Dubai Court of Cassation, Labour Appeal No. 6 of 2025, judgment of 8 April 2025
Under Article 40(2) of the Labour Relations Law an employer may suspend a worker accused of certain offences, without pay, until a final decision; if the worker is not sent for trial, is acquitted for want of an offence, or the investigation is closed for insufficient evidence, he must be reinstated with his full suspended wages, and the suspension counts as continuous service for leave and gratuity. The one-year bar in Article 54(7) is suspended under Article 481 of the Civil Transactions Law while a lawful excuse prevents a claim; a worker cannot claim wages for the suspension while the criminal case is pending, so time runs only once the criminal judgment is final.
An employee joined a company in November 2020 at a monthly salary of AED 18,000. In September 2022 the company suspended him from work because of a criminal case, in which the criminal Court of Appeal eventually acquitted him and others. He asked to be reinstated and paid; the company refused in July 2024, and he sued later that month for his wages during the suspension, compensation for arbitrary dismissal, gratuity, leave pay and a ticket. The company pleaded limitation and counterclaimed for a loan of AED 30,000. The Court of First Instance awarded about AED 247,300 and allowed the counterclaim; the Court of Appeal raised the award to about AED 421,900, granting full wages from the suspension to the refusal to reinstate.
The company argued in cassation that Article 40(2) entitles a suspended worker to his wages only if he is acquitted because no offence was committed, whereas he had been acquitted because the evidence was insufficient, and that the suspension period should not count towards leave and gratuity.
The Court of Cassation dismissed the appeal. Article 40(2) allows an employer to suspend a worker accused of certain offences until the competent authority's final decision, with his wages suspended, and requires reinstatement with full suspended wages if he is not prosecuted, is acquitted for want of an offence or the investigation is closed for insufficient evidence. Article 54(7) bars claims after one year from the date the right falls due, but under Article 481 of the Civil Transactions Law time does not run while a lawful excuse prevents a claim; such excuses are not listed exhaustively and may be material, legal or moral. The Court of Appeal had found that the claim for wages depended on the outcome of the criminal case, so that the worker could not sue before a final judgment, and he had sued about 18 days after it became final. The acquittal by the criminal Court of Appeal showed that he had committed no punishable offence. Since he was entitled to his full wages for the suspension, his service was continuous and the period counted for leave and gratuity.
Employers that suspend staff during criminal proceedings carry the financial risk of an acquittal: back pay for the whole suspension and its inclusion in service for gratuity and leave, even where the employer argues that the acquittal rested only on insufficient evidence. Because limitation is suspended until the criminal judgment is final, the worker may bring the claim long after the suspension began.
| Articles 40 and 54 of Federal Decree-Law No. 33 of 2021 Regulating Labour Relations — text of articles 40, 54 |
| Article 481 of the Civil Transactions Law (Federal Law No. 5 of 1985) (suspension of limitation) — text of article 481 Decided under this law; it has been replaced by Civil Transactions Law 2025. |
“يقف مرور الزمان ولو كان هذا المانع مادياً أو قانونياً أو أدبياً”Short quotation from the judgment as published by the court. The full judgment is on the court’s official service.
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