Important FAQs for Emiratization rules in the UAE

What is Emiratization?

The UAE authorities have started an initiative called Emiratization. As per this initiative, it is mandatory for employers in the public and private sectors to recruit UAE nationals. The main objective of Emiratization is to increase local contribution to UAE’s economy through the active hiring of UAE nationals.

Although the public sector in the UAE has made huge strides in this department (hiring more Emiratis) the private sector is yet to catch up. Hence, the UAE authorities implemented a cabinet decision that makes it compulsory for companies to hire UAE nationals in the private sector.

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What is Nafis?

It is important to understand what Nafis is, and Sheikh Abdullah Bin Zayed Al Nahyan (Minister of Foreign Affairs and International Cooperation and Chairman of the Education and Human Resources Council) shed some light on this matter during the council’s virtual meeting.

Sheikh Abdullah said that Nafis (an Arabic word for complete) is a crucial step to increase Emirati participation in the UAE’s private sector. The UAE’s private sector plays a pivotal role in the nation’s development by contributing a sizable chunk of economic revenue. Over time, the increased employment of UAE nationals in the private sector will create a new generation of talented professionals full of diversity, flexibility, and competitiveness.

The UAE announced the Projects of the 50, which is a series of developmental and economic projects to expedite the country’s progress in multiple sectors. At the same time, Projects of the 50 also aims to transform the UAE into a hub that entices global investors and entrepreneurs. Nafis is one of these projects.

Nafis aims to create a new generation of talented, experienced, and knowledgeable professionals and increase the competitiveness of the UAE’s private sector. With Nafis, more UAE nationals can enter the private sector and acquire valuable skills. The various programs under Nafis are as below:

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What are the Rules Governing Emiratization in the UAE?

The rules governing Emiratization are Ministerial Decision No. 279 of 2022, Cabinet Decision No. 18 of 2022, and other rules defining benefits under the Nafis scheme.

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What are the Requirements under the Nafis Scheme?

According to the Emiratization laws, every private company in the UAE with over 50 employees must increase its Emiratization rate by 2% (applies to skilled workers). These laws are effective from 1st January 2023. The Emiratization target depends on the company size. The details are as follows:

• 50 skilled workers – a minimum of 1 Emirati.
• 51 – 100 skilled workers – at least 2 Emiratis employees.
• 101 – 150 skilled workers – a minimum of 2 Emirati employees.
• 151+ workers – 1 Emirati employee for every 50 workers.

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Does the Emiratization law apply to all jurisdictions in the UAE?

The Emiratization law applies to registered private sector companies registered in mainland UAE. Free zone companies, including those in ADGM and DIFC (Dubai International Financial Centre), will not be subject to Emiratization laws. However, free zone entities can hire UAE nationals if they are appropriate for specific job profiles.

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How does the law define skilled workers?

As per MoHRE (Ministry of Human Resources and Emiratization), a skilled worker is an individual that fulfills the criteria below:

• Must possess a certificate higher than or equivalent to secondary education.
• The candidate must have a worker’s certificate attested by a competent authority.
• The skilled worker’s salary should not be less than AED 4,000 per month.
• Lastly, the skilled worker must be from any of the below sectors:
• Legislators, business executives, and managers.
• Writing professionals
• Professionals in technical, scientific, and human services.
• Service and sales occupations.

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What are the penalties for non-compliance with Emiratization law?

After the implementation of the Emiratization law (post January 1, 2023), companies will face penalties for non-compliance. The offenses are penalties are as follows:

• An AED 6,000 penalty (for each Emirati) applies to firms that do not employ the required number of UAE nationals.
• A minimum fine of AED 20,000 and a maximum of AED 100,000 apply under the following circumstances:
• After obtaining the work permit, the company does not hire an Emirati but continues to receive support from Nafis.
• Emiratis getting jobs under the Emiratization scheme must fulfill their duties and responsibilities (as per the company’s standards). If these employees do not perform well, the company should inform Nafis. Failure to inform Nafis about non-performance/shoddy work may result in penalties.
• Individuals benefiting from the Emiratization program must report to work. If the company fails to inform Nafis about the employees not reporting to work, it can result in hefty fines.
• Companies terminating an employee’s benefits without providing a valid reason/justification and not informing Nafis about the same will face legal action and penalties.
• Companies failing to hire an Emirati post-training without a valid reason will face penalties.

If a company fails to pay the fine (imposed by the relevant authorities), it may lead to the suspension/termination of its business license. The errant company may not be allowed to conduct operations within the UAE. Additionally, the fines and legal proceedings may also impair the company’s ability to apply for additional employee visas.

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How are companies classified under the Emiratization rule?

UAE’s MoHRE (Ministry of Human Resources and Emiratization) along with the Federal government have introduced the new Cabinet Resolution No. 18 of 2022. This act classifies companies into three categories.

Category 1

The first category covers organizations that fall under the purview of laws & decisions regulating the labor market. At the same time, these companies must also fulfill the necessary general obligations. Additionally, the companies must also meet the criteria below.

• These companies must raise their Emiratization rate at least thrice that of the target.
• Adhere to the Nafis program and train a minimum of 500 Emiratis every year.
• The company’s owner must be a young citizen under the approved standards or:
• The business must be one of the employment centers that support the implementation of the Workforce Planning Policy through the promotion of cultural diversity in the UAE.

