Najwa v Nawaf [2024] DIFC SCT 312 (18 September 2024)

Claim No. SCT 312/2024

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

In the name of His Highness Sheikh Mohammed Bin Rashid Al Maktoum,
Ruler of Dubai

IN THE SMALL CLAIMS TRIBUNAL OF DIFC COURTS
BEFORE H.E. JUSTICE NASSIR AL NASSER

BETWEEN

NAJWA

Claimant/Defendant in Counterclaim

and

NAWAF

Defendant/Claimant in Counterclaim

Hearing :	11 September 2024
Judgment :	18 September 2024

JUDGMENT OF H.E JUSTICE NASSIR AL NASSER

UPON this Claim being filed on 29 July 2024 (the “Claim”)

AND UPON a hearing having been held before H.E Justice Nassir Al Nassir on 11 September 2024, with the Claimant and the Defendant’s representative in attendance (the “Hearing”)

AND UPON reviewing the documents and evidence filed and recorded on the Court file

IT IS HEREBY ORDERED THAT:

1. The Defendant shall pay the Claimant the sum of AED 19,654.39 plus interest at the rate of 9% from the date of this Judgment until the date of full payment.

2. The Defendant shall pay the Claimant the court fees in the sum of AED 393.08.

3. The Defendant’s counterclaim shall be dismissed.

4. There shall be no order as to costs for the counterclaim.

Issued by:
Hayley Norton
SCT Judge and Assistant Registrar
Date of issue: 18 September 2024
At: 12pm

THE REASONS

The Parties

1. The Claimant is Najwa (the “Claimant”), an individual filing a claim against the Defendant regarding her employment at the Defendant’s company.

2. The Defendant is Nawaf (the “Defendant”), a company registered and located in DIFC, Dubai, UAE.

Background and the Preceding History

3. The underlying dispute arises over the employment of the Claimant by the Defendant pursuant to an employment agreement dated 8 May 2024 (the “Agreement”). The Claimant’s commencement date was on 10 June 2024 and her last working day was on 30 June 2024.

4. On 29 July 2024, the Claimant filed her claim with the DIFC Courts’ Small Claims Tribunal (the “SCT”) claiming pending salary, penalties under Article 19 of the DIFC Employment Law and interest on the Judgment sum and costs in the sum of AED 22,191.68.

5. On 30 July 2024, the Defendant filed an Acknowledgment of Service with the intention to defend all the claim.

6. On 6 August 2024, the Defendant filed a counterclaim claiming the sum of AED 21,450 for the time lost and visa costs (the “Counterclaim”).

7. On 21 August 2024, a consultation was held before SCT Judge Maha Al Mheiri, however the parties failed to amicably settle the claim.

8. In line with the rules and procedures of the SCT, this matter was referred to me for determination, pursuant to a hearing held on 11 September 2024 (the “Hearing”). The Claimant and the Defendant’s representative attended.

The Claim

9. The Claimant submits that 30 June 2024 was her last working day. On 1 July 2024 she informed the orally Defendant by way of a conversation that she no longer wishes to continue working. The Defendant immediately accepted her resignation and asked her to perform her handover with immediate effect.

10. The Claimant submits that on 2 July 2024, the Defendant, without any valid reason, provided the Claimant with AED 8,000 as full and final severance and requested for the Claimant’s bank account details which she provided.

11. On 3 July 2024, the Claimant confirmed her termination in writing, highlighting that her salary for the first month of work had not been fully paid.

12. The Claimant submits that her monthly salary is AED 25,000 as detailed in clause 1 of the Agreement. Therefore, her daily wage is AED 25,000 x 12 / 260 days = AED 1,153.85. She submits that the total salary due is in the sum of AED 17,499.33 and the Defendant has only paid the amount of AED 8,000. The remaining balance is AED 9,499.33.

13. The Claimant is also seeking penalties under Article 19 of the DIFC Employment Law as the Defendant failed to pay her entitlements within 14 days as provided by the Law which stipulates:

“(1) An Employer shall pay to an Employee all Remuneration (excluding, where applicable, any Additional Payments deferred in accordance with Article 18(2)), the Gratuity Payment and all accrued Vacation Leave not taken, within fourteen (14) days after the Termination Date.

