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Final Settlement Letter To Employee for United Arab Emirates

Final Settlement Letter To Employee Template for United Arab Emirates

A Final Settlement Letter is a formal document used in the United Arab Emirates that comprehensively details the final financial settlement between an employer and a departing employee. Governed by UAE Federal Decree-Law No. 33 of 2021, this document outlines all terminal benefits, including end of service gratuity, unused leave encashment, final salary, and any other outstanding payments or deductions. It serves as a legal record of the complete settlement of all financial obligations and typically includes confirmations regarding the return of company property and the termination of employment-related benefits.

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Final Settlement Letter To Employee

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What is a Final Settlement Letter To Employee?

The Final Settlement Letter To Employee is a mandatory document under UAE labor law that formalizes the conclusion of an employment relationship. It must be prepared when an employee's service with a company terminates, whether through resignation, termination, or mutual agreement. The letter serves multiple purposes: it documents the final financial settlement including all entitlements and deductions, provides legal protection for both parties by clearly stating all obligations have been fulfilled, and complies with UAE Federal Decree-Law No. 33 of 2021 requirements for employment termination documentation. This document is particularly important in the UAE context where end of service benefits are strictly regulated and documentation requirements are stringent. It helps prevent future disputes and is often required for visa cancellation and new employment processes.

What sections should be included in a Final Settlement Letter To Employee?

1. Letter Header: Company letterhead, date, reference number, and employee details including employee ID

2. Subject Line: Clear indication that this is a Final Settlement Letter

3. Employment Details: Confirmation of last working day, position held, and duration of employment

4. Settlement Components: Detailed breakdown of all payment components including final salary, end of service gratuity, leave encashment, and any other entitlements

5. Deductions: Clear listing of any applicable deductions such as advance payments or loans

6. Net Settlement Amount: Final amount payable after all calculations and deductions

7. Payment Method: Details of how and when the settlement amount will be paid

8. Clearance Declaration: Statement confirming all company property has been returned and obligations fulfilled

9. Full and Final Settlement: Legal statement confirming this as full and final settlement of all claims

10. Signature Block: Space for signatures of authorized company representative and employee

What sections are optional to include in a Final Settlement Letter To Employee?

1. Non-Compete Reminder: Include when the employee's contract contains non-compete clauses that remain effective after termination

2. Confidentiality Obligations: Include when emphasizing ongoing confidentiality obligations is necessary

3. Reference Provision: Include when the company agrees to provide employment references

4. Pending Benefits: Include when there are outstanding benefits like medical insurance extension or flight tickets

5. Visa Status: Include for expatriate employees regarding visa cancellation procedures and timeline

6. Notice Period Settlement: Include when there are specific arrangements regarding notice period (whether served, paid in lieu, or waived)

What schedules should be included in a Final Settlement Letter To Employee?

1. Settlement Calculation Sheet: Detailed breakdown of all calculations including gratuity, leave balance, and other entitlements

2. Company Property Checklist: List of company assets returned by the employee

3. Outstanding Loans/Advances Statement: If applicable, detailed statement of any outstanding loans or advances and their settlement

4. Benefits Status Report: Status of various benefits and their termination dates (medical insurance, etc.)

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Document Type

Employment Form

Cost

Free to use
Relevant legal definitions




















Clauses




















Relevant Industries

Banking and Financial Services

Construction and Real Estate

Technology and Communications

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Healthcare

Retail and Hospitality

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Government and Public Sector

Energy and Utilities

Relevant Teams

Human Resources

Finance

Legal

Payroll

Administration

Compliance

Employee Relations

Corporate Governance

Relevant Roles

HR Manager

HR Director

Finance Manager

Legal Counsel

Payroll Manager

HR Business Partner

HR Operations Manager

Compensation and Benefits Manager

HR Administrator

Finance Director

Company Secretary

Chief Human Resources Officer

Employment Law Specialist

HR Compliance Officer

Administrative Manager

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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