The key legislation addressing employment issues in Jordan is Labour Law No 8 of 1996 (the Labour Law or the Law) and the regulations, directives and resolutions issued pursuant to it; as well as the Civil Code, which contains the general principles governing the contract of employment.
In addition to the list of orders issued under the Defence Law since the onset of the COVID-19 crisis (detailed in 1.2 COVID-19 Crisis), an amendment to Labour Law was passed in 2019 (Amending Law No 14 of 2019) that included a review of a number of aspects of the Labour Law.
The most significant changes introduced by Amending Law No 14 of 2019 are the following:
On 17 March 2020 a royal decree was issued ratifying a resolution of the Council of Ministers to activate Defence Law No 13 of 1992 (the Defence Law).The Defence Law permits the Prime Minister to issue a set of written instructions or orders that are known as “Defence Orders” for the purpose of addressing exceptional circumstances that threaten national security or public safety.By virtue of the Defence Orders, the Prime Minister has the power to suspend the operation of ordinary laws.However, the effect of the Orders, as well as any measures taken pursuant to them, is temporary as it ceases once a royal decree is issued announcing the return of the Defence Law to its inactive or “dormant” state.
Since the onset of the crisis, a number of Defence Orders, and related resolutions and announcements, have been issued by the Prime Minister to address employment issues arising in these circumstances, such as the payment of salaries and the termination or renewal of work contracts.Some of these resolutions and announcements are reviewed and updated every two months to keep pace with the changing circumstances and the gradual lifting of restrictions on movement and trade that had previously been imposed.
From an employment perspective, the most significant resolutions that are currently in force are the following:
There is no distinction under Jordanian law between blue-collar and white-collar workers. The main types of employment, as detailed under 2.2 Contractual Relationship, are:
In addition to the above, the Flexible Employment Regulation No 22 of 2017 introduced the following types of employment:
A worker employed under any of the foregoing flexible arrangements is entitled to all the rights of a regular employee, except that pay must be commensurate to the actual working hours during a given month (provided that it is not less than the legal minimum wage) and leaves must be prorated according to the agreed working hours under the arrangement.
A contract may either be concluded for a fixed period (a fixed-term contract), in which case, it expires upon the end of its term; or for an indefinite period (an indefinite-term contract), where it is terminated by either party by virtue of a notice or when the employee reaches the age of retirement. A fixed-term contract, however, will turn to an indefinite contract if the parties continue performing it beyond its date of expiry. The main difference between these two types of contracts, in terms of the implications for termination, is that the employee on a fixed-term contract would be entitled to his or her salary for the rest of the term if terminated by the employer prior to expiry; while in the case of indefinite contracts, unjust termination may result in compensation for the employee at the rate of half a month’s pay month for each year of service.
Employment contracts may be written or verbal. If the contract is not in writing, however, the Law allows the employee to prove his or her employment rights by all legal means of evidence.
If written, the work contract must be drafted in Arabic and in two copies at least. In the event that the employee is a non-Arab, a translation into a foreign language must be attached to the Arabic version. The Labour Law does not provide for any requirements with regard to the terms to be included in the contract.
Limitations on Working Hours
The Law imposes a maximum cap of eight working hours per day or 48 hours per week, except in a number of exceptional circumstances specifically provided for in the Law. This cap is exclusive of any lunch or break times that may be granted by the employer.
The above working hours do not apply to minors below 16 years of age, as they may not work for more than six hours a day and they must be given a one-hour break following any consecutive four-hour work period. Minors are also prohibited from working between 8pm and 6am, on weekends, and on public and religious holidays.
The Resolution on the Occupations and Times in which Employment of Women is Prohibited, which was issued by the Minister of Labour in 2010, also prohibits the employment of women between 10pm and 6am, except in specified occupations and sectors (such as restaurants, hotels, theatres, hospitals, transportation, and information technology). The Resolution also provides that there must be at least ten hours separating the end of the workday and the start of another for a female employee.