Category 2

The second category includes companies that meet the criteria below:

• Adhere to the general standards, laws, and regulations in the UAE.
• Follow the UAE’s policy related to the promotion of cultural and demographic diversity.
• Operate within the targeted sectors and activities determined by the Council of Ministers (based on MoHRE’s proposal).

The companies that do not meet these criteria but abide by the UAE’s policy to promote cultural and demographic diversity will fall under the second category.

Category 3

Companies not complying with Labor Law and related regulations will fall under the third category. These categories are crucial because they determine the work permit fees (payable to MoHRE). MoHRE charges an AED 150 fee to issue/renew a labor permit.

The work permit application fees will range between AED 250 to AED 1,000 for companies that fall under the second category. On the other hand, the application fees will be AED 2,500 for companies that fall under the third category.

Keeping the above factors in mind, companies must modify their hiring policies and working patterns to comply with the Emiratization rate and the classification system. In this way, they can avoid hefty penalties or downgrading their category status.

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Who benefits from Nafis?

People who benefit from Nafis are job seekers and individuals currently employed in the private and public sectors (including free zones) in the UAE. These individuals include males and females aged 18 and above. Although Nafis aims to attract talent in the banking, finance, and insurance sector, it also encourages the private sector to employ more UAE nationals.

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Is Nafis for selected industries only? Which industries are not covered under Nafis?

The Nafis initiative applies to all industries in the private sector.

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Will the authorities add more sectors and specialties to the Nafis program in the future?

Refer to the latest posts related to Nafis on social media platforms and follow the Nafis platform for more details.

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Has the Nafis program been initiated yet? If not, when will it be launched? How can I access it?

The UAE authorities launched Nafis in September 2021. Moreover, the registration process has started through multiple phases. Visit the Nafis initiative page for more information.

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When was the second package of Nafis initiatives and programs launched?

The UAE authorities launched the first package of the Nafis initiatives in October 2021 which included the Emirati Salary Support Scheme, the Unemployment Benefit, the Job Offers Program, Child Allowance Scheme, and the Pension Program. Introduced in March 2022, the second phase of the Nafis has four specialized training and development programs.

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What does the second package of the Nafis program include?

The second package of the Nafis program includes the following:

• Talent Program – The main aim of the talent program is to develop the capabilities of national cadres. These cadres will in turn train Emiratis, help them develop specialized skills, and obtain international professional certificates.

• National Healthcare Program – The National Healthcare Program aims to enhance the capabilities of Emiratis in the nursing sector through the following schemes

• Paid scholarships

• Health Assistant Program for high school graduates

• Diploma/higher diploma in emergency medicine

• Bachelor’s program for nursing

With the above schemes, the UAE authorities aim to qualify and empower 10,000 UAE nationals in the health sector for the next five years.

• Apprentice Program – The apprentice program includes a 1-year training program followed by employment in private/semi-government entities to foster the development of Emirati graduates (learning and skill training) in several sectors.

• Career Counselling – Career counseling provides valuable career guidance and counseling services to Emirati students that will help them discover their skills, identify opportunities, and choose the appropriate career paths. Moreover, the program will also assist students with guidance to write impressive resumes, teach them to excel in interviews, and educate them about work ethics.

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Who will implement the training programs?

• The Abu Dhabi Global Market (ADGM) Academy and the Center for Excellence for Applied Research and Training (CERT) will implement the talent program. Both the above bodies are partners in the Nafis program, with CERT being the commercial, R&D arm of the Higher Colleges of Technology.
• The Fatima College of Health Services, which is affiliated with the Abu Dhabi Center for Technical and Vocational Education and Training (ACTVET), will implement the Nursing Cadres Development Program.
• Private and semi-private companies (that fulfill the criteria) will supervise and implement the Apprenticeship Program.
• The Federal Youth Foundation will implement the Career Counselling Program.
• Note that the Emirati Cadres Competitiveness Council will supervise and oversee the activities as the above-mentioned entities implement all the programs.

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Who is entitled to register for these programs and how?

UAE nationals between the ages of 18-60 can register on the Nafis platform. Whether it is searching for work, finding training opportunities, or applying for any of the programs, the application can register on the Nafis platform through their UAE pass. Depending on the terms of the program and their eligibility, the applications will receive their confirmation.

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How can you introduce these training programs into your organization? What are the benefits of the Nafis program?

After the UAE authorities launched the Nafis program, they spread the news through various media houses and launched the Nafis electronic platform. The electronic platform has all the necessary information and answers to questions that people may have regarding the program.

Apart from launching electronic platforms and spreading the word, the UAE authorities have formed strong partnerships with universities, bodies, and the authorities concerned with helping Emiratis. These partners can contribute to the effort through the following actions:

• Extend their cooperation by introducing Emiratis to the advantages and initiatives of Nafis.
• Encourage citizens to register on the online Nafis platform.

The UAE authorities believe that efforts like the ones above will yield fruitful results in the future. What are the potential benefits of such efforts? In the long run, these efforts will develop individual skill sets and make them invaluable assets in the private sector workforce.

The UAE is witnessing a tremendous period of economic growth and prosperity. Thanks to Nafis and similar initiatives, UAE nationals will have more opportunities to be part of the UAE’s glorious future.