Legal Insight Q&A: Emiratization

1. What is Emiratization?

Emiratization is the UAE government’s initiative to increase the number of UAE Nationals employed in the public and private sectors. (Note, the remainder of these questions solely address questions regarding Emiratization requirements for mainland private sector companies).

From January 2023 the UAE government set out mandates for hiring Emirati nationals and gave private sector companies deadlines to reach these mandates.

 

2. Who is a UAE National for Emiratization purposes?

An Emirati national is a person with a family book. The family book serves as the official record of a family unit and means citizenship with all rights and obligations. The Emirati national with a family book is the only Emirati national recognized by MOHRE for Emiratization requirements.

 

3. Where and to whom does Emiratization apply?

All private sector companies registered in mainland UAE. The mandates do not apply to companies in the Free Zones or the Financial Free Zones, (DIFC and ADGM).

 

4. What are the specific requirements of Emiratizaton for private sector mainland company employers?

The mandate for all private companies by the end of the year 2023 was that 4% of their skilled workforce be Emirati nationals. For all private companies, Emiratization rates are to increase annually by 2% to achieve a minimum of 10% of its skilled employees being Emirati nationals by 2026. To achieve the mandates, companies are required to meet rates by 1% every six (6) months to achieve a 2% increase by the end of the year. i.e. June 30 and December 31 are target dates to meet the 1% increase.

For 2024, the overall rate by December 31 shall become 6% (i.e. June 30 rate is 5% and shall become 6% by December 31, 2024).

For 2025, the overall rate by December 31, shall become 8% (i.e. June 30 rate is 7% and shall become 8% by December 31, 2024).

From July 2023 private companies with 20-49 skilled employees are required to hire one (1) Emirati national in 2024 and another in 2025.

 

5. What is a skilled worker?

Labor is classified as skilled work if it meets the four (4) following conditions.

  • The employee must be at a professional level (among first to fifth level set out below).
  • The employee has obtained a certificate higher than a secondary certificate or an equivalent certificate.
  • The competent authorities must attest the certificate.
  • The monthly salary (excluding commission) of the employee must not be less than AED 4,000.

 

Professional levels of jobs in the UAE (per MOHRE)

The MOHRE classifies employment into 9 professional levels according to the International Standard Classification of Occupation (ISCO) issued by the International Labor Organization. The levels are:

Level 1: Legislators, managers, and business executives.

Level 2: Professionals in scientific, technical, and human fields.

Level 3: Technicians in scientific, technical, and humanitarian fields.

Level 4: Writing professionals.

Level 5: Service and sales occupations.

Level 6: Skilled employees in agriculture, fisheries, and animal husbandry.

Level 7: Craftsmen in construction, mining, and other craftsmen.

Level 8: Operators and assemblers of machinery and equipment.

Level 9: Simple professions.

 

6. What if the company does not meet its Emiratization requirement?

The company will be required to pay a fine (referred to as an assessed contribution) per every Emirati national not employed as mandated. If the company does not pay the assessed contribution, the MOHRE may suspend the issuance and renewal of work permits for the company. Where the company fails to meet its Emiratization mandate for two consecutive years it will be reclassified and downgraded to a Category three (3) company which is subject to higher MOHRE service fees.

 

7. Are there any government programs or initiatives that work with employers to employ Emirati nationals?

Yes, the Nafis program aims to support the employment of Emirati nationals in the private sector. The Nafis initiative provides many resources for Emirati nationals and assists private-sector employers in connecting with Emirati national job seekers. The resources include career counseling, apprenticeship program support, an Emirati salary support scheme, and many other significant benefits.

 

8. Any other resources that employers have at their disposal to meet targets?

Consider working with local technical colleges and universities that have large Emirati populations. Approach the on-campus Career counseling center and directly connect with workplace coordinators whose ultimate mission is to get Emirati nationals gainfully employed.

Timely meeting of the Emiratization requirements is imperative for private-sector companies to diversify their workforce, avoid fines and penalties. Should you have questions or concerns regarding Emiratization

 

Please feel free to contact Gloria Estolano Strategic Partner at M&CO Legal.

 

Disclaimer

This publication does not provide any legal advice and it is for information purposes only. You should not rely upon the material or information in this publication as a basis for making any business, legal or other decisions. Therefore, any reliance on such material is strictly at your own risk.

Author: Gloria Estolano (Strategic Partner)

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Strategic Partner – Employment Law – Gloria Estolano

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Strategic Partner – Employment Law – Gloria Estolano

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