Claim No: SCT 352/2023
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
BEFORE SCT JUDGE MAITHA ALSHEHHI
BETWEEN
MUBSID
Claimant
and
MIHAR
Defendant
| Hearing : | 7 December 2023 |
|---|---|
| Judgment : | 14 December 2023 |
JUDGMENT OF SCT JUDGE MAITHA ALSHEHHI
UPON the claim having been filed on 13 September 2023 and amended on 20 November 2023
AND UPON the Defendant’s defence dated 9 November 2023
AND UPON the partial consent order dated 9 November 2023 (the “Partial Consent Order”)
AND UPON a hearing having been listed before SCT Judge Maitha AlShehhi on 7 December 2023, 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 amount ofAED 46,843.25.
2. The Defendant shall pay the Claimant the DIFC Courts’ filing fee in the amount ofAED 936.86.
Issued by:
Hayley Norton
SCT Judge and Assistant Registrar
Date of issue: 14 December 2023
At: 9am
THE REASONS
Parties
1. The Claimant is Mubsid (the “Claimant”), an individual filing a claim regarding his end of service entitlements.
2. The Defendant is Mihar (the “Defendant”), a company registered in the DIFC, Dubai, UAE.
Background and Preceding History
3. The Defendant and Mubit (“Mubit”) entered into an agreement dated 21 April 2014 wherein the Defendant acted as a supplier for human resources services such as talent sourcing, recruitment, payroll solutions and ancillary services (the “HR Agreement”).
4. The Claimant and the Defendant entered into an employment agreement on 17 August 2021 in return for a salary of AED 30,000 to be supplied by the Defendant while the Claimant will be directly reporting to Mubit (the “Employment Agreement”).
5. Due to the Defendant’s alleged breaches of the HR Agreement, Mubit terminated the HR Agreement on 1 April 2023 with the notice period ending on 30 June 2023. One additional month (i.e. 31 July 2023) was subsequently agreed upon to facilitate the transition process of the employees to the new supplier of Mubit.
6. The Claimant initially filed a case with the Small Claims Tribunal (“SCT”) to claim the amount of AED 79,700.80 with respect to his July and August salaries, commission, end of service entitlement and DEWS payment.
7. The parties attended a consultation session on 9 November 2023 which resulted in a partial settlement of the claim and issuance of the Partial Consent Order.
8. I shall set out below the contents of the Partial Consent Order:
“IT IS HEREBY ORDERED BY CONSENT THAT:
1. The Defendant shall pay the Claimant the amount of AED 32,692.50 by way of wire transfer by no later than 15 November 2023.
2. The Claimant’s remaining claims in relation to payment for annual leave, commission and August salary shall be determined by way of a hearing to be listed by the Registry in due course.”
The Claim
9. Further to the Partial Consent Order, the Claimant is now seeking the total amount of AED 48,231.18 which comprises of AED 32,813.18 as final settlement and AED 15,418 as commission owed for the months of July and August 2023.
10. The Claimant submits that he is still owed his final settlement which was circulated to him by the Defendant on 7 August 2023 (the “Final Settlement”). The content of which is set out below:
“FINAL SETTLEMENT
Computation:
Start date 17 October 2021
End date 10 August 2023
Final Salary AED 10,714.29
Dews July 2023 – August 10, 2023 AED 1,387.93
Leave Encashment AED 19,500.00
Air Ticket AED 1,210.96
Total Final Settlement AED 32,813.18
I hereby certify and acknowledge that upon receiving the amount above, I will have received all dues owed to me by Emirates Consulting Group LLC .”
11. The Claimant concedes that he had been following up with the Defendant with regards to his end of service entitlements captured in the Final Settlement to no avail and argues that the Defendant has the funds but is withholding payment deliberately.
12. At the Hearing, the Claimant confirmed that he is still seeking the missing DEWS payment and submitted a screenshot of his DEWS account which demonstrates that there is no payment for July 2023.
13. Furthermore, the Claimant submitted a document entitled “compensation statement” which demonstrates the work that he has done and how much commission is owed to him, and based on this, he is claiming AED 15,418.
The Defence
14. The Defendant submits that due to its nature as a HR outsourcing firm, the Claimant ought to retrieve the remaining amounts from Mubit directly on the basis that the Claimant is not an internal staff member, and the HR Agreement had been terminated as of 1 August 2023. Therefore, it is not eligible to pay the August salary nor commission.
