TME LEGAL | DUBAI – RECHT KLAR

2023 Emiratisation Deadline for Private Companies

2023 Emiratisation Deadline for Private Companies

The Ministry of Human Resources and Emiratisation (MoHRE) has set the deadline for emiratisation in private companies to fall on June 30th.


TARGET AND DEADLINES


The Ministry of Human Resources and Emiratisation (MoHRE) has set a 2% Emiratisation requirement for private companies with 50 or more employees, since 2022. This requirement increases by 1% every six months, and the MoHRE has just announced that the deadline for companies to meet the half-yearly rate is June 30th, which means that companies must have a total of 3% Emiratis in skilled roles by this deadline, and 4% by the end of 2023, to comply with the new regulations.

Number of Skilled Workers in Establishments Employing More Than 50 WorkersMinimum Employment Rate of UAE Nationals
0 to 50 skilled workers1 Citizen
51 to 100 skilled workers2 Citizens
101 to 150 skilled workers3 Citizens
More than 151 skilled workers 1 citizen for every 50 skilled workers or part whereof
SOURCE: MINISTERIAL RESOLUTION NO.(279) OF 2022



By increasing Emiratisation rates by 2% annually for 5 years, the UAE is aiming to reach an increase of 10% by the end of 2026. The annual target is divided in two for every 6 months, hence the June 30th deadline.


It is important to note that although companies registered in Free Zones are exempt, the Ministry is still encouraging them to employ citizens of the UAE.


FINES


As of July 2023, non-compliant companies will be fined for not meeting the required rate for both this year and the 2022 targets. The penalty is set at Dh42,000 for every Emirati not hired by the deadline, which is calculated at Dh7,000 per month for 2023. The fines will then increase by Dh1,000 each year, until 2026.


NAFIS PROGRAM


The Nafis program is a federal government initiative that was launched on September 13th, 2021, aiming to assist Emirati nationals in pursuing their professional careers in the private sector, while also helping companies achieve their Emiratization targets.


The program offers a monthly salary subsidy of up to Dh7,000 to Emiratis with a monthly income up to Dh30,000. Additionally, the program provides child allowance and pension contributions.


Aisha Belharfia, Acting Undersecretary for Emiratisation Affairs and Assistant Undersecretary for Labour Affairs, emphasized the importance of companies to reach the semi-annual Emiratisation targets, and is encouraging the private sector to benefit from the support provided by the Nafis program:


The private sector is an active partner in enhancing the attractiveness and competitiveness of the job market, in line with the vision to make the UAE a dynamic economic hub that is among the most sustainable and fastest growing in the world,” She said. “The success of Emiratisation efforts depends on the expansion of the vacancies open to Emiratis in the private sector and building a secure network that supports their career paths. The Ministry of Human Resources and Emiratisation supports exceptional companies that train and employ Emiratis in line with Nafis’ objectives.


Even though the working hours and wages offered in the public sector have usually been more appealing, it is now changing and the government is making efforts to increase the number of Emirati citizens in the private sector: “We look forward to the results of the new mechanism of achieving Emiratisation targets, which guarantees continuous employment of Emiratis year-round and maintains their retention in the private sector,” said Ms Belharfia.


RESULTS


On April 19th 2023, the Ministry announced that the implementation of initiatives such as Nafis Program had resulted in an 11% rise in the number of Emiratis employed in the private sector during the first three months of 2022.


According to the Ministry’s report, more than 50,000 Emiratis had been employed in private companies by the end of last year. Out of these, 28,700 Emiratis had been hired after the commencement of the Nafis programme in 2021.


The Ministry of Human Resources and Emiratisation stated that they anticipate an substantial increase in the hiring of Emiratis over the next two months, due to the upcoming deadline of June 30th, 2023.


According to recent data from the ministry, the top 5 sectors that hired the most Emiratis in the first quarter of 2023 are business services, commerce and repair services, construction, financial brokerage, and manufacturing.

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