A court in Abu Dhabi has recently rejected an employee’s claim for Dh100,000 in compensation from his employer for what he said were financial damages he suffered after the company wrongfully terminated his employment.
The claimant said that he signed a two-year contract with the company starting July 11, 2024. In August 2025, he obtained the UAE Golden Visa, and as part of the process to get the long-term process, they had to temporarily cancel his existing work contract, residency visa and work visa permit. He claimed that he agreed with the employer to issue him a new employment contract and work permit after the Golden Visa was issued.
However, when the employee approached his insurer to claim benefits under the UAE’s Involuntary Loss of Employment (ILOE) insurance scheme, he was informed that his employment contract had officially ended on August 11, 2025, and that no new contract had been registered. The employee alleged that his employer had previously agreed to issue a new contract after his Golden Visa was granted. Because more than one month had passed since the recorded termination date, the insurer rejected his claim under the policy rules.
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What the employee claimed
In his lawsuit, the employee said that due to ending his employment contract “wrongfully”, he lost unemployment insurance benefits and missed a job opportunity in Saudi Arabia with a salary of Dh45,975. He claimed his company did not adhere to the original two-year contract and it ended his employment without a valid reason. He told the court that because of what happened, he also became jobless
Therefore, he asked the court to order the company to pay him Dh100,000 in compensation.
How the company responded
The company denied any wrongdoing in the case and stated that the termination of his employment was lawful and that he was given written notice. It also stated that he completed his notice period in accordance with UAE labour laws.
The employee, it added, had no evidence to prove any financial damages or any missed job opportunity in Saudi Arabia.
What did the court say?
In its final decision, the Abu Dhabi Family, Civil and Administrative Claims Court rejected the lawsuit, saying: “The employee claimed that the company harmed him by failing to issue a new contract after his Golden Visa, but he did not prove this agreement or any actual damage, so his compensation claim cannot be accepted.”
The court rejected his claim because it found he failed to prove that the company committed a wrongful act or caused him any damage. The judge said the employee did not prove the alleged agreement or obligation on the company’s part to issue a new employment contract after he obtained the Golden Visa.
The court also noted that, according to the employee’s own statement, the cancellation of the contract and work permit was agreed by both parties to obtain the Golden Visa. Therefore, the court found that the cancellation itself was a mutual arrangement rather than evidence of wrongdoing by the company.
In addition, the court found that the employee did not provide sufficient evidence to support his claimed losses, including his allegation that he lost a job opportunity in Saudi Arabia, nor did he prove that the company was responsible for the loss of his unemployment insurance benefit.
In addition to rejecting the Dh100,000 claim, the court ordered the employee to pay the court fees.
Source: Khaleej Times