A guide to benefits for Emiratis in private sector jobs and fines for non-compliance

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Recent government announcements regarding social support for Emiratis and punitive measures against the private sector when it fails to hire UAE nationals indicate authorities want companies to step up their efforts, experts say.

The moves illustrate the government’s determination to encourage citizens to join the private sector and persuade businesses to onboard Emiratis, they said. The National.

In September 2021, the Nafis The initiative has set a goal of recruiting 75,000 Emiratis into the private sector within five years.

When a country offers you opportunities, it has the right to ask companies to do so.

Raka Roy, Partner at Galadari Advocates & Legal Consultants

This month, the UAE Cabinet decreed that companies with more than 50 employees should have 2% Emirati workforce by next year, rising to 10% by 2026.

A company that does not reach the target must pay 6,000 Dh per month for each Emirati that it does not hire.

“The government wants to make it clear that it is serious about emiratization,” said Raka Roy, partner at Galadari Advocates & Legal Consultants.

“Punitive measures are not something we saw earlier.

“The figures on emiratization may not be encouraging enough, so making it mandatory and accompanying it with a fine will ensure implementation.”

The penalty will work

The legal and banking sectors and large family businesses have the highest rates of emirateization in the private sector, said Hamza Zaouali, founder of Iris Executives, which specializes in placing UAE nationals. He said fines would ensure compliance.

“Being the oldest Emirati hunting company, we have witnessed first-hand the reluctance and anxiety of most of the private sector to hire Emiratis,” Mr Zaouali said.

“With these new incentives, the private sector and the Emirati workforce will finally have to learn to work together in a sustainable way.

“As an employer myself, I can tell you that such a sanction will work.”

Two percent of the Emirati workforce

The program is implemented through Nafis, a federal program that prioritizes the integration of Emiratis into the private sector.

One of the highlights is the target of 2% Emirati employees for private companies by next year.

“What they are saying is that for every 50 employees there should be one Emirati employee and if this structure is not reached by January 2023 there will be a fine of Dh6,000,” said Miss Roy.

“If you have 100 employees, the mandatory requirement is at least two Emiratis or you will pay Dh12,000 in monthly fines. These companies will incur fines of Dh144,000 over the year.

The Ministry of Human Resources and Emiratization said the Dh6,000 fine would be increased by Dh1,000 each year until 2026.

Ms Roy said there was a link between the levy and the announced support for young Emiratis.

“This money will empower unemployed Emiratis,” she said. “Thinking is well connected. If you can’t give an Emirati a job, you have to pay a fine. It is about the same amount as the monthly support of a young Emirati graduate or a person in training.

Support for graduates

Salary support was announced last year for recent Emirati university graduates and those in training.

This includes a monthly stipend of Dh5,000 for up to five years for Emirati university graduates.

There is also a one-year salary support of up to Dh8,000 per month for qualified Emiratis in training.

Does the policy apply in free zones?

Free zones are economic zones with preferential tax and customs rates. Until now, free zone companies were exempt from the obligation to hire Emiratis.

Lawyers said clarification was awaited on whether the new policies would apply nationwide.

“I hope companies from various free zones will also be included in this new incentive, so as not to create loopholes for companies to avoid the change,” Zaouali said.

Salary supplement in specialized fields

Fixed monthly salary support for Emiratis working as nurses, accountants, auditors and software programmers, among other professions, will be offered.

“This is a step forward in encouraging UAE citizens to apply for jobs in specialized private sector fields such as software, nursing and accounting,” said Eslam Oraif, Advisor Legal from Galadari Law Firm.

“The government is asking citizens of the UAE to come forward and apply for these jobs and if they are hired, the government will provide an incentive to supplement their salary.

“These private sector jobs are populated by non-Emiratis,” he said.

UAE government support programs will empower and protect Emirati employees in the private sector.  Victor Besa / The National

Dismissals in the Emirates

Layoffs are more common in the private sector and the government aims to protect Emiratis.

The latest mandatory social support program will provide security for Emiratis and residents in the private and public sectors, so that employees who lose their jobs will receive a cash payment each month for a specified period.

Under the Nafis scheme, Emiratis receive financial support for up to six months to seek employment in the event of “involuntary loss of employment in the private sector”.

Mr Oraif said any laid-off private sector Emirati employee would receive unemployment benefit.

He said a provision of the UAE Law 212 of 2018 states that the aid would be less if the employee was terminated due to negligence.

“There is a difference in supporting an Emirati who has been arbitrarily fired due to an economic situation versus someone who has lost their job due to negligence,” Ms. Roy, of Galadari Advocates.

“The first case is genuine and the second will not benefit as much. It is important for people to know that the logic is applied and that you must qualify for support. »

Family allowances

There is an allowance of 800 Dh for a child which goes up to a maximum of 3,200 Dh per month for the family.

“It’s similar to the social security laws of many European countries – that’s what the government is trying to do here,” Ms Roy said.

“This matches the child support packages given to families in mature economies.”

Retirement funds and incentives

The government will bear the pension fund contribution of UAE employees in the private sector for five years and will bear the bulk of the employer’s contribution to an Emirati’s pension fund for the first five years.

Details are awaited on retirement benefits.

The goal is to create more than 12,000 jobs per year for UAE citizens across all economic sectors.

Private companies that recruit and train Emiratis are entitled to an 80% discount on the fees charged by the Ministry of Human Resources and Emiratization for its services.

Correct an imbalance

With expats far outnumbering UAE nationals, Ms Roy said it was time to balance the field.

“When a country gives you opportunities, they have the right to ask companies for that,” she said.

“The United Arab Emirates opens its arms to all nationalities who take this country as their second home. It is a unique nation where more than 80% of the population is expatriate, so unless the government adopts such programs, there will definitely be an imbalance.

“Each country will look at improving its own nationals.”

Mr Zaouali also said the measures were essential.

“The new program is both more aggressive towards Emiratization in the private sector and more favorable to private companies – offering additional pay and additional benefits to their Emirati employees – which is a big step forward in making companies private as attractive as government sectors,” he said. mentioned.

Updated: May 20, 2022, 4:30 a.m.

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