Is it possible for my employer to hold my...

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The practice of employers withholding the passports of its foreign employees is prohibited under Circular No. 267 of 2002 issued by the Ministry of Interior (MoI) - unless it is carried out by the judicial authorities in accordance with relevant provisions of the law.
However, if the employee consents to handing over the passport, then such possession of the employee's passport by the employer shall not be deemed unlawful, provided the employee's consent is obtained in writing and the employer agrees to return the passport at the employee's request.
In addition, considering that you are employed by a company based in the mainland of Dubai, the provisions of Federal Law No. (8) of 1980 regulating Employment Relations in the UAE (Employment Law) shall be applicable.
Therefore, in case your employer terminates your employment on the grounds of your demand to return your passport or your refusal to consent to the retention of your passport, such a termination of employment may be deemed an arbitrary termination.
This is in accordance with Article 122 of the Employment Law, which states: "A worker's service shall be deemed to be arbitrarily terminated by his employer if the reason for termination is irrelevant to the work. More particularly, a termination shall be regarded as arbitrary if it is prompted by a formal complaint filed by the worker with the competent authorities or a legal action instituted against the employer that proved to be valid."
In pursuance of the aforementioned circular and the provision of the Employment Law, it may be noted that you may demand the return of your passport from your employer.
If your employer refuses to return your passport, you may consider approaching the Ministry of Human Resources and Emiratisation. You may also file a complaint against your employer at a police station.

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