Please refer to 2.2 Contractual Relationship with regard to flexible work arrangements.
Where the employee performs work beyond the number of hours provided for in the work contract or, if the contract is silent, the number of daily or weekly hours prescribed by the Law, that work is considered as overtime employment requiring the approval of the employee and entitling the employee to overtime pay.
Payment for overtime work is based on the hour. For an hour of overtime, the employee must be paid at least 125% the normal working hour. If overtime work is requested during a public holiday or over a weekend, the hourly rate becomes 150%.
An employee would also be entitled to the above-mentioned overtime pay for the following purposes where overtime work is considered mandatory:
It must be noted that the above rules with regard to limits on working hours and overtime pay do not apply to persons in management or general supervision positions or to those whose positions require that they work outside the employer’s establishment at times or that they travel within or outside Jordan.
Minimum Wage Requirements
The mandatory minimum wage is determined by a tripartite committee formed of representatives from the Ministry of Labour, employers and workers and appointed by the Council of Ministers. Resolutions of the committee in this regard must be issued unanimously, or otherwise the minimum wage is determined by virtue of a resolution of the Council of Ministers. According to the latest resolution issued by the tripartite committee in 2017, the minimum wages was fixed for Jordanians at JOD220 (approximately USD310). For non-Jordanians, it is JOD150 (approximately USD 211) pursuant to a resolution issued by the committee in 2008.
Entitlement to Thirteenth Month Pay, Bonuses, Etc
According to the Labour Law, pay includes “all that to which the employee is entitled, whether cash or in kind, in return for his or her work in addition to all other dues of any kind if the payment thereof is provided for by the law, the contract of employment or internal regulations or if it has become an established practice to pay such dues, …".
Accordingly, there is no obligation on the employer to pay any kind of bonuses or allowances, including thirteenth month pay or any other kind of benefit. However, if such additional benefits are granted to employees under the employment contract or employer’s bylaws, such benefits become an acquired right and all contractual stipulations by which any employee waives any of the rights conferred upon him or her by the Law are considered invalid.
Vacation and Vacation Pay
Employees are entitled to the following leaves:
Employees are also entitled to fully paid public holidays that are announced by the Council of Ministers. Such announcements are usually issued a few days prior to each holiday, but usually include the following: new year’s day, labour day (May 1st), independence day (May 25th) and Christmas Day (December 25th). Public holidays also include Eid-al-Fitr, Eid-al-Adha, the Islamic new year and Prophet Mohammad’s birthday, the dates of which are not fixed as they are based on the lunar (Hijri) calendar.
Confidentiality, Non-Disparagement Requirements
As part of the employee’s obligations that are specifically provided for under the Labour Law, the employee is bound to maintain the confidentiality of the employer’s industrial and trade secrets and is prohibited from disclosing such information even after the termination or expiry of the work contract.
As mentioned under 7.3 Dismissal for (Serious) Cause (Summary Dismissal), the disclosure of confidential information pertaining to the employer is one of the grounds that entitle the employer to terminate the work contract with immediate effect.
As an exception to the general rule that each person is only liable for his or her own acts, the Civil Code allows for claiming compensation from the person who has actual authority over the individual who was found liable for having caused the damage, if such damage was caused by the latter during, or by reason of, the performance of his or her work duties. Courts have ordered employers to pay compensation for damage caused by their employees in several cases based on this provision. In such cases, however, the employer may reclaim the amount from the employee.
The Jordanian Civil Code provides that if an employee performs work that permits him or her to gain knowledge of work secrets and be acquainted with the customers of the employer, the parties may include a provision in their agreement that prevents the employee from competing with the employer or participating in any competitive business after termination of the work contract. Such provisions, however, must be restricted in terms of duration, place and type of work to the extent necessary for the protection of the employer’s legitimate interests.
If the parties agree that the employer shall be compensated in case of breach of the non-compete clause and the amount of such compensation is exaggerated for the purpose of compelling the employee to stay with the employer, then such provision is considered to be invalid.
