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UAE: EMIRATISATION RATES INCREASED IN PRIVATE SECTOR

Chapter Fifty One: UAE Emiratisation rates increased in private sector

On Monday 9th May 2022, the UAE cabinet introduced measures to increase the rate of Emiratisation in the private sector to 2% annually.

In accordance with the new ruling, mainland registered private sector businesses with more than 50 employees will be required to increase their percentage of Emirati employees in high-skilled roles by a minimum of 2% annually. They must reach a goal of 10% Emirati nationals on their staff role by 2026.

In order to reach the desired rate of 10%, a quota system will be imposed on private sector employers, requiring them to recruit and retain a certain number of Emirati nationals as a percentage of their overall staff. These thresholds are as follows:

  • 2% for commercial entities (where the entity has more than 50 employees)
  • 4% for banks
  • 5% for insurance companies (where the entity has more than 50 employees)

The new rules will come into effect from January 2023 and any companies that fail to meet their employment quota will be liable for AED 6,000 for each Emirati that hasn’t been employed. Employers are therefore advised to ensure that they are compliant with the new Emiratisation rates by the end of December 2022 in order to avoid financial penalties.

The MOHRE has established a three-tier system which classifies companies according to their contribution to the Emiratisation programme.

Tier 1 – Applies to companies that exceed their Emiratisation target rate by 3% and cooperate with the NAFIS Training programme.
Tier 2 – Applies to companies that meet their Emiratisation target and are compliant with all UAE policies on cultural and demographic diversity.
Tier 3 – Applies to companies that fail to meet their Emiratisation target or show commitment to UAE policies on cultural and demographic diversity
It is important to find out which tier your business is currently in and how you can increase recruitment of Emirati nationals to mitigate any potential fines when the rules come into force.

The government is using the federal programme, NAFIS to help facilitate this goal and is encouraging all private sector businesses to register on the NAFIS platform to advertise job vacancies for Emiratis.

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