Can I Resign in Limited Contract? Labour Law | Rights | Obligations

In the UAE, many employment contracts are limited, meaning they have a fixed end date. This is often tied to the duration of your residency visa (typically 2-3 years). Understanding this type of contract is important, especially when considering resignation. Limited contracts in the UAE offer flexibility for both employers and employees. But what happens if you, as an employee, decide you want to leave before the contract ends?  In this article, “Can I Resign in a Limited Contract?  We will explain the legalities surrounding resignation within a fixed-term contract in the UAE. 

We’ll explore notice periods, potential consequences of early termination, and how your decision might impact your end-of-contract benefits. By understanding your rights and obligations, you can make informed choices regarding your employment and ensure a smooth transition if resignation becomes necessary. Keep reading…!

What is a Limited Term Contract  in the UAE?

What is a Limited Term Contract  in the UAE?

A limited contract in the UAE is a type of employment agreement that’s valid for a predetermined period, typically no longer than 3 years. It is different from an unlimited contract, which has no set end date. 

The contract clearly outlines a start date and an end date. This end date is often linked to the duration of your UAE residency visa.

The Limited contract may be renewed for a similar or shorter period if both the employer and employee agree.

Unless renewed or terminated early by either party with proper justification, the contract simply ends on the specified date.

Limited term contracts are frequently used for temporary projects, probationary periods, filling specific short-term needs.

See Also: Can I Resign after 6 Months In Limited Contract UAE

Overview of Limited Contract Resignation:

Limited Contract Resignation for Government Employees:

Under employment Law For government employees in Abu Dhabi with limited contracts, resigning involves submitting a written letter. The administration has one month to respond, and their decision dictates the next steps. If there’s no response within a month, you keep working. Upon resignation acceptance, a two-month paid handover period follows, during which you must return all work-related items. Remember, consulting the full law (Articles 80-81) or seeking professional guidance is recommended for a complete picture of your rights and obligations.

Limited Contract Resignation for Private Sector Employees:

Resignation procedures for limited contracts in the private sector of the UAE are governed by Federal Decree No. 33 of 2021. Despite the contract having a predetermined end date, a formal written resignation is required.

According to the decree, you must provide a mandatory 30-day notice period, during which your employment contract remains valid. Throughout this period, you are entitled to receive your regular salary and are expected to fulfill your work obligations. Although it is advisable to provide a reason for resigning, your employer cannot unreasonably delay accepting your resignation due to workload constraints.

Can I Resign Before my Contract Ends?

Resigning from a limited contract in the UAE before its scheduled end requires careful consideration. It’s essential to provide a written notice period, typically around 30 days, as stipulated by your contract. 

Additionally, it’s crucial to review your contract for any clauses regarding early termination fees, which may apply. Despite resigning, during the notice period, you are entitled to receive your regular salary but are still obligated to fulfill your job duties. This approach ensures compliance with contractual obligations and maintains professionalism throughout the resignation process.

The biggest concern for non-national private sector workers is the work ban. Resigning without a valid reason can prevent you from finding a new job in the UAE for a year.  Considering these factors and consulting your contract, MOHRE, or a legal professional will help you make an informed decision.

Resignation Process in Limited Contracts:

Resignation Process in Limited Contracts:

Resigning from a limited contract involves a formal process.  First, submit a written resignation letter stating your last day. The required notice period will depend on your contract and local laws (often 30 days). During this time, review your contract for any early termination fees or handover procedures, and continue fulfilling your job duties.  

Remember, consequences can vary. Some contracts have early termination fees, and in the UAE (for private sector non-nationals resigning without cause), a work ban may prevent securing a new job for up to a year. Always check your local regulations for the most up-to-date details.

Employee & Employer Obligations For Resignation Under Limited Contract:

Employees must adhere to the written notice requirements outlined in their contract or local regulations, if applicable, and may be subject to early termination compensation depending on contract terms. Additionally, they are expected to fulfill their duties responsibly during the notice period to facilitate a smooth transition. 

Employers must follow legal notice period requirements in responding to resignations, ensure timely payment of all earned wages and benefits until the last working day, and refrain from withholding pay for early termination unless explicitly specified in the contract or mandated by law. 

These obligations aim to uphold fairness and clarity in employment terminations within the UAE’s private sector.

