Unlimited Contract in UAE

We posted an article on what is a Limited Employment Contract, so now let’s try to understand the other type which is an Unlimited Contract.

Simply put, an Unlimited labour contract is an employment agreement which does NOT have an expiration date.

An Unlimited term contract is more employee-friendly compared to the limited term contract because it is more flexible. These are used for long-term employees and seems more ‘permanent’. Both parties can cancel the contract so long as there is a mutual signed agreement and there is a notice of 30 days.

Related Post: Difference Between Limited and Unlimited Contract in UAE Labour Law

What is an Unlimited Employment Contract?

According the Ministry of Labour, the unlimited ones only specify joining dates, each follow respective provisions depending on the situation.  The worker must inform the employer if he/she plans to resign and must complete the assigned notice period.

Based on our experience, Unlimited contracts are a much better option for employees as it is more open especially in terms of gratuity. Here’s a clause we have taken from the UAE Labour Law.

Gratuity in Unlimited Contract

ARTICLE (137) of FEDERAL LAW NO. (8) OF 1980

If an employee under a contract with unlimited period has left his work at his own option after a continuous service of not less than one year and not more than three years, he shall be entitled to one third of the end of service gratuity provided for in the previous Article.

If the period of his continued service is more than 3 years and less than 5 years he becomes entitled to 2/3 of the said gratuity, but if his continued service exceeds 5 years, he becomes entitled to the entire gratuity.

Don’t know what type of contract you hold? Here’s a guide how to check your Labour contract online.

REMINDER: Before signing you contract, please read it carefully and discuss it with your employer if you have questions/clarifications.

Note: Information posted above is only a guide. It is good to seek legal counsel or contact the UAE Ministry of Labour for inquiries regarding your specific case. For a full coverage of the UAE Labour Law, it is best to visit the Ministry of Labour website and read the document. You can check it out here – UAE Labour Law

Helpful Articles Regarding UAE Labour:


We're on YouTube!
Please subscribe to the Dubai OFW YouTube Channel for updates and tips!


Get FREE Dubai Updates by entering your email address:



Don't forget to check your email to activate your subscription!

ALSO READ

UAE Announces New Penalty for Companies that Don’t Pay Salaries on Time

The Ministry of Human Resources and Emiratisation (MoHRE) has introduced a new penalty for private sector companies that don’t pay salaries to their employees...

10 Real-life Scenarios in Pinoy Movie ‘Love or Money’ about Being an OFW in Dubai

Are you looking for a film where you can watch, cry or relate to as an OFW? Then Love or Money, a Filipino...

Proudly UAE: Gov’t Introduces New ‘Hayat-Vax’

UAE residents will soon have access to a UAE-manufactured vaccine against coronavirus disease (COVID-19), following the launch of a joint project between the UAE...

PH Bureau of Immigration Issues Warning to OFWs: Using Old OECs is Illegal

The Bureau of Immigration (BI) issued a warning about a scam targeting former OFWs. The scheme works by giving former OFWS new tourist visas...

OFW Interview with Elle Gayle, Assistant Accountant and 17 Years in Dubai

For today's OFW interview, I interviewed Elle Gayle Pepito, a 23-year old Filipina aspiring accountant in Dubai. A graduate of Bachelor of Science in...