In assessing whether or not there is a breach of the non-compete clause in the contract, courts consider whether or not the type of work performed by the employee for the new employer constitutes competition with the previous employer and whether the information to which the employee had access while working for the previous employer is indeed confidential or is available in the public domain.
Neither the Labour Law nor the Civil Code contain any provisions on non-solicitation clauses in contracts. Though there is nothing that prohibits the inclusion of such clauses, the award of compensation for the breach of a non-solicitation clause will largely depend on whether or not any damage is actually sustained by the employer and the extent of such damage.
Apart from a few provisions pertaining to data privacy that are contained in some pieces of Jordanian legislation, such as the Banking Law, which provides for the protection of the secrecy of bank accounts, Jordan does not currently have a specific piece of data privacy legislation. A draft Personal Data Protection Law was submitted to the Jordanian Parliament in 2017 but has still not been passed.
Foreign employees may only be appointed with the approval of the Ministry of Labour and they are required to have a “work permit” issued by the Ministry in addition to a residence visa. The approval of employment of non-Jordanians is subject to two restrictions:
In addition to the above, a resolution issued by the Ministry of Labour reserves a number of occupations for Jordanians and defines them as "closed occupations". The list of closed occupations is updated from time to time by the Ministry subject to the needs of the local market.
Foreign workers may only be employed after the issuance of a work permit from the Ministry of Labour. The permit is issued for a period of one year and is subject to annual fees. The residence visa is only issued to the foreign worker upon obtaining the work permit.
Trade unions are regulated by the Labour Law and are considered to enjoy a legal personality as of the date of their registration at the Unions Register within the Ministry of Labour. The Law provides that unions are established to realise the following objectives:
The Labour Law only recognises trade unions as representative bodies of employees. The concept of a “labour/employee representative” was introduced in the recent amendment to the Law that was passed in 2019 in reference to the representatives of unions within a work establishment. This amendment provides that the tripartite committee must establish criteria “pursuant to which representatives of trade unions may perform their functions, including the conditions for the reduction of work hours or full-time trade union activity, as well as making available the financial means required for this purpose, taking into consideration the resources of the establishment and the number of its employees”.
This provision remains practically inoperative, however, as the said criteria have not yet been issued by the tripartite committee.
Collective bargaining may take place between employers and a trade union, at the request of either of them, to address work conditions. According to the Law, a meeting must be held at least twice annually between the trade union and the employer in establishments that employ 25 or more workers for the purpose of organising and enhancing working conditions and workers’ productivity, as well as negotiating any related matters. The negotiations must start within 21 days of the date on which notice is given by one party to another regarding the subject of the negotiations and reasons justifying them. A copy of the said notice must also be sent to the Ministry of Labour within a maximum of 48 hours of its issuance.
Once a collective agreement is reached, it is required to be registered with the Ministry of Labour and is considered to be binding as of its date or, if such date is not specified, the date of its registration.
A collective agreement is binding on:
In addition to the above, upon conducting the appropriate studies, the Ministry of Labour may extend the scope of a collective agreement that has been implemented for more than two months to include all the employers and workers in a particular industry or in a specific area.
A collective agreement may be concluded for a defined term that does not exceed three years or for an undefined term. In the case of an agreement with an undefined term where at least two years have elapsed since its implementation, either party may notify the other of its wish to terminate or amend the agreement, in full or in part by virtue of a one-month notice.
The termination or expiry of a collective agreement does not entitle the employer to take any measure that compromises the rights acquired by the employees covered by its terms. Furthermore, any provision in an individual employment agreement with a worker who is covered by a collective agreement is considered null and void if it contradicts a provision in that collective agreement, unless it provides the worker with more beneficial rights.
Termination at will is only permitted during probation, in which case termination does not need to be based on any cause and the employee would not be entitled to any notice or compensation.
There are certain cases, generally known as the grounds of Article 28 of the Law, in which the employer may terminate the employment contract without notice in the case of an indefinite term contract and prior to the end of the term in case of a fixed-term contract. These are the grounds listed under 7.3 Dismissal for (Serious) Cause (Summary Dismissal).
