UAE Emiratization Law Impacts the Private Sector
There are new rules for private sector employers in the UAE due to the new UAE Emiratization Law. To enhance Emirati employment in specific roles, the UAE cabinet announced that private sector companies with at least 50 skilled employees must ensure 3% of their workforce is made up of Emiratis beginning July 1, 2023, and going up to a 4% target by the end of 2023. This is one part of the government’s Emiratization initiative.
With many skilled workers and employees arriving in the UAE, the government is choosing to regulate private-sector employment quotas to support UAE citizens who want to work.
These new rules aim to raise Emiratization rates to 10% by the end of 2026. Therefore, the Emirati employment rate is to increase to 6% in 2024, 8% in 2025 and 10% in 2026.
Around 79,000 UAE nationals are working in the private sector as of the end of July.
These numbers reflect the highest-ever rate of Emiratization recorded in the UAE private sector, marking at the same time a 57% increase compared to the end of 2022 figures, where 50,228 UAE nationals were employed in the private sector,
The Government’s objective is to empower Emiratis to thrive in the private sector, enhance their competitiveness, and enable them to actively participate in the economic and overall development of the country, where the private sector plays a critical and driving role.
Fines for entities for not meeting these deadlines increase by Dh1,000 per month per Emirati not hired. The penalty this year is Dh7,000. This will increase to Dh8,000 in 2024, Dh9,000 in 2025, and Dh10,000 in 2026.
This information was provided by Nexus, Asinta’s employee benefits consulting Partner in the UAE. If you need assistance with your employee benefits in the UAE, please contact Asinta, and we will put you in touch with Nexus’ local experts.