December 30, 2022 SCT - Judgments and Orders
Claim No: SCT 406/2022
THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS
In the name of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Ruler of Dubai
IN THE SMALL CLAIMS TRIBUNAL
BEFORE SCT JUDGE MAITHA ALSHEHHI
BETWEEN
LIV
Claimant
and
LAVA LTD
Defendant
| Hearing : | 27 December 2022 |
|---|---|
| Judgment : | 30 December 2022 |
JUDGMENT OF SCT JUDGE MAITHA ALSHEHHI
UPON this claim having been filed on 11 November 2022
AND UPON a hearing having been held before SCT Judge Maitha AlShehhi on 27 December 2022, with the Claimant and the Defendant’s representative in attendance
AND UPON reviewing the documents and evidence filed and recorded on the Court file
IT IS HEREBY ORDERED THAT:
1. The Claimant’s claim in respect of her notice period shall be dismissed.
2. The Defendant shall pay the Claimant the amount of AED 6,660 in respect of her accrued but untaken vacation leave.
3. The Defendant shall proceed to cancel the Claimant’s employment visa.
4. The Defendant shall lift the absconding order imposed on the Claimant.
5. The Defendant shall pay the Claimant the DIFC Courts filing fee in the amount of AED 367.25.
Issued by:
Ayesha Bin Kalban
Registrar
Date of issue: 30 December 2022
At: 10am
THE REASONS
The Parties
1. The Claimant is Liv (the “Claimant”), an individual filing a claim against her former employer.
2. The Defendant is Lava Ltd. (the “Defendant”), a company registered in the DIFC, Dubai, the UAE.
Background and the Preceding History
3. The underlying dispute arises over the employment of the Claimant by the Defendant pursuant to an employment agreement dated 1 February 2022 (the “Employment Agreement”) in the position of Head of Administration.
4. In addition to her position as Head of Administration, the Claimant was also acting in the capacity of Company Board Secretary.
5. On 28 September 2022, the Claimant submitted her resignation by way of a letter addressed to the director, Mr. Lebron Ofner (the “Resignation Letter”) due to the removal of her line manager and director Mr Lamar (“Mr Lamar”).
6. On 9 November 2022, the Claimant was notified by the Defendant’s legal representative that an absconding case has been lodged against her on 25 October 2022. As a result, a travel ban was imposed against her by the relevant authorities.
7. On 11 November 2022, the Claimant filed a claim in the DIFC Courts’ Small Claims Tribunal (the “SCT”) seeking the following reliefs from the Court:
(a) payment of her notice period salary, gratuity and payment in lieu of untaken vacation leave in the amount of AED 28,047;
(b) lift the absconding case and travel ban imposed against her;
(c) immediate cancellation of the Claimant’s employment visa; and
(d) damages arising from the imposition of the travel ban.
8. The Claimant amended her claim on 28 December 2022 to remove the request for gratuity payment on the basis she has not completed one year of service in the company. As such, the total amount she is currently claiming is AED 20,208 which represents her notice period salary as well as the 6 days untaken vacation days.
9. On 18 November 2022, the Defendant filed its defence to the claim alongside the acknowledgement of service form.
10. On 8 December 2022, the parties met for a consultation before SCT Judge Hayley Norton. However, they were unable to reach a settlement with respect to the Claimant’s claims.
11. In line with the rules and procedures of the SCT, this matter was referred to me for determination, pursuant to a hearing held on 27 December 2022 (the “Hearing”).
The Claim
12. The Claimant’s case is that upon her departure from the company, the Defendant failed to pay her end of service entitlements as per the Employment Agreement and Article 19(1) of the Employment Law DIFC Law No. 2 of 2019 (the “DIFC Employment Law”) which states that all renumeration is to be paid out to the employee within 14 days of the termination date.
13. The Claimant submits that she has tendered her resignation on 28 September 2022 and was ready to accept instructions to work during her notice period which ends on 28 October 2022, however, no such instructions were received specially since there was no physical office to attend to. For that reason, she is claiming the payment in lieu of the notice period for the month of October 2022.
14. The Claimant stipulates that she was shocked to receive the news that an absconding case was filed against her before the end of her notice period by 3 days which has resulted in the passport being confiscated from her.
15. On 12 October 2022, the Defendant sent the Claimant a letter entitled “Formal Notice of Breach of Legal Obligations” which includes a declaration form to be signed by the Claimant. The Claimant acknowledges the letter and confirms that she has replied to the Defendant to ask for further clarification by way of a letter dated 25 October 2022. No response was received from the Defendant.
