The UAE has expanded its Emiratisation requirements to include private sector companies with fewer than 50 employees.
Previously, only companies with 50 or more employees were required to hire UAE citizens to meet the target set by the UAE government.
The new update requires even private establishments with 20 to 49 employees to hire at least one UAE national in 2024 and another in 2025.
The new rules set by the Ministry of Human Resources and Emiratization (MoHRE) will come into effect in January 2024.
Let’s find out why the UAE government is taking such initiatives and the importance of Emiratisation.
Expanding Emiratisation to small private-sector firms
Emiratisation is a government effort in the United Arab Emirates (UAE) to increase the number of Emiratis working in the country.
(Emiratis are individuals that are born in, hold citizenship of, or reside in the UAE.)
According to the latest update, companies with fewer than 50 employees are now included under the Emiratisation Law if they operate in certain specific economic sectors.
These sectors include,
- Professional and technical activities
- Administrative and support services
- Arts and Entertainment
- Mining and quarrying
- Transformative industries
- Wholesale and retail
- Transportation and warehousing
- Hospitality and residency services
- Information and communications
- Financial and insurance activities
- Real estate
- Education
- Healthcare and social work
- Construction
This decision will be implemented alongside existing policies that target establishments with 50 or more employees. This requires a 1% increase in the number of Emiratis working in skilled positions every six months.
Enterprises that do not adhere to the new Emiratisation regulations will be required to make annual financial contributions.
Those failing to hire an Emirati citizen as mandated will be subject to a fine of AED 96,000 in 2024. The penalty increases to AED 108,000 for the subsequent year, 2025.
The idea of Emiratisation began in the early 1970s when the UAE government realized that they were relying too much on foreign workers.
They introduced different policies to encourage Emiratis to work in private companies, like setting quotas, providing training and scholarships, and giving tax breaks.
The UAE Cabinet first announced on 25th February 2022, that private companies with 50 or more employees must maintain a minimum of 2% Emirati employees.
The law also includes several exemptions from the Emiratisation requirements. These exemptions encompass companies situated in free zones, companies engaged in specific activities, and companies facing challenges in finding suitably qualified Emirati employees.
In 2000, only 15% of workers in the UAE were Emiratis, but by 2020, it had risen to 25%.
According to the Ministry of Human Resources and Emiratisation (MoHRE), approximately 79,000 Emiratis are currently employed in the private sector.
However, the government wants to reach a target of 50% Emiratisation by 2025.
UAE Government’s initiative to boost Emiratisation
Dr. Abdulrahman Al Awar, Minister of Human Resources and Emiratisation, told the media that expanding Emiratisation targets will attract Emirati citizens to work in these establishments.
This will support Emiratisation efforts and enhance the private sector’s role in the national initiative.
He acknowledged the remarkable achievements of this initiative under the guidance of His Highness Sheikh Mansour bin Zayed Al Nahyan, the Vice President and Deputy Prime Minister of the United Arab Emirates.
Dr. Abdulrahman also believes that expanding the Emiratisation targets will yield positive results and bring benefits to both Emirati citizens and the establishments themselves.
The Nafis program will provide support to those private sector establishments that excel in hiring UAE nationals.
Conclusion…
The Ministry will communicate with the eligible organizations through its digital channels, considering diverse factors such as job categories, work environment, geographical location, and growth potential in specific economic sectors.
Moreover, it will play a vital role in fostering a workforce that is diverse and inclusive in the UAE.
Will this impact expats finding opportunities in the UAE? Not really.
The Emirati population is still a very small percentage of the workforce and initiatives like this is only fair to promote equal opportunity and reward skilled Emiratis, promote social stability, and strengthen national identity.
