Emiratisation — the employment of Emiratis — is among the top priorities for the UAE government. Earlier this year, the UAE Cabinet announced a comprehensive plan to boost Emiratisation in the private sector.
Companies are mandatorily required to increase the number of UAE citizens in their workforce, which would help create about 75,000 jobs by 2026. Firms that go above and beyond the target stand to get several incentives, including 80 per cent discounts on service fees of the Ministry of Human Resources and Emiratisation.
Starting January 1, 2023, non-compliant companies will have to pay thousands of dirhams in fines for every Emirati who has not been hired.
Here is all you need to know:
What is the latest Emiratisation target?
Companies in the UAE with 50 or more employees are mandated to annually raise their Emiratisation rate by 2 per cent of overall skilled jobs. By the end of this year, 2 per cent of a company’s skilled staff must be Emiratis. This must increase by 2 per cent every year, to reach 10 per cent by 2026.
What are the financial penalties for failing to meet the target?
From January 2023, a monthly fine of Dh6,000 will be levied for every Emirati who has not been hired. This works out to Dh72,000 annually. The fine will be increased by Dh1,000 on an annual basis.
Suppose a company has 100 employees, it would need to have at least two Emiratis on the workforce by the end of this year. If it fails to hire two Emiratis by then, the monthly fine would be Dh12,000 (Dh6,000 per Emirati not hired). If this continues for the whole year, the overall annual fine would be Dh144,000 (Dh72,000 per Emirati not hired).
How is the fine paid?
According to details announced earlier, the total value of the fine is paid annually and in one instalment for that year. The information posted on the official UAE government website says that the amount should be paid through the digital systems of the MoHRE.
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Warning against fake Emiratisation
If an establishment carries out fake Emiratisation to get benefits from the Nafis programme, a fine of between Dh20,000 and Dh100,000 is imposed for each bogus Emirati employee. The same penalty applies to companies that submit incorrect documents or data to obtain benefits.
An administrative fine of Dh20,000 shall be applied for each Emirati employee if the beneficiary did not join work after a permit was issued and the company failed to report it. The same penalty applies if the establishment fails to report to Nafis that a beneficiary has stopped working.