16. At the Hearing, the Claimant confirmed that she refused to sign the letter as she has already signed the Employment Agreement and the employment handbook and is unwilling to sign any other document.
17. At the Hearing, the Claimant confirmed that she has done a proper handover to the Defendant, which includes the following:
(a) the company’s operational and administrative data. This is on the basis that such data are stored in the shared cloud which is owned and operated by the company. Therefore, she is unaware of any other documents that needs to be handed over to the Defendant;
(b) as to her role as the Company Board Secretary, the Claimant attests that minutes of the meetings were always shared at the conclusion of each meeting by way of email and nothing further can be disclosed to the Defendant regarding this;
(c) the Claimant submits that the laptop she used to perform her duties was hers and is not owned by the Defendant. As such, the laptop was not handed over to the Defendant; and
(d) the Claimant submits that she has handed over her work phone to Mr Lamar on 25 October 2022 as she did not know who else to give it to since the Defendant did not respond to the Claimant’s letter of 12 October 2022.
18. The Claimant submits that she is not an authorised signatory and all information have been submitted to the Defendant via the shared cloud.
19. The Claimant is pleading that the employment visa ought to be cancelled as soon as possible pursuant to Article 57(3) of the DIFC Employment Law as she would like to look for another job opportunity as her current situation does not permit her to work for another company.
The Defence
20. The Defendant submits that the Claimant failed to serve her 30 days’ notice period as mandated in the Employment Agreement and has ceased communication with the Defendant immediately after resignation. As such, the Claimant is not entitled to receive payment in lieu of her notice period especially since the Defendant believes that the Claimant has worked for a competitor in her notice period.
21. The Defendant submits that the Claimant failed to adhere to the Defendant’s procedures set out to navigate the exit process for employees which includes completing the handover checklist, signing the declaration form and returning the Defendant’s property. This has left the Defendant in a vulnerable position.
22. The Defendant confirms that the letter of 12 October 2022 explains the appropriate handover mechanism to follow which the Claimant neglected to satisfy such exit formalities. This includes the situation where the Claimant surrendered her phone to Mr Lamar where in fact it should have been handed over to Ms Lola as stated previously in the letter.
23. The Defendant submits that the Claimant failed to return the Defendant’s property, including but not limited to the Company laptop, a Company phone with the contact details of all the Defendant’s clients, the administrative and operational data and cloud data.
24. The Defendant further submits that the Claimant also has failed to surrender company document’s including but not limited to the following:
(a) reports on company;
(b) important emails and addresses related to company activities;
(c) comprehensive minutes taken at the Company Board meetings for future reference and record of the Company Board, the Company’s book of records;
(d) a list of all pending company events and public engagements; and
(e) the list of contracts concluded, the Prebid negotiations done with contractors and vendors (trade secrets and sensitive information).
25. At the Hearing, the Defendant submitted that it does not have access to the shared cloud data as alleged by the Claimant.
26. The Defendant submits that the Claimant failed to act in good faith when she did not notify the board about the termination of the lease by authorised signatories which is a breach of her fiduciary obligations towards the Defendant pursuant to the Law of Obligations DIFC Law No.5 of 2005.
27. For the above reason and fear of potential breach of confidentiality and non-competition, the Defendant has applied for an absconding case against the Claimant on 25 October 2022 and retains the Claimant’s employment visa.
Discussion
28. I shall set out below each of the Claimant’s claims, the Defendant’s defence to each claim, and accordingly, the Court’s reasoning and finding.
Payment In Lieu of Notice Period
29. Following the Claimant’s resignation and pursuant to the Employment Contract, the Claimant is claiming one month salary for the month of October 2022 in the amount of AED 15,000.
30. The Claimant confirms that she was available to perform her duties as usual. Nonetheless, given that there was no office to attend to and no instructions received by the Defendant, the Claimant was unable to accomplish any work.
31. The Claimant relies on Article 78 of the Contract Law DIFC Law No.6 of 2004 (the “DIFC Contract Law”) which reads as below:
"A party may not rely on the non-performance of the other party to the extent that such non-performance was caused by the first party's act or omission or by another event as to which the first party bears the risk.”
32. The Defendant states that the Claimant has failed to serve her notice period as there was no office to attend to and no work was completed. This is on the basis that the Claimant refused to handover the perquisite documents as asserted by the Defendant.
