This Small Claims Tribunal judgment clarifies the evidentiary requirements for "for cause" termination and the binding nature of monthly payslips in determining basic salary for end-of-service gratuity calculations under the DIFC Employment Law.
What were the specific financial claims and factual disputes between Kaapro and Kacee (Dubai) LLC?
The dispute arose following the termination of the Claimant, Kaapro, from his position as a 'General Cook' at Kacee (Dubai) LLC. The Claimant initiated proceedings in the Small Claims Tribunal (SCT) seeking a total of AED 88,000 in end-of-service entitlements, alleging that his termination was invalid and that the Defendant had retroactively manipulated his salary structure to reduce his gratuity.
The scope of the claim was broad, encompassing unpaid salary for September 2019, notice period pay, compensation for arbitrary dismissal, untaken vacation leave, airfare allowances, and end-of-service gratuity. The dispute intensified during the proceedings when the Claimant sought to expand his recovery:
On 13 October 2019, the Claimant amended his claim and included an accommodation allowance at the rate of AED 100 per day.
The core of the factual disagreement centered on whether the Claimant was terminated for cause, as the Defendant alleged, or if the termination was a pretextual dismissal that entitled the Claimant to additional compensation. The total amount at stake was significant relative to the Claimant’s monthly earnings, with the parties fundamentally disagreeing on the calculation basis for his gratuity.
Which judge presided over the SCT hearing for Kaapro v Kacee (Dubai) LLC and when was the judgment issued?
The matter was heard before SCT Judge Maha Al Mehairi. The hearing took place on 30 October 2019, during which both parties presented their arguments and evidence. Following the submission of additional documentation requested by the Court, Judge Al Mehairi issued the final judgment on 11 November 2019.
What were the primary legal arguments advanced by Kaapro and Kacee (Dubai) LLC regarding the termination and salary structure?
The Claimant argued that his termination on 22 September 2019 was invalid because the alleged incidents occurred while he was on annual leave and outside his area of responsibility as a 'General Cook'. Furthermore, he contended that his basic salary was AED 10,000, as per his original Employment Contract, and that the Defendant had unilaterally and improperly reduced this to AED 5,000 for the purpose of calculating his end-of-service benefits. Regarding this salary breakdown, the Claimant asserted:
The Claimant alleges that he never received the payslips wherein the salary is broken down into a basic salary of AED 5,000 and general allowance of AED 5,000.
Conversely, the Defendant maintained that the termination was justified for cause due to operational failures within the Claimant’s department. The Defendant argued that the Claimant’s designation as 'Cook In-Charge' carried ongoing responsibilities regardless of his leave status. Regarding the salary dispute, the Defendant’s representative argued that the Claimant had received monthly payslips via email for the duration of his employment, which clearly delineated the basic salary as AED 5,000 and a general allowance of AED 5,000. The Defendant asserted that the Claimant’s failure to object to these payslips over the course of his employment constituted acceptance of the salary structure.
What was the precise legal question the Court had to answer regarding the validity of the termination and the calculation of gratuity?
The Court was tasked with determining two primary doctrinal issues. First, it had to decide whether the Defendant met the burden of proof required to establish a "termination for cause" under the DIFC Employment Law, which would negate the requirement for notice pay. Second, the Court had to determine the appropriate "basic salary" figure to be used for the calculation of end-of-service gratuity, specifically addressing whether the contractual figure of AED 10,000 or the figure reflected in the monthly payslips of AED 5,000 was legally binding upon the parties.
How did Judge Maha Al Mehairi apply the burden of proof to the Defendant’s claim of termination for cause?
Judge Al Mehairi evaluated the evidence provided by the Defendant regarding the alleged operational failures. The Court found that the Defendant failed to provide sufficient evidence to justify the summary dismissal of the Claimant. The judge emphasized that the burden of proof rests on the employer to substantiate the grounds for termination for cause. Because the Defendant could not satisfy this burden, the Court ruled that the Claimant was entitled to the notice period pay. The reasoning was articulated as follows:
I am not satisfied that the Defendant has established termination for cause and, therefore, the Claimant is entitled to 30 days’ notice in the sum of AED 10.000.
Furthermore, the Court addressed the Claimant’s request for compensation for arbitrary dismissal. The judge clarified that the DIFC Employment Law does not provide a remedy for "arbitrary dismissal" in the same manner as other jurisdictions, leading to the rejection of that specific head of claim:
The Claimant’s claim of 3 months’ salary in the sum of AED 30,000 is rejected as the DIFC Employment Law does not make provision for arbitrary dismissal.
Which specific provisions of the DIFC Employment Law No. 2 of 2019 were applied by the Court in this dispute?
The Court relied on several articles of the DIFC Employment Law No. 2 of 2019 to adjudicate the claims. Article 19 was cited regarding the Claimant's request for penalties for delayed payments. The Court utilized Article 28(1) and 28(3) to address the requirements for notice periods and the consequences of termination. Article 32(3)(b) was relevant to the calculation of vacation leave and public holidays. Finally, the Court applied Article 63(1) and Article 66 to determine the statutory requirements for end-of-service gratuity and the calculation of the daily wage.
How did the Court resolve the conflict between the Employment Contract and the monthly payslips regarding the gratuity calculation?
The Court utilized the principle of implied acceptance through conduct. Although the Claimant argued that his basic salary was AED 10,000, the Court noted that the Defendant had consistently issued monthly payslips reflecting a basic salary of AED 5,000. The Court found that the Claimant’s failure to raise any formal or informal complaint regarding these payslips during his employment served as evidence that he was aware of and accepted the salary breakdown. Consequently, the Court held that the gratuity must be calculated based on the AED 5,000 figure. The judge concluded:
I find that the Claimant was aware of the information set out on the pay slips which confirms his basic salary of AED 5,000
What was the final disposition of the claim and the specific monetary relief awarded to the Claimant?
The claim was allowed in part. The Court ordered the Defendant to pay the Claimant a total sum of AED 42,813.83. This amount comprised:
(a) Unpaid salary from 1–17 September 2019 (AED 7,846.18);
(b) 30 days’ notice pay (AED 10,000);
(c) Untaken vacation leave and public holidays (AED 10,384.65);
(d) Flight allowance (AED 1,500); and
(e) End-of-service gratuity (AED 13,083).
Additionally, the Defendant was ordered to pay the DIFC Courts filing fee of AED 856.27.
What are the wider implications of this judgment for DIFC employers and employees regarding termination and salary documentation?
This case serves as a critical reminder for DIFC employers that the threshold for proving "termination for cause" is high and requires robust, contemporaneous evidence. Employers cannot rely on vague allegations of operational failure to avoid statutory notice obligations. Furthermore, the judgment underscores the evidentiary weight of monthly payslips. Employees who accept payslips without objection over a sustained period may find it difficult to later challenge the salary components (such as the split between basic salary and allowances) when calculating end-of-service benefits. Practitioners should advise clients to ensure that all salary components are clearly documented in employment contracts and that any discrepancies in monthly payslips are addressed immediately rather than at the point of termination.
Where can I read the full judgment in Kaapro v Kacee (Dubai) LLC [2019] DIFC SCT 470?
The full judgment is available on the official DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/small-claims-tribunal/kaapro-v-kacee-dubai-llc-2019-difc-sct-470
Legislation referenced:
- DIFC Employment Law No. 2 of 2019, Article 19
- DIFC Employment Law No. 2 of 2019, Article 28(1)
- DIFC Employment Law No. 2 of 2019, Article 28(3)
- DIFC Employment Law No. 2 of 2019, Article 32(3)(b)
- DIFC Employment Law No. 2 of 2019, Article 63(1)
- DIFC Employment Law No. 2 of 2019, Article 66