. 
8. f the termination of the Unlimited Contract was for an unjustified (unfair) cause the Employee will be entitled compensation.
9. The court may grant the employee (worker) damages against the employer, provided the damages that awarded do not exceed 3 month’s wages.
10.Wages will calculate on the basis of last salary paid to the employee (worker).

Below information to be written in an Employment contracts by UAE LABOUR LAW:

1. Nature of Contract (Limited or Unlimited)

2. Nature of the work.

3. Remuneration/Wages Payable.

4. Duration of the Contract (for limited term conditions).
5. Date of the employment contract.
6. Date of the commencement of Employment Contract.
7. Position of the Employment contract.
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