March 17, 2020 SCT - Judgments and Orders
Claim No. SCT 262/2019
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 OF DIFC COURTS
BEFORE SCT JUDGE NASSIR AL NASSER
BETWEEN
LULIA
and
LELTIN INVESTMENT BANK LIMITED (LEO AS OWNER AND CEO)
| Hearing | : 6 October 2019 |
|---|---|
| Judgment | : 28 October 2019 |
JUDGMENT OF SCT JUDGE NASSIR AL NASSER
UPON hearing the Claimant and the Defendant’s representative
AND UPON reading the submissions and evidence filed and recorded on the Court file
IT IS HEREBY ORDERED THAT:
1. The Defendant shall pay the Claimant the sum of AED 252,797 in relation to the below:
(a) end of service gratuity;
(b) 4.7 days annual leave accrued but untaken;
(c) 8 days salary of December 2018; and
(d) penalties under Article 18 of the DIFC Employment Law from 20 February 2019 to 29 August 2019.
2. The Defendant shall continue to pay the Claimant penalties under Article 18 of the DIFC Employment Law at a daily rate of AED 1,108 from 30 August 2019 until the date of full payment.
3. The Defendant shall pay the Claimant the DIFC Courts filing fees in the sum of AED 5,239.66.
Issued by:
Nassir Al Nasser
SCT Judge
Date of issue: 28 October 2019
At: 2pm
THE REASONS
The Parties
1. The Claimant is Lulia (herein “the Claimant”), an individual filing a claim against the Defendant regarding his employment at the Defendant company.
2. The Defendant is Leltin Investment Bank Limited (Leo as owner and CEO) (herein “the Defendant”), a company registered in the DIFC Dubai.
Background and the Preceding History
3. The underlying dispute arises over the employment of the Claimant by the Defendant from the period of 2 January 2017 to 8 December 2018.
4. On 15 May 2019, the Claimant filed a claim in the DIFC Courts’ Small Claims Tribunal (the “SCT”) in the sum of AED 134,274 which consists of the following:
(a) gratuity in the sum of AED 32,090;
(b) untaken annual leave in the sum of AED 5,206;
(c) 8 days salary of December 2018 in the sum of AED 6,312; and
(d) penalties under Article 18 of the DIFC Employment Law from 20 February 2019 to 14 May 2019 in the sum of AED 91,938.
5. On 9 June 2019, the Defendant filed an acknowledgment of service defending part of the Claim.
6. The parties met for a Consultation with SCT Judge Maha Al Mehairi on 17 June 2019 but were unable to reach a settlement.
7. On 11 July 2019 a hearing was listed before SCT Judge Nassir Al Nasser, however, before the hearing, the parties settled the claim under the condition that the Defendant would pay the Claimant the settlement amount (the “Consent Order”).
8. Upon the Defendant’s failure to comply with the terms of the Settlement, the Claimant filed an Application Notice to set aside the Consent Order issued on 11 July 2019.
9. On 29 August 2019, SCT Judge Maha Al Mehairi issued an order setting aside the Consent Order and granted the Claimant a deadline to amend his claim.
10. On 3 September 2019, the Claimant amended his claim and claimed the sum of AED 252,797 which consisted of penalties under Article 18 of the DIFC Employment Law until 29 August 2019.
11. On 22 September 2019, the Defendant filed an acknowledgment of service with the intention to defend part of the claim.
12. On 6 October 2019, a hearing was listed before SCT Judge Nassir Al Nasser.
13. At the Hearing held on 6 October 2019, the Defendant argues that there has not been an intention to not pay the Claimant, but the company has been under pressure of liquidity.
14. At the hearing, the Defendant accepted that the Claimant is entitled to end of service benefits and penalties. However, the Defendant argues that the Company is under liquidity issues.
15. At the hearing, I granted the parties a 2-week period to discuss a settlement.
16. On 22 October 2019, the parties informed the Courts that the parties failed to reach a settlement.
Findings
17. At the hearing, the Defendant admitted that the Claimant is entitled to his end of service benefits and understood that there are penalties to be paid. The Defendant only explained the situation of the company.
18. As per the Article 18 of the DIFC Employment Law No. 4 of 2005, as amended by DIFC Law No. 3 of 2012 (the “DIFC Employment Law”), it is stated that:
“(1) An employer shall pay all wages and any other amount owing to an employee within fourteen (14) days after the employer or employee terminates the employment.
If an employer fails to pay wages or any other amount owing to an employee in accordance with Article 18(1), the employer shall pay the employee a penalty equivalent to the last daily wage for each day the employer is in arrears.”
19. The fact that the company is under financial difficulty does not stop the penalties under Article 18 from accruing. Therefore, Article 18 penalties shall accrue until the date of full payment.
20. Since the Defendant admitted at the hearing that the Claimant is entitled to his end of service benefits and acknowledges that late payment triggers penalties Article 18 of the DIFC Employment Law, I find that the Defendant is liable to pay the Claimant the sum of AED 252,797 being the Claimant’s (i) gratuity; (ii) 4.7 days annual leave accrued but untaken; (iii) 8 days salary of December 2018; and (iv) penalties under Article 18 of the DIFC Employment Law.
21. In relation to the Court fees, I find that the Defendant shall pay the Claimant the DIFC Courts fees in the sum of AED 5,239.66
Issued by:
Nassir Al Nasser
SCT Judge
Date of issue: 28 October 2019
At: 2pm
