Claim No. XXXX
THE DUBAI INTERNATIONAL FINANCIAL CENTRE
COURTS
In the name of His Highness Sheikh Mohammed Bin Rashid Al Maktoum,
Ruler
IN THE SMALL CLAIMS
TRIBUNAL
BEFORE H.E. JUSTICE SHAMLAN AL SAWALEHI
BETWEEN
ENOLA
Claimant
and
ENOK
Defendant
Hearing: 1 September 2014
Parties: Elzbieta, litigant in person
Defendant is represented by XXXX
Judgment: 2 October 2014
JUDGMENT OF H.E. JUSTICE SHAMLAN AL SAWALEHI
Parties
1. The Claimant is Enola, a previous employee of the Defendant.
2. The Defendant is Enok, located in the DIFC
Factual Background
3. From 4 March 2007 until 17 July 2014, the Claimant entered into an employment agreement with the Defendant which was terminated by the Defendant on 17 July 2014.
4. On 24 July 2014, the Claimant filed a claim with the DIFC requesting her end of service benefits in the total amount of AED 191,766.00.
5. On 5 August 2014, a consultation was attended by both the Claimant and the Defendant before Judicial Officer Maha Al Mehairi, but no settlement was reached. A hearing was scheduled for 9 September 2014 before H.E. Justice Shamlan Al Sawalehi.
The Hearing
6. On 9 September 2014, the hearing was held before H.E. Justice Shamlan Al Sawalehi, attended by both the Claimant and the Defendant. Both Claimant and Defendant were instructed by H.E. Justice Shamlan Al Sawalehi to decide if they wanted to settle the claim out of court before proceeding with the hearing, but both parties declined to settle the claim and requested the Judge
7. According to the party’s submissions and presentations at the hearing, the Defendant confirms that the Claimant is entitled to the amount of AED 4,158.67 only, and refused to pay the Claimant the gratuity payment, alleging that she had been terminated for gross misconduct, as she had threatened to tarnish the company’s name among candidates and clients.
8. The Defendant confirms that the final calculation of amounts owing to the Claimant is AED 34,158.67, being an amount of unpaid salary for 29 days and untaken leave of 9.5 days. However, the Defendant argued that the Company had advanced an interest-free loan of AED 30,000.00 to the Claimant, which was to be deducted from monies owing to the Claimant.
9. The Claimant confirms the advanced loan, but she denied allegations of misconduct on her part and asserted that she had a conversation with a company staff member called “Amy” about her concerns as to whether and when she could inform candidates that she was leaving the company upon termination of her employment contract due to the company’s closure and not due to termination.
Court
10. The Defendant’s arguments about denying the Claimant her gratuity are invalid, as the Defendant has failed to submit clear evidence to prove that the Claimant had been terminated for cause in circumstances where the conduct of one party warranted termination and where a reasonable employer would have terminated the employment as defined in Article 59 (A) of the DIFC Employment Law No. 4 of 2005.
11. The written witness statement of xxxx which was submitted by the Defendant to support its argument in this regard cannot be considered “stand alone evidence”, because she is one of the Defendant’s employees and to that extent I do not rely on its facts, nor I am considering to take into account her statement for lack of independence.
12. Therefore, Article 59(5) and (59) of the DIFC Employment Law No. 4 of 2005, do not apply in this case and the Claimant is entitled to her gratuity as calculated below.
13. On the other hand, the DIFC Employment Law No. 4 of 2005, Article 62 (1) and (2), emphasise that employees who complete continuous employment of one year or more are entitled to a gratuity payment at the termination of employment, calculated as twenty one days’ basic wage for each year of the first five years of service. And thirty (30) day’s basic wage for each additional year of service.
14. However in this case, the two parties of this dispute do not have the same view as to whether or not the Claimant’s salary is divided into basic salary and allowances. To support its argument,the Defendant submits an internal circular dated 28 July 2013 to clarify the split between basic salary and allowances within the Claimant’s salary as 70:30 percent ratio respectively , which stated at the end that:
“Agreement has been reached in writing with all three of the above mentioned members of staff, (including the Claimant), on or before 28 July 2013”.
15. I have examined the appendices submitted by the Defendant and noticed that the Claimant had accepted by email dated 28 July 2013 the new company policy that split her salary into “base salary” and “salary including all allowances” at 70/30 percent ratio.16. Furthermore, I have reviewed the email sent from the company to its employees copied to the Claimant on 12 December 2011, which awarded her the sum of AED 500 monthly so that she could take out whatever healthcare plan best suited her needs on the basis of individual cover not corporate cover. Such extra payment should be counted as extra allowance and not part of the Claimant’s gross salary.
17. Therefore, I am considering in this judgment that the Claimant’s basic wage per day was AED 630 which is calculated as 70 % of the Claimant’s gross salary (AED 27,000) divided into 365 days in a year, since 4 March 2007 until 29 July 2014 the last working day, which would entitle the Claimant to the sum of AED 1, 112, 58 as total gratuity calculated as follows:
a) Gratuity for 5 years ( 630 * 105 days ( 21*5) ) = AED 66,150
b) Gratuity for extra 2 years ( 630* 60 days ( 30* 2) ) = AED 37,800
c) Gratuity for extra 4 months (630 * 120 days * 0.08 (30 % 365) = AED 6,048
d) Gratuity for remaining 25 days of July 2014 ( 630 * 25 * 0.08 ( 30 % 365) ) = AED 1,260
18. As to regards any other complaints made in this case, the Court views that there are no legal grounds to base those claims upon, and that they are not supported by reasonable evidence, and consequently should be dismissed.
19. Then I found that the total amount that the Claimant is entitled to is the sum of AED 1,468,46 calculated as follows :
a) Unpaid salary for the month of July = AED 27,000
b) Unpaid leave for 9.5 days = AED 8,588
c) Unpaid total gratuity = AED 1, 112, 58
20. Having said that, according to the DIFC Employment Law there are four circumstances that may authorise an employer to deduct from an employee’s wages. Section 19 (b) and (c) of the DIFC Employment Law No. 4 of 2005 states that an employer shall not deduct from an employee’s wages or accept payment from an employee, unless:
a) the employee has previously agreed in writing to the deduction or payment;
b) the deduction or payment is a reimbursement for an over payment of wages or expenses …”
21. In this case, the Claimant has not denied the fact that she received an advance interest-free loan from the Defendant, therefore the deduction of AED 30,000.00 from the Claimant’s total benefits towards that loan is legally authorized and accepted by the Court.
22. Having accepted the Defendant’s deduction, the total amount payable to the Claimant is the sum of AED 1, 168, 46.
23. For the reasons mentioned above, it is hereby ordered that the Defendant pay the Claimant the sum of AED 1, 168, 46 in addition to the Courts fee.
Issued by:
Maha Al Mehairi
Judicial Officer
Date: 2 October 2014
At: 3pm