On the 11th of July 2023, the Ministry of Human Resources and Emiratisation (MoHRE) announced a new Emiratisation framework, expanding its scope and setting new guidelines for companies with 20-49 employees. By the end of next year (2024), these companies must hire at least one Emirati employee, and each subsequent year, they are required to add another Emirati employee in a skilled position.
The MoHRE had previously issued Ministerial Decision 279 of 2022 on 6th June 2022, which introduced measures to increase the number of Emiratis employed in the private sector. Companies with over 50 employees were obligated to maintain specified Emiratisation rates, calculated as a percentage of their skilled workforce.
To achieve the Emiratization targets, companies were expected to reach a 2% Emiratisation rate by the end of 2022, followed by an additional 2% in 2023, totaling 4% overall. The rate was set to increase by 2% each year, with a minimum target of 10% Emiratisation in skilled positions by the end of 2026. These measures were implemented to enhance Emirati participation in both the public and private sectors and create better employment opportunities for UAE citizens.
Read: Emiratization in the UAE explained
As of 1st July 2023 (later extended to 7th July due to holidays), companies were required to meet a mid-year target of 1% Emiratisation. This deadline aimed to ensure companies were on track with their hiring and compliance with Emiratisation requirements.
The fourteen sectors affected by the new regulations include Financial and insurance activities, Real estate, Information and communications, Education, Healthcare and social work, Construction, Transportation and warehousing, Hospitality and residency services, Wholesale and retail, Administrative and support services, Professional and technical activities, Arts and entertainment, Mining and quarrying, and Transformative industries.
What happens next to the companies that are yet to apply
For companies falling within the 20-49 employee range, it is crucial to promptly fulfill the Emiratisation quota. To do so, they are strongly advised to register and engage with the UAE government’s partnership program called ‘Nafis’ or utilize other similar recruitment agencies. The ‘Nafis’ platform is designed specifically to assist companies in recruiting and discovering suitable Emirati candidates, thereby helping them meet their Emiratisation targets.
Failing to comply with the hiring requirements by the specified deadlines will result in penalties and fines for these companies. If a company with 20-49 employees fails to hire an Emirati in a skilled role by 2024, they will be subject to a penalty fine of AED 96,000. This fine will increase to AED 108,000 if they fail to employ an Emirati in 2025. Therefore, it is essential for companies to act promptly and responsibly to meet the Emiratization obligations set forth by the UAE government.
James Swallow is the Commercial Director, PRO Partner Group
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