Over the past few weeks we have witnessed a number of key updates to the UAE employment law. In this round-up we provide insight into three important updates:
- Equal Pay;
- Parental Leave; and
- the DIFC's court decision on Covid-19 Rules
1. Equal Pay for Women
His Highness Sheikh Khalifa bin Zayed Al Nahyan, President of the UAE, has issued Federal Decree Law No. 6 of 2020 (the Decree) which amends Federal Law No. 8 of 1980 ("Labour Law") in two key respects.
The Decree amends the equal pay provisions of the Labour Law (Article 32) which previously provided that a woman's remuneration would be equal to a man's if she performs the same work. The amendment provides that a woman will now be paid the same wage for work of 'equal value'. The decree also provides for the UAE government (guided by the Ministry of Human Resources and Emiratisation) to issue a further resolution setting out the rules relating to the evaluation of work of equivalent value.
This amendment is a positive development for female employees in the UAE, consistent with the Government's and the Gender Balance Council's joint aim of promoting gender equality in the workplace.
2. Parental Leave
The Decree also provides parental leave applicable to male private sector workers for the first time. The Decree introduces a new Article 74 to the Labour Law providing 5 days of parental leave, to be taken within 6 months of the birth.
This change aligns the onshore entitlement to parental leave for new fathers to those applicable in the ADGM and DIFC freezones, which have their own employment laws.
And talking about the DIFC...
3. DIFC Court interprets DIFC Presidential Directive on COVID-19 emergency measures
In April, we wrote a blog post outlining the employment emergency measures (the "Emergency Measures") put in place in the Dubai International Financial Centre ("DIFC") in response to COVID-19 under Presidential Directive Number 4 of 2020 (the "Directive"). The Directive permitted employers in the DIFC during the "Emergency Period" of 21 April 2020 to 31 July 2020, to take Emergency Measures, which included (amongst other things) the imposition of unpaid leave and a reduction in remuneration on a temporary basis, without the consent of the employee.
On 25 August 2020, the DIFC Court, in Ludiana v Lucian Restaurant  DIFC SCT 222, has interpreted the Directive as practitioners had anticipated.
The Claimant was an employee working for the Defendant, a restaurant located in the DIFC.
The Claimant was employed by the Defendant in the position of 'housekeeping' under an employment contract dated 16 December 2019 with a monthly salary of AED 1,800.
On 1 April 2020, the Defendant gave notice to its employees that they would be placed on unpaid leave until further notice due to the outbreak of COVID-19. The Claimant refused to sign a document to agree to the Defendant's measure (although all other of the Defendant's employees did so, and agreed to go on unpaid leave).
The Defendant requested all employees to report back to duty in June 2020. The Claimant's salary was reduced to AED 1,500. The Claimant resumed working for the Defendant for 12 days in June, following which he did not attend work, alleging that there had been an unauthorised deduction of his salary.
The Claimant's employment was terminated and he was offered payment for the 12 days that he worked in June, reflecting the reduction in his monthly salary.
The Claimant filed a claim in the DIFC Courts' Small Claims Tribunal (the "SCT") claiming the sum of AED 5,400 which included payment for his monthly salary from April to June 2020, and compensation for the alleged exploitation of his visa. The Defendant justified its actions in response to the Claimant's claim by arguing that its actions were carried out in accordance with the Directive.
The SCT provided that the Directive permitted the employer to take measures, such as placing an employee on unpaid leave and reduced pay, without the consent of the employee in the period between 21 April 2020 and 31 July 2020.
As such, the SCT found that the Claimant was not entitled to any payment of salary during that period of time. However, as the Claimant did not consent to being placed on unpaid leave as of 1 April 2020 (i.e. before the Directive came into effect), the SCT found the Claimant to be eligible to be paid for the first 20 days of April.
From the period of 21 April 2020 however, the SCT found that the Claimant was not entitled to any payment of salary save for the 12 days he worked in June, reflecting the reduction in his monthly salary. The SCT dismissed the Claimant's claim for the remainder of the 3 months' pay and exploitation of his visa.
As the Claimant was found to be successful on some of his claims, the SCT ordered the Defendant to pay the DIFC Court fee.
The Emergency Period stipulated by the Directive ended on 31 July 2020 and has not been extended. We do not expect to see many cases in the DIFC Court arising out of the Directive, but the decision in this case reinforces our view and that of most practitioners as to how the Directive was intended to operate.
The Directive also allowed employers to defer the cancellation of visas of its terminated employees during the Emergency Period. There was some confusion among practitioners as to whether this meant that employers had the right to defer cancellation for an extended period for employees terminated during the Emergency Period. Though not the subject of DIFC Court proceedings, as far as we are aware, we understand that the deferral period is 28 days from the end of the Emergency Period for any employees terminated between 21 April and 31 July 2020, i.e. visas must be cancelled by 28 August 2020.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.