Judicial principles and studies
Continued Employment and Releases in Repeated Fixed‑term Contracts
Summary explaining that releases signed while the worker remains employed are void, and that repeating fixed‑term contracts to strip employee rights conflicts with labour law and local service rules.
Updated: 10 September 2026
Prepared and reviewed by: Ashraf Al-Khawaja
Subject
The study examines the legal effect of a worker remaining employed on the validity of a release signed before the end of service, the legality of repeatedly concluding fixed‑term contracts to remove employee rights, and the interplay between labour law provisions and local service rules regarding end‑of‑service awards.
Summary
- A release signed while the worker is still on the job gives rise to a legal presumption that the waiver was coerced due to the worker’s need to keep employment and fear of dismissal, rendering such releases void under Article (4) of the Labour Law. - Repeated fixed‑term employment contracts that remove certain rights do not change the worker’s actual status; when aimed at forcing the worker to relinquish benefits, they conflict with Article (4/b) and result in invalidity. - Preferential rights granted by any other law, contract, agreement or decision take precedence for application under Article (1/4) of the Labour Law, so superior rights for the worker must be applied. - Local service rules (Article (25)) provide an additional award upon termination for employees with one year or more of service; this award is supplemental to the end‑of‑service entitlement calculated under the Labour Law (Article (32)) and does not reduce it. - The award under Article (25) becomes a vested right once its conditions are met; internal regulations (Article (2) of the employer’s internal system) that state the system’s provisions do not affect existing rights reinforce this protection. Note: This content is an educational summary and does not constitute a judicial text or legal advice.
Practical significance
- Releases signed while the employee remains employed are susceptible to challenge and cannot be relied upon to extinguish statutory rights. - Employing repeated fixed‑term contracts to strip rights may render such contractual arrangements or their restrictive clauses void. - Where local service rules grant superior entitlements, the worker may be entitled to the Labour Law end‑of‑service award plus the additional award under those rules if conditions are met. - Awards granted under internal service rules are vested benefits and should be observed on termination. Warning: This content is an educational summary and not a substitute for judicial text or legal advice.
Sources and references
Verify the official text and latest amendments before relying on this material professionally.