33. The Defendant circulated a memo on 4 October 2022 to all employees which reads as below:
“This Memo constitutes my formal response to your letters dated 28 September 2022. Henceforth, every Employee or senior management is legally bound to comply with the mandates under the Applicable UAE Laws. Including but not limited to the Applicable Formal 30 (Thirty) Days Notice (based on the signed Employment Contracts) period from the date of your resignation along with a proper full proof handover of the work tasks & all the company properties or assets subject to the profile & actual work each of you were engaged in”. [sic]
34. I acknowledge the Claimant’s reliance on Article 78 of the DIFC Contract Law. Nevertheless, the Claimant did not demonstrate to the Court the work she has undertaken during the notice period, nor she did provide evidence that she has attempted to perform her duties as usual despite the fact that her DIFC portal access was removed. In my opinion, this could not have formed her entire job or responsibility as Head of Administration.
35. The Claimant did not take any further steps to cooperate with the Defendant with regards to her duties, and this is evident in the Claimant’s failure to respond to the Defendant’s request to sign the. cooperate with the Defendant with regards to the exit process formalities.
36. Accordingly, the Claimant’s claim with respect to payment in lieu of her notice period shall be dismissed.
Payment In Lieu of Untaken Vacation Leave
37. The Claimant is seeking payment in lieu of 13.32 days of accrued and untaken vacation leave in the amount of AED 6,660.
38. Given that the employment tenure is less than one year, pursuant to Article 30(2) of the DIFC Employment Law, the Claimant is only eligible for annual leave calculated on a monthly basis and not the full financial year. As such, the Claimant has calculated her days based on 8.84 months rather than one year.
39. The Claimant provided a breakdown of her claim for payment in lieu of annual leave and confirmed that she has already utilised 2 days of her entitled allocation.
40. The Defendant failed to provide a record of the Claimant’s taken leave and the remaining balance of accrued days which it has an obligation to maintain under Article 16(1)(g) of the DIFC Employment Law, which states as follows:
“16. Payroll records
(1) An Employer shall keep records of the following information:
(f) the dates of Vacation Leave taken by the Employee and the Daily Wages paid by the Employer in respect thereof and the Vacation Leave balance owing”.
41. Therefore, I grant the Claimant’s claim in relation to her untaken vacation leave in the amount of AED 6,660.
Abscondment
42. The Claimant is seeking the immediate lifting of the absconding case against her as imposed by the Defendant.
43. The Defendant’s analysis behind filing the absconding case is to protect its assets and to protect its right against potential breach of confidentiality and non-competition.
44. I see no reason why this complaint should remain active. The Defendant, should it wish to, is better suited to pursue different recourses.
45. The abscondment procedure is utilised mainly in relation to violations of the UAE’s immigration laws, which can be solved by Government Services. For violations of other nature, an employer who wishes to impose a travel ban on an employee must seek the appropriate recourse to do so through the relevant channels.
46. Consequently, the Defendant is hereby ordered to lift the absconding case against the Claimant.
Visa Cancellation
47. The Claimant’s last day of her notice period was 28 October 2022. Since then, the Defendant has failed to cancel the Claimant’s employment visa which is in direct violation of the time limit set out in Article 57(3) of the DIFC Employment Law which reads as follows:
“57. Visas and permits
(3) If an Employee is sponsored for UAE residence visa purposes by their Employer, the Employer and the Employee must cooperate to ensure the cancellation of the Employee’s UAE residency visa as soon as reasonably practicable following the Termination Date and by no later than thirty (30) days following the Termination Date.”
48. The Defendant is not willing to cancel the Claimant’s employment visa up until she hands over the documents as requested in the letter of 12 October 2022.
49. As the 30 days’ time limit have lapsed and the employment visa is yet to be cancelled, I find that the Defendant is in breach of the DIFC Employment Law.
50. Therefore, I hereby order the Defendant to cancel the Claimant’s employment visa in accordance with Article 57(3) of the DIFC Employment Law. This is also on the basis that there isn’t any direct employment relationship between the Claimant and Defendant.
Damages
51. The Claimant is seeking unquantified damages in respect of the abscondment case and travel ban imposed against her.
52. Given that the damages have not been quantified by the Claimant, I have no proof to rely on in respect to this.
53. Hence, I shall dismiss the Claimant’s claim in relation to damages.
Conclusion
54. In light of the aforementioned, I hereby order that the Claimant’s claim in respect of her notice period shall be dismissed.
55. The Defendant shall pay the Claimant the amount of AED 6,660 in respect of her accrued but untaken vacation leave.
56. The Defendant shall proceed to cancel the Claimant’s employment visa.
57. The Defendant shall lift the absconding order imposed on the Claimant.
58. Given that the Claimant has not been successful in all her claims, I find that the Defendant shall pay the Claimant the DIFC Courts filing fee in the amount of AED 367.25.
