Ask the law: Fine for an ex-employee who works for a competitor

Question:

A questioner asks: I own a company. My question: what are the penalties that the employer is legally entitled to impose on the worker, and is it required that the workers be acquainted with them or publish them in the workplace?

In the event that the employee resigns, and it is mentioned in his contract that, in the event of working with a competing company, he pays Dh30,000, do I have the legal right to file a lawsuit to claim this fine mentioned in the contract in the event that the employee works for a competing company? Please advise.

Answer:

To answer this question, I would advise the questioner that:

(The penalties as per Article 39 of the Federal Decree Labour law no. 33 of 2021 are:

(a.) Written notice;

(b.) Written warning;

(c.) Deduction of not more than (5) five days per month from the wage;

(d.) Suspension from work for a period not exceeding (14) fourteen days and non-payment of wage for the suspension days;

(e.) Deprivation from the periodic bonus for a period not exceeding one year, regarding the establishments that adopt the periodic bonus system; and the worker is entitled to obtain it according to the provisions of the employment contract or the establishment’s regulations;

(f.) Deprivation of promotion at the establishments having a promotion system for a period not exceeding two years;

(g.) Termination of service while preserving the worker’s right of end of service benefits.)

The employer shall draw up a schedule of penalties clarifying each of the disciplinary sanctions set out in Article (39) of the Decree-Law and it should be clear to all employees.

These sanctions are internal, which means that it is not necessary for the employer to inform the Ministry of Labour after the penalty is imposed.

None of the penalties set out in Article (39) of the Decree-Law may be imposed on the worker except after informing him in writing of the charges against him, hearing his statements, investigating his defense and recording the foregoing in a report to be deposited in his private file and annotated with the penalty at its end.

The worker shall be notified in writing of the penalties imposed thereon, the type and amount thereof, the grounds for their imposition and the penalty he will face in case of recurrence.

You have the right to file a case requesting for the fine mentioned in the contract in case the employee works for a competing company.