Ask the law: Can I get a full housing fee refund if I am overcharged in Dubai?

Question: I live in a rented villa in Dubai, which I will be vacating soon. I have been paying a very high housing fee for the last three years. When I brought it to the attention of the concerned authority, they confirmed and agreed to refund the difference in fees for the last six months. However, I find this unacceptable. They had the updated tenancy contract. They claim that the systems are all interlinked, so logically, this should apply to housing fees as well. I have been overcharged a sum of Dh3,200, so I am entitled to get a refund of the full amount? What is the logic in refunding the difference in fees only for the last six months?

Answer: Housing fees are levied on all residential units and are collected by Dubai Electricity and Water Authority (Dewa) on behalf of Dubai Municipality. The housing fee is a service fee calculated at five per cent of the rental value for non-Emiratis in exchange for services provided by Dubai Municipality.

In one article titled ‘The housing fee is not strange’, the director general of Dubai Municipality mentioned: “The housing fee is neither a strange nor a new fee, as this fee is imposed according to the Dubai Municipality Revenue Law of 1962 and not 1968, and this is to correct the information only.”

He continued: “The housing fee that is collected from the occupants of real estate [units] in the emirate of Dubai, including real estate located in freehold areas, is estimated at five per cent of the annual rental value of the real estate unit. This was previously collected in one payment from companies for housing their employees and workers through the Department of Economic Development upon licensing those companies, and through Dubai Municipality for individual housing units, until in recent years the electricity and water consumption bill was developed and paid in monthly instalments.”

It was also mentioned in another article that, “As per the directives of the Government of Dubai, housing fee is charged at five per cent of the annual rent (for tenants) and 0.5 per cent of the property purchase price (for expatriate owners residing in their own properties). The value is then divided into 12 monthly payments.”

If the questioner believes that the calculation is wrong, then she or he needs to provide a letter to Dewa, which will then be updated in the municipality’s system and checked. Copies of the rent contract and the title deed must also be provided. Whatever extra is paid will be credited to his/her account if one is overcharged. In case the calculation is right, the person will continue to pay the same amount on a monthly basis.

According to Dewa, it is Dubai Municipality, and not Dewa, who is responsible for this amount to be updated and any extra amount ought to be either adjusted with the monthly Dewa bill or it can even be refunded to the applicant if he or she applies on the Dewa website for a refund through the ‘Request for Refund’ service and chooses the amount to be refunded through:

• Refund through Western Union, for a fee of Dh18.37 or 1 per cent of the total refund amount (whichever is higher)

• Refund through IBAN, at no fee

• Refund through cheques, for a fee of Dh2

Question 2: Under what circumstances does the UAE Labour Law allow the employer to deduct an employee’s salary?

UAE Federal Law No 8 of 1980, Article No 60 says the following:

“No amount of money may be deducted from a worker’s remuneration in respect of private claims, except in the following cases:

A) The recovery of advances or amounts of money paid to the worker in excess of his entitlements, on condition that the amount deducted in that case does not exceed 10 per cent of his periodic remuneration.

B) Contributions that the worker is required by law to make from his remuneration, e.g. towards social security and insurance schemes.

C) The worker’s contributions towards savings fund or repayment of advances repayable thereto.

D) Contributions towards any welfare scheme or in respect of any other privileges or services provided by the employer and approved by the Labour Department.

E) Fines imposed upon the worker for any offence he has committed.

F) Any debt payable in execution of the judgement of a court of law.