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UAE: Emiratisation target deadline extension announced; what has changed, when will fines apply?

Non-compliant companies will face a Dh42,000 fine for each Emirati not employed starting July 8

Published: Tue 13 Jun 2023, 10:43 AM

Updated: Tue 13 Jun 2023, 11:33 PM

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The deadline to meet semi-annual Emiratisation targets for private sector companies with 50 employees or more has been extended from June 30 to July 7. The Ministry of Human Resources and Emiratisation (MoHRE) took into consideration the Eid Al Adha holiday to give companies more time to reach their targets.

The holiday to mark the Islamic festival is expected to be from Tuesday, June 27, till Friday, June 30. Employees will report back to work on Monday, July 3, after the Saturday-Sunday weekend. This translates into a six-day break.

What has changed?

Companies are required to add 2 per cent Emiratis to their workforce every year until 2026. Earlier this year, a new mechanism was announced, where the annual target is split into two: Add 1 per cent in the first half of the year and the other 1 per cent in the second.

Most companies added 2 per cent Emiratis to their workforce by the end of 2022 and were required to add another 1 per cent by June 30. The deadline to have 3 per cent Emirati employees has now been pushed to July 7.

When will fines apply?

Non-compliant companies will face a Dh42,000 fine for each Emirati not employed starting July 8. The calculation is Dh7,000 per month for each Emirati not hired for 2023 — up from Dh6,000 last year.

The MoHRE had issued fines amounting to Dh400 million against private companies that failed to meet their Emiratisation targets of 2022.

Why was the deadline extended?

The MoHRE said in a statement: “As the ministry is committed to achieving its objectives of creating a competitive job market for UAE nationals and developing their skills through more collaboration with the private sector, we decided to allow more time for companies to comply with the decision and avoid relevant penalties. We call on companies to take advantage of the extended deadline to reach their targets.”

What happens after July 8?

Companies will need to add another 1 per cent by the end of 2023, which means their skilled staff must consist of 4 per cent Emiratis by December 31 this year.

Do fines increase every year?

The monthly fines will increase by Dh1,000 every year until 2026. In 2023, non-compliant employers face a penalty of Dh7,000 a month for each Emirati that has not been hired. This will increase to Dh8,000 in 2024, Dh9,000 in 2025 and Dh10,000 in 2026.

What is the purpose of Emiratisation?

The ministry said Emiratisation aims to “activate and enhance the role and competitiveness of UAE nationals in the labour market, and ensure their active participation in the economic development”.

“Emirati professionals have proven their competence across a range of positions in the private sector that require a high level of efficiency and knowledge. This provides an enormous boost to our efforts, in line with the government’s objectives and vision. We consider the private sector to be an active partner in achieving a long-term growth, as our collaborative efforts will benefit the job market.”

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