September 30, 2026
On 4 August 2026, HE Justice Roger Stewart KC handed down an important judgment in Petria v (1) Pacifico (2) Philibert [2025] DIFC CFI 109 concerning the DIFC Court’s power to decline jurisdiction under Article 14(C) of DIFC Courts Law No. (2) of 2025 (the “New Courts Law”). The underlying proceedings involved claims of unlawful discrimination and victimisation brought under the DIFC Employment Law No. (2) of 2019 by an employee who worked in the DIFC. The First Defendant sought to challenge the DIFC Court’s jurisdiction on the basis that a term in the relevant employment contracts which referred to the jurisdiction of the courts of the “UAE” and “Dubai” should be construed as referring exclusively to the jurisdiction of the ‘onshore’ courts. The Court dismissed the application. It considered for the first time the proper construction of Article 14(C)(1) of the New Courts Law and ruled at [58] that (as was the case under the previous Courts Law) the ordinary and natural meaning of general expressions such as “Courts of the UAE” will be to refer to all the Courts within the UAE (i.e. including the DIFC Courts).
The decision is also significant for the fact that “central” to the Judge’s conclusion was “the location of the Claimant’s employment and the relevant provisions of the DIFC Employment Law”. In particular, the Judge referred to the fact that Article 4(3) of the Employment Law contained “mandatory applicable provisions of law… which include the protections against discrimination and victimisation” and which “prevent the circumvention of the DIFC employment law by the simple expedient of employing a person subject to a different choice of law to that of the DIFC – perhaps a law with very different protections and standards to that applicable in the DIFC”. On that basis, even if the First Defendant had been able to establish that it was obliged to employ persons under the ‘onshore’ MOHRE regime and subject to Federal UAE law, that would not have had the effect of disapplying mandatory provisions of the DIFC Employment Law, in circumstances where the Claimant was based within and ordinarily worked from the DIFC.
Those advising on employment relationships within the UAE should therefore be conscious of the fact that provisions of the DIFC Employment Law might apply to the employment relationship, regardless of whether there is an express choice of the law of another jurisdiction, if the employee is based within or ordinarily works from the DIFC.
HE Justice Roger Stewart KC subsequently awarded the Claimant her costs of the application in a separate judgment dated 2 September 2026. The Judge was persuaded to depart from the “starting point” in Practice Direction No. 1 of 2025 that each party will bear their own costs in employment disputes. The basis for doing so was the nature of the First Defendant’s application; it had been one inviting the Court to decline jurisdiction in circumstances where the DIFC Courts (i) otherwise had exclusive jurisdiction over the dispute; and (ii) where the natural forum for the dispute in any event. Denying the Claimant her costs would restrict, rather than enhance, access to justice in an employment dispute, which was contrary to the express purpose of the Practice Direction.
Karl Anderson was instructed by Bushra Ahmed of Mishcon de Reya on behalf of the successful Claimant / Respondent. Both judgments can be found here:
