In the UAE, private sector companies with more than 20 Employees must comply with Emiratisation quotas, not just to meet numbers but also to avoid a cascade of consequences. Strict regulations are in place, and failure to hire Emirati nationals in skilled roles can lead to hefty fines and a series of punitive actions by the Ministry of Human Resources and Emiratisation (MoHRE).
Key Aspects
Financial Penalties: Non-compliant companies face significant financial penalties. MoHRE imposes fines of AED 72,000 for each Emirati not appointed in skilled roles, payable in a single installment.
Escalating Consequences: The MoHRE outlines a series of actions for non-compliant establishments. These include e-follow-ups, subsequent notices, and reminders to recruit citizens and pay assessed contributions, and even suspension of work permits.
Operational Disruptions: Suspension of work permits hampers the company’s ability to operate smoothly, disrupting workforce management and productivity. This can impact day-to-day operations and may lead to delays in or cancellation of projects and services.
Reputational Damage: Non-compliance reflects poorly on corporate governance and commitment to national development goals. It can tarnish the company’s reputation, potentially deterring clients, investors, and partners.
Key Takeaway:
Non-payment of Emiratisation fines initiates a chain of events that can affect the company financially, disrupt operations, and damage its reputation. It underscores the critical importance of compliance with Emiratisation quotas for companies operating in the UAE.
