Termination Rules, Notice Periods, and Final Settlements in the UAE (2025 Guide)

Ending an employment relationship in the UAE — whether through resignation, redundancy, or termination — must be handled carefully and in full compliance with Federal Decree-Law No. 33 of 2021 (UAE Labour Law). 

The law outlines strict rules around notice periods, reasons for termination, and final payments, ensuring fairness to both employer and employee. 

This guide explains how termination works, what notice you must give, and how to calculate the final settlement correctly. 

Types of Termination 

Termination by Mutual Agreement 

Both parties agree in writing to end the contract before expiry. 

Resignation by the Employee  

An employee resigns voluntarily by serving the contractual notice period (30–90 days). 

Termination by the Employer 

An employer may terminate an employee with notice for legitimate reasons such as: 

• Poor performance 

• Redundancy 

• Business closure or restructuring 

• Violation of company policy 

Termination Without Notice (Immediate Dismissal) 

Permitted only in specific cases listed under Article 44 of the Labour Law — for example: 

• Forging documents 

• Disclosure of confidential information 

• Physical assault at work 

• Repeated absence without valid reason 

Notice Period Requirements 

The UAE Labour Law mandates a minimum notice period of 30 days and a maximum of 90 days, regardless of who initiates termination. 

Employment Type	Minimum Notice	Maximum Notice
Permanent / full-time	30 days	90 days
Part-time / flexible	Pro-rata based on hours	90 days

Key Points 

• Notice must be in writing. 

• The notice period counts toward service for gratuity purposes. 

• Either party can waive notice by paying compensation equal to the salary for the notice period. 

End of Contract vs Dismissal 

Scenario	Treatment
End of limited-term contract	No automatic renewal unless both agree. Employee entitled to gratuity + unused leave.
Termination before contract end	Must give notice or pay in lieu. Unlawful termination may result in compensation up to 3 months’ salary.
Termination for misconduct	No notice or gratuity if proven under Article 44.

Resignation Rules 

Employees can resign at any time by giving proper notice.
During the notice period: 

• The employee continues to work and receive salary. 

• The employer can waive or shorten the notice period by paying salary in lieu. 

• The employer cannot withhold the employee’s passport or visa as leverage. 

Resignation Rules 

Employees can resign at any time by giving proper notice.
During the notice period: 

• The employee continues to work and receive salary. 

• The employer can waive or shorten the notice period by paying salary in lieu. 

• The employer cannot withhold the employee’s passport or visa as leverage. 

Final Settlement Obligations 

Once the employment ends, employers must prepare a Final Settlement (End of Service Payment) within 14 days. 

The final payment includes: 

• Unpaid salary or overtime
• Payment for unused annual leave
• End of Service Gratuity (EOSB)
• Commission or bonus (if contractually agreed)
• Repatriation ticket (if applicable) 

Deduct only if: 

• There are approved loan deductions 

• Company property or advances are outstanding 

• Fines or disciplinary deductions are authorised by MOHRE 

All deductions must be documented and supported by written proof. 

Visa Cancellation 

Employers must cancel the employee’s: 

• Work permit (through MOHRE or Free Zone portal) 

• Residence visa (through the Federal Authority for Identity & Citizenship) 

The process must be completed within 30 days of the employee’s final working day.
Visa cancellations are free of charge for the employee and handled entirely by the employer. 

Experience Certificates 

Upon termination or resignation, employers are legally required to issue a service certificate free of charge.
The certificate must include: 

• Employee’s name 

• Duration of employment 

• Job title and description 

• Last salary drawn (if requested) 

This helps the employee apply for new jobs or visa transfers.