See Also: Do I Need To Pay If I Resign Under Limited Contract

Know Your Rights – Labour Law for limited contract in UAE Termination Clauses:

Know Your Rights - Labour Law for limited contract in UAE Termination Clauses:

The UAE Labor Law outlines some key points regarding notice periods and compensation in limited contract resignations: Articles 43, 44, and 45 of the UAE Employment Law!

Notice Period: 

Both employers and employees must give written notice (30-90 days) to terminate a contract, and work continues during this period. Wages are due for the notice period.

Notice Period During Leave (Article 35):

If termination coincides with an employee’s leave (vacation, sick leave, etc.), the notice period starts only when the employee returns from leave.

This can be altered by mutual agreement between the employer and employee.

Notice Period Allowance (Article 43(3)):

  • If either party (employee or employer) fails to fulfill the designated notice period, they must compensate the other party.
  • This compensation, called “notice period allowance,” is equal to one month’s salary for the employee.
  • Interestingly, this compensation is mandatory even if the non-breaching party didn’t suffer any harm due to the other party’s absence.

Job Hunting During Notice Period (Article 43(5)):

In case of an employer-initiated termination, the employee has the right to take one unpaid day off per week for job hunting during the notice period.

However, the employee must inform the employer three days in advance about their job-hunting absence.

Employer Exceptions (No Notice Dismissal): 

Employers can dismiss without notice for serious reasons like:

  • Employee misconduct
  • Safety violations
  • Absence

A written investigation and justification are required.

Employee Exceptions – Resignation Without Notice (Article 45):

Employees can resign without notice and retain end-of-service benefits in cases:

  • Employer breaches the employment contract.
  • Employer physically assaults the employee.
  • Employers assign new duties without the employee’s consent.

Illegal Termination: 

If fired without a valid reason, employees can seek compensation from the Ministry of Labor or file a lawsuit.

Consulting a legal professional is always advisable for a comprehensive understanding of your rights and obligations, especially in complex situations.

Limited Contract Resignation in UAE- Advice for Employees:

Resigning from a limited contract in the UAE requires planning. 

First, understand your contract, especially regarding notice period, early termination fees, and handover procedures. If unsure, seek legal advice. 

Before resigning, gather key documents, consider your reasons (especially if a non-national private sector worker is facing a potential work ban), and calculate the notice period.  

Then, draft a formal resignation letter and discuss it with your employer. 

Finally, responsibly fulfill your notice period and ensure a smooth handover. 

By following these steps and seeking professional help when needed, you can navigate your resignation smoothly.

See Also: Difference Between Limited and Unlimited Contract UAE


Do I need to pay if I resign under a limited contract?

When terminating a limited contract, consider the notice period requirement and potential early termination fees outlined in the contract. Failure to provide proper notice may lead to compensation obligations as per UAE Labor Law Article 43(3).

Can I resign before 6 months in a limited UAE contract?

Yes, you can resign before 6 months (or any point before the contract ends). However, remember the points mentioned above regarding notice period and potential early termination fees.

Can I resign after 6 months in a 2 year contract?

Yes, you can resign after 6 months or any point before the contract ends.  Hence, employees who have been employed for more than a year are entitled to end-of-service benefits. Conversely, individuals with less than a year of tenure may not meet the eligibility criteria.

What is Limited contract termination?

Limited contract termination involves concluding an employment agreement with a predetermined duration. This can occur in several ways. Firstly, the contract naturally expires on the agreed-upon end date. Alternatively, the employee may opt for early termination by resigning before the end date, subject to proper notice and potential consequences such as early termination fees or work bans. Conversely, the employer may initiate early termination by adhering to legal obligations and offering the employee due compensation before the contract’s expiration.

What is the gratuity for a limited contract?

To calculate gratuity for employees with limited contracts, follow these steps:
1. Determine the daily rate by dividing the monthly wage by 30.
2. Multiply the daily rate by either 21 or 30, depending on the terms of the employment contract.
3. The resulting amount represents the gratuity payment the employee will receive for each year of service.

This calculation method ensures that employees receive a fair and proportional gratuity payment based on their monthly wage and length of service.


Navigating resignation within a limited contract in the UAE requires careful consideration of legal obligations and potential consequences. Understanding notice periods, early termination fees, and end-of-contract benefits is essential for both employees and employers. By adhering to contractual terms and seeking professional guidance when needed, individuals can ensure a smooth transition and protect their rights throughout the resignation process.

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