Praise be to Allah, and peace and blessings be upon our master, the Messenger of Allah.
The established fundamental principle in Shariah is that a contract is the binding law between the contracting parties. It is obligatory for all involved parties to respect the terms and clauses agreed upon in the contract. This is in accordance with the statement of Allah the Almighty {which means}: "O you who have believed, fulfill [all] contracts." [Al-Ma'idah/ 1]. This is in addition to the statement of the Prophet (peace and blessings be upon him): "Muslims must abide by their conditions." [Narrated as a definitive hanging hadith by Al-Bukhari in his Sahih]
Accordingly, an employee who claims the compensation mandated by labor law in the event of an arbitrary or wrongful dismissal isn`t considered sinful. Labor laws were established specifically to protect the mutual interests of both the employee and the employer. It is a well-known legal maxim in Islamic jurisprudence that "The state's governance over the citizens must be guided by public interest." Therefore, this regulatory law is endorsed by Shariah and functions as a form of "General Custom" (Al-'Urf al-'Aam).
Another established jurisprudential maxim states that "What is acceptable by custom is treated as if it were a stipulated condition." Consequently, the provisions of the country's labor law are automatically implied and integrated into all employment contracts within the state.
Therefore, whatever financial compensation the judge rules in favor of the employee—excluding legal/statutory interest—based on the law and without any resort to lying or forgery, is entirely permissible for the employee to accept and benefit from.
In conclusion, there is no religious objection to an employee claiming the rights guaranteed to them by labor law, as it carries the weight of an Islamically valid General Custom. The employee is entitled to take the compensation awarded by the judge—excluding any legal interest—provided that the claim was free from deception or falsification.
Nevertheless, practicing the Islamic principle of extreme scrupulousness and God-consciousness (Al-Wara') is always highly commendable: if the employee feels that the awarded compensation significantly exceeds the actual harm or loss they suffered, it is better to take what justly covers the damage and leave the rest. And Allah Almighty knows best.