Termination of Fixed-Term Contracts
As a general rule fixed-term contracts end upon the expiry of their term. If the employer wishes to terminate such a contract prior to the expiry of its term, and unless termination is based on a violation by the employee of the provisions of the Law as mentioned above, termination will entitle the employee to all his or her salary for the remaining period of the contract. If terminated by the employee prior to its date of expiry, on the other hand, the employer may be entitled to claim compensation from the employee for the loss and damages resulting from early termination, but the amount of compensation is determined by the court at its sole discretion and it is capped at a maximum amount equivalent to half of the monthly salary of the employee for the remaining term of the contract.
Termination of Indefinite-Term Contracts
In an indefinite-term contract, either the employer or the employee may terminate the contract upon a one-month written notice. The employer may either exempt the employee from working or require him or her to work during the notice period, except in the last seven days of the notice period. The employee is entitled to pay for the period of the notice unless terminated based on one of the grounds of Article 28 of the Law, in which case the contract may be terminated by the employer without notice.
Additional Grounds for Termination
In addition to the foregoing, contracts may also be terminated with the mutual agreement of the parties, if the employee becomes unable to perform his or her job due to illness or disability pursuant to a medical report, or in the case that the employee reaches the age of retirement.
There are also certain cases in which the employee is entitled to resign without giving notice and without forgoing any legal entitlements:
If economic or technical circumstances require the termination or suspension of all or some of the employees, the employer may terminate or suspend indefinite-term employees, provided that the Ministry of Labour is notified by the employer in writing of the decision and that the reasons that justify taking this action are explained.
In such a cases, a special committee formed by the Ministry for this purpose assesses the situation and makes its recommendations to the Minister of labour. If the Minister approves the termination, the terminated employees are entitled to be reinstated to their original positions if the conditions of the employer improve within one year of their termination
Notice is required for the termination of indefinite-term contracts, where either party may terminate the contract upon a one-month written notice, unless the contract provides for a longer period.
The employee is entitled to be paid during the notice period and the employer can request the employee to work during said period except for the last seven days thereof. If the employer wishes to terminate the employee with immediate effect, however, payment must be made in lieu of notice.
The Law does not require any specific form or procedure for the notice of termination of an employment contract.
Only in cases where the terminated employee is not subject to the Social Security Law, termination results in an obligation on the employer to pay an “end of service compensation” to the employee at the rate of one month’s pay for each year of service, calculated on the basis of the last salary received by the employee.
The following causes justify termination without notice in the case of indefinite-term contracts, and without compensation in the case of fixed term contracts, in accordance with Article 28 of the Labour Law:
Termination agreements and releases are recognised and enforceable and do not require any specific procedure or formality.
In order for the termination agreement and release to be enforceable, however, the employer must ensure that no pressure or duress is exercised on the employee and that there are no terms in the agreement or the release by which the employee waives any of the legal entitlements. Otherwise, such terms will be considered invalid. In this context, employers are advised not to procure releases from employees during the notice period, as courts have regarded this as an indication of duress since the employee is still under the control of the employer during such time. Therefore, they have ruled that the dismissal of an employee in this case is an unjust termination requiring compensation.
Employment agreements may not be terminated, nor notice of termination given, in any of the following cases:
In addition to that, the Law expressly provides that no employee may be terminated on account of a complaint or claim submitted to the competent authorities, which include courts of jurisdiction and the Remuneration Authority within the Ministry of Labour (see 9.1 Judicial Procedures), in relation to the implementation of the provisions of the Labour Law.
Any measure taken by the employer against an employee who is a representative of a trade union, including the termination of such an employee, is considered invalid where such measure is taken against the employee on account of an activity related to the union. The court may order the employer to reinstate the representative and pay all his or her salary for the period of his or her dismissal or, otherwise, to pay compensation that ranges between six to 12 months’ salary in addition to the compensation due for unjust termination.
