Limited Contracts: Understanding Fixed-Term Employment in UAE

Key Characteristics of Limited Contracts

Starting out your journey to employment in UAE? Then you must know about the types of contracts. There are two types of contracts such as limited contracts and unlimited contracts.

If you want to learn about limited contracts in the UAE, then you are in the right place. In this article, we cover every detail of a limited contract which includes

  • What is a limited contract UAE
  • Which is better for you, a limited contract or an unlimited contract
  • Job security and benefits of limited contract

And more, so without wasting a minute let’s get started!

What is the limited contract in UAE?

A limited contract is an employment agreement in the UAE. Previously, it is no longer than 3 years. However, now the duration has no limit. The employee and employer can mutually decide about it.

Additionally, the agreement can be renewed for a similar period or a shorter period of time on mutual decision. The limited contracts are often used for temporary and project-based work

Which is better, a limited or unlimited contract in the UAE?

The limited contract is for a shorter period of time. The time is already set by both parties. The limited contracts are used by companies to hire project-based employees.

On the other hand, unlimited contracts provide more flexibility. It doesn’t have a set end date. It is only terminated by mutually decided by both employees and employers

The unlimited contracts are better for both parties as there is not set date for agreement expiration. Also, it provides the right to employers and employees to end the agreement whenever they want

However, for project-based tasks, the limited contracts are better

Can I resign after 1 year in a limited contract?

The employees often have this question in mind can I resign after 1 year in UAE limited contract?

The answer is yes! As an employee, you can resign after one year of a limited contract. The employee with a limited contract resigns during the probation period. They are free to quit their jobs or leave the country. But they are required to provide 14 days written notice in advance.

Job Security and Benefits

The limited contract provides several benefits to employees and employers. A few of them are discussed below:

  • Under limited contract, the employers have the flexibility to hire and terminate the employee as they desire
  • It allows employees to try a new opportunity before committing to a long-term contract
  • The limited contract helps in protecting employers’ property and other confidential information

Making Limited Contracts Work

Few considerations have been taken into account when enter into a limited contract in the UAE. For both employee and employer, it is necessary to understand this for a seamless employment experience

Negotiating Terms and Conditions

At the time of contract, the employee has a right to negotiate. Both parties must need to agree on certain terms and conditions. It includes the duration of the contract, the possibility of renewing it, the agreed pay rate, and others.

Performance Expectations and Evaluations

During a limited contract, the employee and employer need to communicate effectively. The employer and employee have to clear the job responsibilities and goals. On the other hand, employers set performance expectation that aligns to job role of the employee

Transitioning After Contract Ends

After the job ends, it is the authority of an employee to fulfill some obligations. They are required to transfer their responsibilities to other colleagues. Returning to company assets is also essential.

In addition to this, the employers need to settle any outstanding financial matters. It includes final salary payments and end-of-service benefits

For employees, networking and updating their resume can facilitate a new opportunity. It is necessary to do so for a seamless transition to new employment opportunities in the UAE job market.


In conclusion, employees who want to start their employment in the UAE must know about employment contracts. The two employment contracts are limited and unlimited contracts. Limited contracts are best for short-term projects. However, the unlimited contracts offer flexibility to both parties. They are free to terminate the contract whenever they want. Both contracts have their pros and cons. It is advisable for employees and employers to choose the contract based on their circumstances

Do you want to learn more about employment topics? You can check the Emiritisation website. Here you can learn plenty of job-related topics


What is a new labour law for limited contract in uae?

According to Mohre limited contract, initially, the duration for a limited contract was 3 years. However, this rule is now modified. Now, there is no limit. The employee and employer can decide mutually on the duration of the contract

What is limited contract in UAE?

The limited contract is a type of employment contract in the UAE. According to this contract, the employers can hire employees for shorter period of time or for project based tasks. The contract can be renewed for a similar period or sometimes for a shorter period

Can an employee resign under a limited contract in the UAE?

The employee can resign as per the UAE labor law. But it is mandatory to mention this at the time of contract in the agreement


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