Penalty for companies in UAE that shut down without settling dues

Penalty for companies in UAE that shut down without settling dues

Dubai: Any company which closes down without settling the dues of those it sponsors will face a penalty by Ministry of Labour, a top official at the Ministry of Labour has said.www.dubaibusinesskey.com

The official said that they have listed companies who commit different types of violations and will immediately stop dealing with them until they rectify the violations.

The ministry has outlined four types of grave rule violations which will disqualify an employer from getting work permits and opening a register for setting up a new company or establishment.

The new criteria will come into force late next month and it will state an employer will not be issued the ‘Establishment card’ or issued work permits to recruit employees for his/her company or if the person is part owner of a company.

It will also affect partners in a new company which may have committed the violations in a company they may have previously owned or part owned.

Humaid Bin Deemas Al Suwaidi, Assistant Undersecretary for Labour Affairs said that a notification will be sent to those companies and if they did not respond the ministry will stop issuing work permits for those companies or any companies owned by the same owner starting from next month.

He said that the step came by the ministry in implementation of the decision of Saqr Ghobash Minister of Labour which was issued recently to regulate the procedures for issuance of labour permits and opening the establishment card.

He said the ministry will stop dealing with any other company belonging to the same owner which closed down without settling workers dues. “No deadline will be given to the violators,” he said.

The serious violations include nonpayment of the wages of employees for two months or more, nonpayment of the administrative fines due to the Ministry of Labour for four months, non-issuance or renewal of labour cards of employees for four months from the date the new worker has entered the country or from the expiry date of an existing worker’s card, and non-renewal of the trade licence of the establishment for four months from the date of expiry.

Under the resolution, the suspension of services includes granting of work permits for hiring or bringing in a worker from abroad, issuing a new work permit for an employee to switch to another company, issuing of work permits to employees who are on their parents’ visa, for temporary work, or for doing part-time jobs; and amendment of the information about the violating company in a way that results in altering the names of its owners whose data are registered with the ministry.