(2) Subject to the provisions of Article 19(3) and 19(4), an Employee shall be entitled to and the Employer shall pay a penalty equal to an Employee’s Daily Wage for each day the Employer is in arrears of its payment obligations under Article 19(1).

(3) A penalty pursuant to Article 19(2) may only be awarded to an Employee if the amount due and not paid to the Employee in accordance with Article 19(1) is held by a Court to be in excess of the Employee's Weekly Wage.

(4) A penalty pursuant to Article 19(2) will be waived by a Court in respect of any period during which:

(a) a dispute is pending in the Court regarding any amount due to the Employee under Article 19(1); or

(b) the Employee's unreasonable conduct is the material cause of the Employee failing to receive the amount due from the Employer.”

14. The Claimant submits that she should be entitled to penalty charges from 15 July 2024 to 26 July 2024, being the date she sought to file this claim, in the sum of AED 12,692.35 calculated as follows: daily wage of AED 1,153.85 x 11 days.

15. In addition, the Claimant claims interest on the Judgment sum and cancellation and costs of absconding, if any.

The Defence

16. The Defendant submits that the Claimant was terminated for cause on 30 June 2024. The termination was due to misrepresentation of her skills, dishonesty about her client portfolio and involvement in potentially illegal activities with clients.

17. The Defendant submits that they terminated the Claimant’s employment by way of WhatsApp when they contacted her and requested that she return the Defendant’s property.

18. The Defendant submits that the Defendant incurred costs of AED 6,450 for the Claimant’s visa. In addition, the Defendant also claims the sum of AED 15,000 for the time wasted dealing with the Claimant’s claim.

19. The Defendant submits that the Claimant’s salary is AED 20,000 and not AED 25,000 as claimed. The sum of AED 25,000 is subject to the Claimant raising the sum of USD 200,000 every month until the sum of USD 1,000,000 is raised in accordance with clause 1 of the Agreement which provides the following:

“the Employer agrees to pay the Employee a gross salary of AED 25,000, payable within seven (7) days after the end of each pay period, which shall be every last Friday of the month.

Conditions to salary payments and Employment during probation: the Employee is required to raise USD 200,000 every month to continue employment with the company until USD 1 million is raised. If the Employee fails to raise that target amount of funds in the first month, she will receive only AED 20,000 of her salary, with the strict condition that she raise all required funds in the second month to continue receiving her full salary and continuing employment with the employer.”

20. The Defendant submits that the parties have agreed by way of WhatsApp that the Claimant will accept the sum of AED 8,000 as full and final settlement.

21. Therefore, the Defendant requests that the Claimant’s claim shall be dismissed and claim the sum of AED 6,450 for the Claimant’s visa and the sum of AED 15,000 for the time wasted dealing with the Claimant’s claim.

Findings

22. This dispute is governed by DIFC Law No. 4 of 2021 (Employment Law Amendment Law) (hereafter the “DIFC Employment Law”) in conjunction with the relevant Agreement.

23. Firstly, I shall decide the Claimant’s salary and interpret clause 1 of the Agreement. The Claimant calculated her monthly salary as being AED 25,000 without considering the condition which she has failed to fulfill. As per the Agreement, in order for the Claimant’s monthly salary to be AED 25,000 she is required to raise on monthly basis USD 200,000 until USD 1 million is raised. However, the employment was terminated prior to the Claimant fulfilling this condition. As such, I find that the Claimant’s salary is AED 20,000.

24. It is unclear whether the Claimant resigned as there is no evidence of her resignation. It is also unclear whether she has been terminated for cause. However, both parties agree that the employment relationship has ended.

25. The Defendant failed to provide evidence of termination for cause. Even if she was terminated for cause, she will still be entitled to receive her salary for the days she worked. However, she will not be entitled to receive payment for gratuity and notice. In any case, the Claimant has only claimed her salary for the 21 days that she worked at the Defendant’s company.

