An Employment Settlement Agreement is used when an employer and employee in the UAE agree to terminate their employment relationship on mutually agreed terms. This document is crucial for protecting both parties' interests and ensuring compliance with UAE labor laws, particularly Federal Decree-Law No. 33 of 2021. It is commonly used in situations involving senior executives, redundancies, or when resolving employment disputes. The agreement typically includes provisions for financial settlements, statutory entitlements, confidentiality obligations, and release of claims. For expatriate employees, it also addresses visa cancellation requirements. The document must be carefully drafted to ensure enforceability under UAE law and often requires consideration of both mainland UAE and free zone regulations where applicable.
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1. Parties: Identification of the employer and employee, including full legal names and details
2. Background: Brief history of employment relationship, reason for termination, and context of settlement
3. Definitions: Key terms used throughout the agreement
4. Termination Date: Confirmation of the official end date of employment
5. Settlement Payments: Detailed breakdown of all payments including salary, notice, gratuity, and additional settlement sums
6. Payment Terms: Timing and method of settlement payments
7. Tax and Deductions: Treatment of any applicable taxes or deductions
8. Company Property: Requirements for return of company property and documents
9. Confidentiality: Ongoing obligations regarding confidential information
10. Full and Final Settlement: Mutual release and waiver of claims
11. Continuing Obligations: Surviving terms from employment contract (e.g., non-compete, non-solicitation)
12. Governing Law and Jurisdiction: Confirmation of UAE law application and jurisdiction
13. Execution: Signature blocks and execution requirements
1. Immigration Status: Section addressing visa cancellation and immigration requirements for expatriate employees
2. Medical Insurance: Provisions regarding continuation or termination of medical insurance coverage
3. Reference: Terms regarding the provision of employment references
4. Announcements: Agreed form of internal/external communications regarding the departure
5. Garden Leave: Terms of any garden leave period if applicable
6. Share Options/Benefits: Treatment of outstanding share options or other benefits
7. Legal Fees: Provisions regarding payment of legal fees for agreement review
8. Non-Disparagement: Mutual obligations not to make derogatory statements
1. Schedule 1 - Payment Breakdown: Detailed calculation of all settlement payments including statutory entitlements
2. Schedule 2 - Company Property: List of company property to be returned
3. Schedule 3 - Claims: Comprehensive list of claims being settled
4. Appendix A - Resignation Letter: Form of resignation letter to be signed by employee
5. Appendix B - Release Form: Standard UAE Ministry of Human Resources and Emiratisation release form
6. Appendix C - Handover Document: Details of work handover requirements and process
Relevant legal definitions
Clauses
Relevant Industries
Banking & Financial Services
Technology
Real Estate & Construction
Healthcare
Retail & Consumer
Energy & Resources
Professional Services
Manufacturing
Education
Hospitality & Tourism
Media & Entertainment
Transportation & Logistics
Telecommunications
Relevant Teams
Human Resources
Legal
Finance
Compliance
Executive Leadership
Operations
Administration
Risk Management
Corporate Governance
Relevant Roles
Chief Executive Officer
Managing Director
General Manager
Department Head
Senior Manager
Manager
Technical Specialist
Professional Staff
Administrative Staff
Sales Executive
Operations Manager
Project Manager
Financial Controller
Marketing Director
Regional Manager
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