A quick guide to staff demobilisation in Qatar

Following the Qatar 2022 World Cup, many employers in Qatar must now start to consider the demobilisation of their project staff or mobilise staff for new projects and events. In this article, we provide a brief summary of the key provisions regulating demobilisation in the context of the Labour Law (Qatar Law No.(14) of 2004), the terms of which govern the employment of the majority of expatriate employees in Qatar.

Termination with notice

The 2020 changes to the Labour Law (Article 49) provide that a contract with any duration, e.g. definite or indefinite, may be terminated, either by the employer or the employee, providing written notice at any time once probation has been successfully completed. Whilst there is no requirement for the party serving notice outside of probation to provide a reason for the termination; notice may only be given by an employer during probation for poor performance, but can be given by an employee to transfer employment or to repatriate.

Notice must be at least one month if the period of service with the same employer is less than two years, and two months for employees who have been employed by the same employer for more than two years, save where the employment contract provides for a longer notice period.

Sanctions

Every employer who employs more than 10 employees should have in place a list of disciplinary sanctions approved by the Ministry of Labour which shall not be more onerous than those set out in the standard by laws and table of penalties updated and issued from time to time by the Ministry of Labour. 

Sanctions include the employer issuing a written warning to the employee, making deductions against wages, suspension and/or dismissal with or without the payment of end of service gratuity (EOSG).

Termination without notice

The Labour Law (Article 61) entitles an employer to terminate an employee's employment with immediate effect, if the employee commits one of 10 stated acts of gross misconduct; given historic abuse of this ability to terminate by employers, the requirement to evidence gross misconduct is high.

No Termination

Termination of employment is not automatic on the death of an employer or the merger or transfer of ownership or management of an employer per se (Article 52).  In addition, the termination and resumption of employment within two months (Article 54) shall be considered continuous employment.

Restructuring

The Labour Law (Article 52bis) requires any employment terminations for economic reasons, rather than performance or other employment contract related reason, to be reported to the Ministry of Labour in writing at least 15 days before termination.

Entitlements

Upon termination, the employer will be required to pay the employee any and all statutory and contractual sums which are due to the employee, including, notice pay, EOSG, any accrued but untaken leave, any approved but unpaid expenses and any additional sums which may be due.

Payment (Article 67) of all entitlements to the employee should be completed by the end of the day following the termination of the employee’s employment.  Where an employee dies in service his or her entitlements should be paid into the Family Court (Article 55) within 15 days of the date of the death so that the court can distribute the employee’s entitlements to the heirs.

An employee may request, free of charge, a salary certificate to be issued on termination; all of the employee’s documentation, e.g. certificates, should also be returned to him or her (Article 53).

End of service gratuity

Who qualifies?

The Labour Law (Article 54) provides that, in addition to any sums to which the employee is entitled to upon termination or expiry of their employment contract, the employer is obliged to pay EOSG if the employee has completed a minimum of one year of continuous service. This is subject to the employee’s employment not being terminated without notice for gross misconduct. The employee is also entitled to be paid EOSG, pro-rata, for fractions of service, i.e. part years in employment once one full year has been worked.

How is it calculated?

EOSG can be contractually agreed between the parties provided it is not less than three weeks’ of the employee's final basic salary for each completed year of service. EOSG is usually calculated using calendar days but may be calculated using working days if more appropriate, given the particular working practices in a specific industry.

Any periods of valid leave such as sick leave, annual and maternity leave should be included in the calculation. However, any periods of unpaid leave will generally be excluded depending on the circumstances.

If the employee's period of service with the employer pre-dates the introduction of the Labour Law, i.e., 6 January 2005, we would advise that legal advice is taken when calculating EOSG given some of employment may be calculated in accordance with the terms of the previous Labour Law (Qatar Law No. (3) of 1962).

Deductions from EOSG

The employer is entitled to deduct from the employee's EOSG any amounts that the employer is owed by the employee. The employer should consult with the employee before any deductions are made, and where possible, reach agreement with the employee regarding the proposed reductions in order to avoid disputes.

When is EOSG payable?

In accordance with the Labour Law (Article 67) EOSG is to be paid before the end of the day following termination of employment. 

EOSG v Pension Arrangement

There is an exception to the payment of EOSG (Article 56). If the employer has in place a retirement scheme or any other similar system that guarantees the employee a gratuity or net privilege at the end of service which is more generous than the statutory compensation calculation for EOSG, the employer is not obliged to pay EOSG in addition. Practically it is often difficult to determine which benefit is the most generous; in addition, it is the employee who will have the final say as to which benefit is paid.

Immigration Considerations

All expatriates entering Qatar to work must hold valid work permits; on arrival, employers have 30 days to apply for the employees’ residence permits.

If an individual is no longer employed, the employer must repatriate the employee, and by inference cancel his or her residence permit within two weeks of termination (Article 57) or transfer their employment to a third party.

If an employer dies whilst in service, the employer must repatriate his or her body to their home country (Article 57). The employer will be responsible for repatriating the employee and their dependent(s) (if applicable) to their home country.

Note: Qatari Laws (save for those issued by, e.g. The Qatar Financial Centre (QFC) to regulate its own business), are issued in Arabic and there are no official translations, therefore for the purposes of drafting this article Clyde & Co LLP has used its own translations and interpreted the same in the context of Qatari laws, regulation and current market practice. Contact Emma Higham or Corrine Sobers for further information.