Arbitrary Dismissal UAE: Compensation and Rights
Under Article 47 of the UAE labour law, if your employer fired you without a legitimate work-related reason, you are entitled to compensation of up to 3 months gross salary — on top of your end-of-service benefits. Here is how to claim it.
What Article 47 Says
"If the dismissal of the worker is arbitrary, the court shall order the employer to pay a fair compensation to the worker, which shall be assessed by the court. The amount of compensation shall not exceed the wage of the worker for a period of three months, calculated on the basis of the last wage the worker was entitled to."
— Federal Decree-Law No. 33 of 2021, Article 47
When Dismissal Is Considered Arbitrary
The court will consider a dismissal arbitrary if the reason is not related to work. Common scenarios:
No reason given
Employer terminated you without providing any reason or documentation
Retaliation
Fired after filing a labour complaint, reporting safety issues, or requesting owed wages
Personal reasons
Dismissed due to personal conflict with management, not work performance
No warnings
Fired for alleged poor performance but without prior written warnings
Timing is suspicious
Terminated right before end-of-service benefits vest or contract bonus is due
Discrimination
Dismissed due to nationality, gender, pregnancy, religion, or disability
How Compensation Is Calculated
The 3-month cap is the maximum. The court considers these factors when determining the actual amount:
- Length of service — longer service generally means higher compensation
- Nature of the work — specialized roles may receive more
- Severity of the employer's conduct — retaliatory dismissal tends to get maximum awards
- Financial impact on the employee — difficulty finding new employment is considered
- Whether the employer followed any proper procedures at all
Example Calculation
Employee with AED 15,000/month gross salary, 4 years service, terminated without reason:
Arbitrary dismissal compensation: Up to AED 45,000 (3 months x AED 15,000)
+ End-of-service gratuity: AED 42,000 (21 days x 4 years based on basic)
+ Notice period: AED 15,000 (1 month if not served)
+ Unused leave: Calculated based on accrued days
Total potential claim: AED 100,000+
How to Claim Compensation
Gather evidence: termination letter, no warning letters, complaint records, communications
File a complaint with MoHRE within one year of your termination date
At mediation, clearly state you are claiming arbitrary dismissal under Article 47
If mediation fails, the case goes to labour court
At court, present your evidence that the dismissal lacked work-related justification
The employer must then prove the termination was legitimate — if they cannot, the court awards compensation
Calculate What You Are Owed
Upload your employment contract and we will calculate your potential claim — including Article 47 compensation, gratuity, notice pay, and leave encashment.
Check Your ContractFrequently Asked Questions
What is arbitrary dismissal under UAE law?
Under Article 47 of Federal Decree-Law No. 33 of 2021, dismissal is considered arbitrary if the reason for termination is unrelated to work performance. Examples include termination for filing a labour complaint, for personal reasons, or without any genuine business justification. The court assesses whether the employer had a legitimate, work-related reason for the dismissal.
How much compensation for arbitrary dismissal in UAE?
The court can award compensation of up to 3 months gross salary. The exact amount depends on factors like length of service, the nature of the work, and the circumstances of the dismissal. This compensation is in addition to end-of-service benefits, unpaid wages, notice period pay, and leave encashment.
Is the 3-month compensation cap based on basic or gross salary?
Article 47 specifies compensation based on the employee's wage, which courts have interpreted as gross salary (basic + allowances). The 3-month cap is the maximum — the court may award less based on the specific circumstances. However, this is separate from other entitlements like gratuity and notice period pay.
How do I prove arbitrary dismissal?
You need to show that your termination lacked a legitimate work-related reason. Evidence includes: no prior warnings or performance issues, termination shortly after filing a complaint, no documented reason for termination, or evidence of personal animosity. Once you show the dismissal appears arbitrary, the burden shifts to the employer to prove it was justified.
What is the difference between arbitrary dismissal and illegal termination?
Illegal termination violates a specific law (e.g., firing during maternity leave or in retaliation for a complaint). Arbitrary dismissal is broader — it covers any termination that lacks a legitimate work-related reason. You can claim both if applicable, but the compensation cap for arbitrary dismissal is 3 months salary under Article 47.