15. The Defendant further submits that Mubit only approved the billing of the July salary and the benefits that have already been paid out to the Claimant by virtue of the Partial Consent Order, and it is not in a position to provide anything else which had not been approved earlier by Mubit.
16. In support of this, the Defendant submitted a screenshot of an excel spreadsheet which shows the name of all of Mubit’s employees and the approved billing that should be paid by the Defendant as final payment following termination of the HR Agreement.
17. The Defendant rejects the Claimant’s assertion that his final day was 10 August 2023 and submits that his final day was 3 August 2023, as mentioned by the Claimant by way of email dated 26 July 2023“In light of this I am concerned about the process for next month as I am finishing with Mubit 3rd August”.
18. At the Hearing, the Defendant argued that the Claimant has always followed up with them with regards to his July salary and Final Settlement and never mentioned August salary nor commission until the claim was filed.
19. The Defendant concedes that the payment made in respect of the Partial Consent Order represents payment of July salary, bonus, claims and DEWS payment. Therefore, the Defendant submits that the Claimant cannot claim for the DEWS to be paid on the basis it has already been paid.
Applicable law
20. This dispute is governed by the DIFC Law No. 4 of 2021 Employment Law Amendment Law (the “DIFC Employment Law”) in conjunction with the Renewed Agreement.
Discussion
Is the Defendant eligible to pay the remaining amount to the Claimant given that the Claimant worked for Mubit and not directly under the Defendant?
21. The Claimant submits that when he reached out to Mubit, they advised him to collect the funds from the Defendant and submitted a screenshot of an email dated 17 August 2023 to confirm the same which reads as below:
“It is true that they only charged us with your last salary and not your final settlement but if they would intent to pay you, they would either contact us or at least pay you the last salary. They also have a deposit from Mubit from the beginning of our cooperation. So, all in all, they have plenty of money right now to pay you fully if they wanted.
As Mubit we are trying to get our money back from Mehun with legal representation, and we are deducting your proportional payment from the amount due to Mubit since we understand they will need the money to pay you out so, any future excuses from their side are just made-up reasons”.
22. Further to the above, this supports the Defendant’s defence that Mubit only approved the July salary and benefits without the Final Settlement.
23. Although I understand the Defendant’s argument that they cannot release any money which has not been approved by Mubit, I find that the Defendant ought to have included the Claimant’s Final Settlement in the bill to be approved by Mubit as the Claimant had already resigned in July and would not be in touch with Mubit’s new HR supplier. I arrived at this decision because there was an Employment Agreement between the Claimant and the Defendant, and it was the Defendant’s responsibility to provide such service and maintain the HR records and process payments.
24. Additionally, the Defendant failed to reach out to Mubit to advise upon the next steps in relation to the Claimant’s Final Settlement given that he was a departing employee.
25. The Final Settlement was circulated by the Defendant to the Claimant on 7 August 2023 i.e. after the termination of the HR Agreement. This means that the Defendant was aware that the Claimant is entitled to receive it and the amounts mentioned therein should have been paid by the Defendant as explicitly mentioned“I hereby certify and acknowledge that upon receiving the amount above, I will have received all dues owed to me by Mubi.”
26. I comprehend the Defendant’s argument that the Final Settlement was not billed to Mubit and that it is why they cannot pay the Claimant. However, I find that it was the Defendant’s duty to bill it and it failed to do so.
27. Therefore, I find that the Defendant is liable to pay the outstanding amount to the Claimant.
28. As the DEWS payment has already been paid due to the Partial Consent Order, I find that the Defendant must pay the Claimant the amount of AED 31,425.25 which represents payment of air ticket allowance, leave encashment and remaining salary as per the Final Settlement.
29. Likewise, I shall award the Claimant his commission for the months of July and August 2023 in the amount of AED 15,418 on the premise that he would have been paid this amount had the Defendant billed it to Mubit.
Findings
30. For the above cited reasons, I hereby order the Defendant to pay the Claimant the amount of AED 46,843.25.
31. The Claimant is entitled to recover the court fee applicable to the filing of this case which is proportionate to the judgment sum. The Defendant shall therefore pay to the Claimant the amount of AED 936.86.