If an employee under an indefinite-term contract is terminated “unjustly and in violation of the provisions of the Law”, that termination is considered to be an arbitrary (unjust) termination entitling the employee to claim reinstatement or compensation. In practice, courts order compensation for the employee rather than reinstatement. Compensation for unjust termination is calculated on the basis of the most recent salary received by the employee and at the rate of half a month’s salary for each year of service, provided that the minimum compensation amount is a two months’ salary.
Though it is the practice of most courts in Jordan to consider any termination of an indefinite contract that is not based on the grounds specified in Article 28 of the Law (please refer to 7.3 Dismissal for (Serious) Cause (Summary Dismissal)) as unjust termination requiring compensation, some courts are slowly moving away from this trend. There have been some cases recently where courts have ruled that the termination of an indefinite-term contract by virtue of a notice is consistent with the provisions of the Labour Law, as the said Law does not intend for such contracts to be “eternal or infinite”.
The only type of discrimination recognised under Jordanian Labour Law is gender-based discrimination in terms of wages. This is defined as the payment of less wages for work of equal value based on the gender of the employee. The Law imposes a monetary penalty on employers who discriminate in pay between employees on the basis of gender in an amount ranging from JOD500-1,000 (approximately USD700-1,400) in addition to payment of the difference in wages to the employee who is discriminated against. In case of a repeated violation of this provision, the monetary penalty is doubled.
The burden of proof in such claims is on the claimant pursuant to the general rules of evidence in the Civil Code.
The “Remuneration Authority” is an entity comprised of one or more persons appointed for a specific jurisdiction for the following purposes:
Disputes arising out of individual employment contracts fall within the jurisdiction of the Small Claims (Magistrate) Court.
A collective labour dispute is one that arises between an employer and a union in relation to the implementation or interpretation of a collective agreement or to employment terms and conditions. Such disputes are first referred to a conciliation officer at the Ministry of Labour, whose function is to assist the parties in reaching a settlement for their dispute and possibly concluding a collective agreement. If the conciliation officer fails to help the parties arrive at a resolution for their dispute within 21 days of its referral, the Minister of Labour refers it to a conciliation board appointed by the Minister and formed of two members representing each of the disputant parties and presided over by a chairman with no connection to either party. In the case that the conciliation board is also unable to conclude the conciliation process within 21 days, the dispute is then referred by the Minister to an industrial tribunal formed of three judges delegated by the Judicial Council for this purpose. The industrial tribunal must treat the dispute as an expedited matter, therefore examining it within seven days of the date of referral and issuing a decision in its regard within 30 days. The decision of the industrial tribunal is deemed as a final decision not open to appeal before any judicial or administrative body.
The settlement reached as a result of the conciliation proceedings, as well as the decision issued by the industrial tribunal, are considered to be binding on both employers and employees and any violation thereof results in penalties in the form of fines.
An employer is prohibited from making any changes in the terms of employment during the time when a dispute is pending before the conciliation officer, conciliation board or industrial tribunal. During this process, the termination of any employee is also prohibited except with the written permission of the conciliation officer, conciliation board or industrial tribunal, as the case may be.
Representation in Court
In the case of claims before the Magistrate Courts, disputants must be represented by attorneys, except where the amount of the claim is below JOD1,000.
For claims before the Remuneration Authority, the parties may appear before the Authority by themselves or be represented by any other person.
Parties may not be represented by attorneys before the conciliation officer or the conciliation board, while they can choose to appoint one or more attorneys to appear on their behalf before the industrial tribunal.
In accordance with the Jordanian Arbitration Law, arbitration clauses that are included in employment contracts prior to the occurrence of a dispute are considered as null and void.
Courts have the power to order a losing party to pay attorneys' fees. However, the fees that are reimbursed pursuant to court orders are not the actual attorneys' fees incurred by the prevailing party, as the amount of such award is subject to a maximum limit prescribed by the Law of the Jordanian Bar Association. The current cap in accordance with this law is JOD1,000.