The Dubai Court of Cassation on Monday ruled that employee total salary should be used in the calculation of gratuities, including all allowances.
This decision comes in light wherein an employee sought dues of upto Dh159,000 from his employer for arbitrary suspension. In his lawsuit, he asked for three months? salary as compensation for sacking him without notice, Dh11,000 as salary of the last month he worked, Dh22,000 as leave allowance and ticket to his home country and Dh82,000 as his end of service gratuity.
This verdict was upheld by two other courts, but the Court of Cassation accepted the appeal and asked for a new panel of judges to look into the case. Cassation Court is the third and superior degree of litigation in the Judicial System in the Emirate of Dubai.
The Court of Cassation observed: “The pay in accordance with the provisions of Article I of the Labor Law includes all that a worker receives as emolument, whether in cash or in kind, hence the gratuity should be calculated according to the entire amount received by a worker, including his monthly commission.?, as reported by Emirates 24|7.
?[This ruling] will open people?s eyes to what?s happening. I?m sure if they are asking for end of service, they will make sure to ask their lawyer?to claim for this,? said Walid Azzam from Dubai-based legal firm, Hadef & Partners.
?There are several courts?that consider if you are getting a regular commission on a monthly basis, this is part of your salary. A lot of construction companies, for example, give employees a small basic salary as well as a bonus that gets divided over twelve months,? he said.
This could mean bigger pay-offs by employers, if gratuity has to include other allowances in addition to the basic wage, much to the benefit of employees.
The case has definitely set alight a buzz among individuals across the emirate, as a ruling in favor of employees could mean a cautious move on part of companies in case of suspensions. Employees would not have to be uncertain about terminations, especially where there is a substantial difference between the basic and total salary, a large portion of the total wage being various allowances.
However, there have been discussions that allowances could generally mean the fixed monthly payments by the company and not fluctuating commissions.
ArabianGazette spoke to S.L., a salesman in Dubai, and he mentioned his doubts as to the effect this ruling could have on their profession. “I was thinking maybe this would not really matter in our case, as my salary is mostly commission based, and there is no fixed wage as such.”
Sources ? Dubaicourts, Emirates 24X7, Arabian Business