All about Emiratisation New Rule for Smaller Businesses

The Ministry of Human Resource and Emiratisation (MoHRE) announced a new Emiratisation bracket on 11 July 2023, these rules aim to increase the employment of Emirati citizens in the private sector, particularly focusing on smaller businesses with a workforce of 20-49 employees.

The sector that is required by MoHRE to account for the new regulation includes; Financial, insurance activities, real estate, information and communication, healthcare and social work, construction, transportation and warehousing, hospitality and residence services, wholesale and retail, administrative and support services, professional and technical activities, arts and entertainment, mining and quarrying, and Transformative industries.

What does that mean for employers?

Private companies with 20-49 employees that now included in the Emiratisation initiative and are required to meet specific Emiratisation targets. Each business employing in the range is expected to hire at least one Emirati by the end of 2024 with one additional Emirati hire every year.

It is strongly believed that the companies within this Emiratisation are actively seeking to meet the hiring quota as soon as possible. To achieve this, it is recommended that companies that are yet to apply, register and then engage with the UAE government partnership program “Nafis” or other similar recruitment agencies. The UAE government has created the Nafis platform, which can specifically aid companies with recruitment and discovering Emiratis candidates for hiring and achieving their Emiratisation quotas. For companies that fail to comply with hiring one Emirati into a skilled role before getting the required deadline. It will help the company to reach new heights easily.

What are the penalties for failure to comply?

Companies that fail to comply with hiring one Emirati into a skilled role before the required deadline, risk incurring penalties and fines as well. If the company consisting of 20-49 employees fails to hire one Emirati in 2024, then they are liable to pay an AED96,000 penalty fine. This fine will further increase to AED 108,000 the company will have to pay if they fail to employ two Emirati in the year 2025. Companies are planning to provide employment to Emirati so that they won’t have to pay penalty.

Previously it was only with the private companies with 50 or more employees must maintain specified Emiratisation rates. The companies were expected for achieving the rate of 2% Emiratisation by the end of 2022, with a further 2% through 2023, to reaching 4% total. In increasing 2% year every year, by the end of 2026, companies are expected to achieve a minimum of 10% of UAE operating in skilled positions though. 

Read more about the Emiratisation Rule for more than 50 employees

The Emiratisation initiative by UAE government is to boost the number of UAE citizens employed in the private sector and the requirements differ depending on the size of the company,

For any advice or guidance in respect of Emiratisation, please contact NR Doshi as we have supported a lot many businesses in finding talented as well as trustworthy resources