The UAE law known for its accurate amount of strictness towards us does need to meet the awkward end where external agencies need to be squeezed in. This is highly avoidable to make the world a better place.
Most people who land up facing (or running from) the Interpol do so with a substantial amount of embarrassment awaiting to catch up. This can be avoided with ease should the person in doubt, soon to become defaulter, meet with a legal consultant of competence, for suitable advice, and be a good leaver.
Residents largely survive in the UAE on their daily job and ought to follow the policy of switching jobs by being “good leavers.” This frankly doesn’t take much to do since the law is very clear and easy to maintain. In fact, most free zones/licensing authorities sympathize with the employee realizing that a doctor will always be a doctor and a lawyer always a lawyer, largely depending on time frame and some other parameters. The non-compete is hence hard to practice in reality and therefore the agreements made by companies must realize this, wherein most employers are reasonable and understand the power of the Courts considering maintainability.
To be a good leaver as per the labor laws in the UAE requires compliance with the Law and strategic negotiation. Here's how you can navigate the transition smoothly:
1. Understanding the Non-Compete Clause
- Article 10 of the UAE Labour Law (Federal Decree-Law No. 33 of 2021) states that a non-compete clause is valid only if:
- It is specific in scope (limited to a certain industry, role, or trade secrets).
- It has a reasonable geographic limitation (not overly broad or unjustified).
- It does not exceed one/two years from the date of contract termination.
- If the clause is too broad, it may not be enforceable in court.
2. Ways to Leave as a "Good Leaver" Despite a Non-Compete Clause
A. Mutual Agreement with Employer (Best Approach)
- Negotiate a waiver of the non-compete clause, possibly by offering:
- An extended notice period (to allow a smooth transition).
- Assistance in training a replacement.
- An amicable exit with no client poaching.
- Check your contract: Some employers allow exceptions in return for certain commitments.
B. Challenge the Clause if It’s Unenforceable
- If the non-compete clause is too broad, vague, or unreasonable, it can be contested in court.
- Courts usually do not uphold non-compete clauses that:
- Prevent employees from working outside the UAE.
- Restrict job mobility without a legitimate business interest.
- Apply beyond the two-year limit.
C. Industry-Specific Exemptions
- Employees in critical industries (healthcare, engineering, AI, cybersecurity, etc.) may get exemptions from non-compete restrictions under UAE labor policies.
- If moving to a government or semi-government role, non-compete clauses may not apply.
D. Free Zone vs Mainland Transfer
- If moving within the same free zone, the free zone authority (e.g., DIFC, DMCC) may need to approve the transition.
- If shifting from a mainland company to a free zone (or vice versa), the non-compete clause may hold if enforced by the previous employer.
3. Resignation and Exit Strategy
- Serve the notice period as per your contract to maintain a good professional relationship.
- Ensure gratuity payments and end-of-service benefits are processed properly.
- Do not take company data, confidential information, or client lists, as this may lead to legal action.
- Obtain a good reference from the employer, as future employers may check.
4. Legal Recourse if Employer Enforces the Non-Compete Clause Unfairly
- If an employer unreasonably enforces the non-compete, file a case with:
- MOHRE (Ministry of Human Resources and Emiratisation) for employment disputes.
- UAE Labour Courts if the case is escalated.
- If you are facing a work ban, you can appeal based on unfair restrictions.
Additional Considerations When Leaving the UAE
If an individual is leaving the UAE and has no intention of returning to the country on residency, it is advised to close all bank accounts as laid down in Article 9(b) of the UAE Central Bank Regulation No. 29/2011 dated February 23, 2011, on Regulations Regarding Bank Loans & Other Services Offered to Individual Customers. The law states:
“Commercial banks may open all types of accounts for their retail customers, but in such cases, they must abide by the standard agreement mentioned under Article (12) of these regulations. In case a customer requests the closing of the account and termination of the business relationship with the bank, the bank should do that without imposing a penalty if the account opening date goes back more than one year. In all cases, an account must be closed and an appropriate certificate must be issued within, maximum, seven days from the date of submission of the application.”
Furthermore, for the cancellation of family members’ visas, you can either visit the Amer Service Centre or complete the process online by submitting the required documents and paying the applicable fees. An individual sponsoring his/her spouse, children, and other dependents must ensure that their visas are cancelled before cancelling their own visa.
Regarding tenancy agreements, the Dubai Land Law does not specifically address the early termination of such agreements. Therefore, you should notify your landlord in writing at least 90 days prior to the expiration of the lease, indicating your intention not to renew and your decision to vacate. If you intend to vacate before this period, inform your landlord and seek mutual agreement. If no agreement can be reached, you may contact the Real Estate Regulatory Authority for assistance.
According to Article 14 of Law No. 33 of 2008, unless otherwise agreed, either party wishing to amend terms must notify the other party no less than 90 days before the contract expires.
It is also advisable to clear all credit card dues before leaving the UAE. Should you default on any payments, the lender may approach the relevant court if the outstanding amount exceeds Dh10,000 and request a travel ban under Articles 324 and 325 of the Federal Decree Law no. 42 of 2022 on Civil Procedures Law. Additionally, the lender may file a payment order case or a civil case to recover outstanding debts, potentially leading to execution proceedings against you, including a travel ban and arrest warrant.
Conclusion
To be a "good leaver" while switching jobs:
- Negotiate a waiver of the non-compete clause if possible.
- Ensure compliance with labor laws to avoid disputes.
- Exit gracefully by completing formalities and maintaining goodwill.
- Consult a labor lawyer if the non-compete clause is overly restrictive.
In conclusion, before leaving the UAE, it is essential to address key aspects such as closing bank accounts, cancelling family visas, managing tenancy agreements, and handing over property keys with acknowledgement from the landlord. Compliance with these steps will help avoid legal complications. For further guidance, consult the relevant authorities or legal professionals.
For further information or assistance please find out how our experts at Al Safar & Partners can help. Call +971 4 4221944 or email reception@alsafarpartners.com - https://www.alsafarpartners.com/ to get started.
Written by:
Mr. Rohit Gulati - Partner & Senior Legal Consultant at Al Safar and Partners Law Firm