26. The question which arises is whether the payment made by the Defendant in the sum of AED 8,000 is full and final settlement of the employment relationship. The Defendant provided a WhatsApp conversation and argues that the Claimant’s response constitutes an acceptance of the offer. The WhatsApp conversation shows that the Defendant wrote to the Claimant and said that they will pay her the sum of AED 8,000 as full and final severance payment. The Claimant responded by setting out her bank details and received the sum on 2 July 2024.

27. I find that any deduction of salary is prohibited under the Employment Law as described in Article 20(1) of the DIFC Employment Law which provides:

“An Employer shall not deduct from an Employee’s remuneration or accept payment from an Employee, unless:

(a) the deduction or payment is permitted under this Law, or agreed to in an Employment Contract not in contravention of this Law;

(b) the prior written agreement of the Employee has been obtained in respect of the deduction or payment, provided that such deduction or payment is not prohibited under this Law;

(c) the deduction or payment is a reimbursement for an overpayment of any Remuneration or expenses, or to recoup benefits utilised by an Employee in excess of their accrued entitlement under their Employment Contract; or

(d) the deduction or payment has been ordered by the Court.”

28. Therefore, I find that the Claimant is entitled to the following sum as salary for 21 days from the period of 10 June 2024 to 30 June 2024, to be calculated as follows:

AED 20,000 x 12 month / 365 days = AED 657.54 x 21 days = AED 13,808.34 – AED 8,000 (already paid) = AED 5,808.34 is the Claimant’s entitlement as remaining unpaid salary.

29. In relation to the Claimant’s claim for penalties under Article 19 of the DIFC Employment Law:

“(1) An Employer shall pay to an Employee, within fourteen (14) days after the Termination Date:

(a) all Remuneration, excluding, where applicable, any Additional Payments deferred in accordance with Article 18(2);

(b) where applicable, any Gratuity Payment that accrued prior to the Qualifying Scheme Commencement Date under Article 66(1) not transferred to a Qualifying Scheme under Article 66(6);

(d) all outstanding amounts due in respect of the Employee under Article 66(7) not yet paid to a Qualifying Scheme.

(4) A penalty pursuant to Article 19(2) will be waived by a Court in respect of any period during which:

(a) a dispute is pending in the Court regarding any amount due to the Employee under Article 19(1); or

(b) the Employee's unreasonable conduct is the material cause of the Employee failing to receive the amount due from the Employer.”

30. I find that the Claimant is entitled to penalties under Article 19 of the DIFC Employment Law as the Defendant failed to pay her full remuneration within 14 days as required by the Law.

31. The Claimant’s claim penalties accrue from 15 July 2024 to 29 July 2024 and I shall calculate the penalties as follows:

AED 20,000 x 12 month/260 days = Daily wage of AED 923.07 x 15 days = AED 13,846.05.

32. In relation to the Defendant’s Counterclaim, this shall be dismissed on the following reasons:

In relation to the first limb of the Counterclaim, the claim of AED 15,000 for time wasted defending the Claimant’s baseless claim must fail as the Claimant has been successful in her claims.

In relation to the second limb of visa expenses in the sum of AED 6,450, Article 57(2) of the DIFC Employment Law provides:

“(1) If an Employee is required to work in the DIFC, their Employer is required to obtain and maintain, at the Employer's own cost, the requisite sponsorship documentation (including UAE and DIFC identity documentation), visas, authorisations, licenses, permits and approvals as may be required from time to time by Federal Law, Dubai Law, a Competent Authority or a Personnel Sponsorship Agreement, to enable the Employee to work lawfully for the Employer in the DIFC and comply with any such requirements.

(2) An Employer is not permitted to:

(a) recoup any costs and expenses incurred pursuant to Article 57(1) from an Employee; or

(b) retain the passport or other original personal documents of an Employee.”

33. Therefore, I find that the Defendant shall pay the Claimant the total sum of AED 19,654.39 plus interest at the rate of 9% from the date of this Judgment until the date of full payment.

34. I find that the Defendant shall pay the Claimant the sum of AED 393.08 as court fees.

35. The Defendant’s Counterclaim shall be dismissed and there shall be no order as to costs.

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Najwa v Nawaf [2024] DIFC SCT 312