Owner/Operator Model: Whose Employees Are They Anyway?

It is common in the UAE for hotels to utilise a separate owner operator model. The model works well when the interests of each separate party are broadly aligned. However, where the parties fall into dispute, a number of difficulties can arise. In this article we consider the potential employment issues in circumstances where an owner operator relationship breaks down.

Legal Framework – owner/operator model

In order to regulate the interests and obligations of a hotel owner and operator, a hotel management agreement ("HMA") is signed by each of the parties. A well drafted HMA contractually regulates the relationship between the parties. However, in relation to employees, there are certain issues which cannot be entirely resolved with a HMA.