An Employee Release Agreement is a crucial document used in the United Arab Emirates when terminating employment relationships by mutual consent. The agreement, governed by UAE Federal Law No. 33 of 2021, serves multiple purposes: it documents the agreed terms of separation, outlines the final settlement package, addresses post-employment obligations, and provides mutual releases from future claims. This document is particularly important in the UAE context due to the specific requirements of local labor laws regarding employment termination, end-of-service benefits, and the need for clear documentation of settlements. It's commonly used during amicable separations, corporate restructuring, or negotiated exits, and must comply with both UAE mainland and free zone regulations where applicable. The agreement typically requires bilingual execution (Arabic-English) to ensure enforceability in UAE courts.
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1. Parties: Identification of the employer and employee, including all relevant registration/license numbers for the employer and Emirates ID/passport details for the employee
2. Background: Brief description of the employment relationship, including start date, position, and mutual agreement to terminate
3. Definitions: Key terms used in the agreement, including 'Effective Date', 'Final Settlement Amount', 'Claims', etc.
4. Termination of Employment: Formal statement of employment termination, specifying the last working day and effective date of termination
5. Final Settlement: Detailed breakdown of all payments including salary, end-of-service gratuity, leave encashment, and any other entitlements or bonuses
6. Return of Company Property: Employee's obligation to return all company assets, documents, and equipment
7. Confidentiality Obligations: Ongoing obligations regarding confidential information and trade secrets
8. Full and Final Settlement: Mutual release of claims and waiver of rights, subject to the payment of agreed settlements
9. Governing Law and Jurisdiction: Specification of UAE law as governing law and UAE courts' jurisdiction
10. Execution: Signature blocks for both parties, including witness provisions
1. Non-Compete Obligations: Include when the employee is bound by post-employment competition restrictions
2. Non-Solicitation: Include when preventing the employee from soliciting customers or other employees is crucial
3. Reference and Communications: Include when parties wish to agree on how future employment references will be handled
4. Outstanding Loans/Advances: Include when there are any outstanding loans or advances to be settled
5. Benefits Continuation: Include when certain benefits (like medical insurance) will continue for a specified period
6. Immigration Status: Include for expatriate employees regarding visa cancellation and status
7. Cooperation in Handover: Include when a formal handover process is required
8. Legal Fees: Include when there's an agreement about who bears the legal costs
1. Schedule 1 - Settlement Calculation: Detailed breakdown of all payment components and calculations
2. Schedule 2 - Company Property Checklist: List of all company property to be returned
3. Schedule 3 - Confidential Information: Specific list of confidential information and trade secrets
4. Schedule 4 - Non-Compete Terms: Detailed terms of any non-compete restrictions including geographic and temporal scope
5. Appendix A - Original Employment Contract: Copy of the original employment contract for reference
6. Appendix B - Arabic Translation: Arabic translation of the agreement as required by UAE law
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