Dubai Court of Appeal Confirms Mandatory MOHRE Referral for Employment-Related Claims

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Case note: Dubai Court of Appeal, Civil Appeal No. 1207 of 2026, decision dated 18 June 2026

A recent Dubai Court of Appeal decision confirms that a claim arising in substance from an employment relationship must follow the statutory dispute-resolution procedure before proceedings are commenced in court.

The requirement applies whether the claim is brought by an employee or an employer. It cannot be avoided merely by characterising the dispute as an independent civil or contractual claim.

Background

The dispute arose following the termination of a senior employee.

Under the employment offer, the employee received certain initial financial benefits and incentives. Following termination, the employer carried out a reconciliation of the parties’ respective entitlements and sought repayment of an alleged outstanding balance.

The employer commenced civil proceedings after referring the dispute to the general Amicable Settlement Centre. It did not, however, first submit the dispute to the Ministry of Human Resources and Emiratisation, or MOHRE, under the statutory procedure applicable to employment disputes.

The Dubai Court of First Instance held that the claim arose from the employment relationship and dismissed it as inadmissible because the employer had not followed the procedure prescribed by Article 54 of Federal Decree-Law No. 33 of 2021 Regulating Labour Relations. The employer appealed. 

Substance prevailed over the description of the claim

On appeal, the employer argued that its claim arose from an independent contractual repayment obligation rather than from any right governed by UAE labour law.

The Court of Appeal rejected that characterisation.

In determining the true nature of the relationship, the Court considered the employment offer and the surrounding evidence. The offer identified the position, monthly salary, allowances, incentives and employment term, and contemplated the execution of a formal employment contract following approval of the work visa.

The Court also considered correspondence concerning cancellation of the employment, the provision of an experience certificate, the employee’s period of service and changes to remuneration. A permanent access card issued for the relevant free zone further supported the conclusion that the individual had worked for the company.

Taken together, those documents established an employment relationship. The repayment claim concerned benefits and financial incentives received under that relationship and could not be separated from it merely by describing the obligation as contractual or civil. 

The MOHRE procedure was mandatory

Article 54 requires disputes concerning rights arising from an employment relationship to be submitted first to MOHRE.

The purpose of the procedure is to allow the Ministry to examine the dispute, summon the parties and seek an amicable resolution before the matter proceeds through the statutory route to the competent court.

The Court treated this as a mandatory precondition to the admissibility of the claim. Referring the matter to the general Amicable Settlement Centre did not replace or satisfy the separate procedure required for an employment dispute.

Because the employer had not established that it submitted the claim to MOHRE before commencing proceedings, the claim had been brought through the wrong procedural route. The Court of Appeal therefore dismissed the appeal and affirmed the first-instance judgment. 

The decision did not determine the repayment claim on its merits

The decision is procedural.

The courts did not determine whether the relevant incentive or benefit provisions created an enforceable repayment obligation, whether the employer’s calculation was correct, or whether the employee ultimately owed the amount claimed.

The claim was dismissed because the mandatory pre-litigation procedure had not been followed. A dismissal on that basis is materially different from a judgment rejecting the underlying contractual entitlement after examination of the merits.

This distinction is important when assessing the consequences of the decision and any further procedural options that may be available.

Practical significance

The decision provides an important reminder for employers seeking to recover sign-on payments, joining incentives, relocation benefits, training costs, advances or other employment-related sums.

The legal characterisation of the claim will be determined by its substance and its connection to the employment relationship, not simply by the label used in the pleadings.

Where the alleged repayment obligation arises from an offer of employment, employment contract, incentive arrangement or termination reconciliation, the statutory labour-dispute procedure should be considered before any court proceedings are commenced.

Employers should therefore:

  • identify the correct pre-litigation forum before filing;
  • review whether the disputed payment arose from or was conditional upon employment;
  • preserve the employment offer, payment records, termination correspondence and reconciliation documents; and
  • ensure that the MOHRE process and any resulting referral are properly documented.

The judgment also demonstrates that using a general settlement mechanism will not necessarily cure a failure to follow the specific procedure prescribed for employment disputes.

Conclusion

The Dubai Court of Appeal’s decision confirms that an employer cannot bypass the statutory labour-dispute process by presenting an employment-related recovery claim as an independent civil obligation.

Where the factual and documentary record establishes that the payment arose from the employment relationship, the dispute must first proceed through the mechanism prescribed by Article 54 of the UAE Labour Relations Law.

For employers, the decision underlines a straightforward but important point: the correct procedural route should be established before the merits of the recovery claim are pursued.

DISCLAIMER

This publication is provided for general information only. It does not constitute legal advice and should not be relied upon as such. The outcome of any matter will depend on its particular facts, documents and applicable law. Specific legal advice should be obtained before taking or refraining from taking any action.

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CATEGORY: Jurisdiction, Procedure & Appeals |
Commercial & Contract Disputes |
Arbitration, Enforcement & Interim Relief

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