Emiratization in UAE Explain: Fine and Deadline 2024
The Emaratization policy, a key initiative under the ‘We the UAE 2031’ strategy, aims to boost the UAE’s GDP from $405.6 billion to $816.7 billion within the next decade. First introduced in 2021, Emaratization is gaining renewed attention in July 2024 as it officially takes effect. This implementation phase will include company inspections, compliance checks, and potential penalty payments for non-compliance.
The Ministry of Human Resources and Emiratisation (MoHRE) has identified around 12,000 companies with 20-49 employees that must meet new hiring requirements. These businesses must employ at least one UAE citizen in 2024, with an additional Emirati hire needed in 2025. This crucial policy is designed to increase Emirati participation in the workforce, supporting the UAE’s broader economic and development goals.
Emaratization Fine in 2024
For 2024, the fine is Dh8,000 per month for each Emirati not hired. Previously, the fine was Dh7,000 per in 2023 and Dh6,000 monthly in 2022. Subsequently, the penalties will increase by Dh1,000 annually until 2026.
Private companies in the country must increase the number of Emirati employees by two per cent every year. By the end of last year, companies were required to have 4% Emirati employees. By the end of this month (June), this should be upped to 5%. Before 2024 ends, a firm’s workforce must have 6% UAE nationals.
Emiratisation Rules
A federal law aims to raise the Emiratisation target by 2% annually to reach 10% of a company’s workforce by the end of 2026. The annual target is split in two – 1% in the first six months, and the other 1% in the second half of the year.
Use the Nafis Online Platform
MOHRE urged companies yet to meet their Emiratisation targets to take advantage of the Nafis Programme’s digital platform, “which allows them access to a wide pool of qualified Emirati job seekers across various specialisations.”
In May this year, Mohre announced that more than 97,000 Emiratis are now working in about 20,000 private companies in the country.
What is the “Emiratization” Policy?
Emiratization is a national workforce policy in the UAE that aims to increase Emirati employment in the private sector. It also is a powerful tool for strengthening national identity and nurturing Emirati culture.
There are various objectives for the Emiratization policy, including:
- Enhancing employment opportunities for Emiratis
- Reducing reliance on foreign labour
- Enhancing UAE Nationals’ skills and capabilities
- Allowing UAE National to help drive economic growth and sustainability
Background of Emiratization Policy
With a population of 10.17 million, Emiratis make up the minority at 11.48%, while expatriates dominate at 88.52. Therefore, Emiratization is a strategic initiative to address this imbalance and reduce reliance on foreign labour.
The Middle East Economy explains the historical background of the Emiratization policy. Before oil discovery, the UAE’s economy heavily relied on fishing and pearl diving. However, when the UAE struck oil in the late 1960s, it brought rapid economic growth followed by reliance on foreign labour.
As a result, the high influx of foreign workers took most of the employment opportunities. This reliance created imbalance and limited opportunities for Emaratis to upskill.
The UAE government implemented Emiratization policies in the early 2000s to rectify this. These policies aimed to enhance Emiratis’ participation in the private sector workforce.
Emiratization has evolved, incorporating initiatives to incentivise private companies to hire and train Emiratis. Measures like training programs, government subsidies, and industry-specific Emirati employment quotas have been implemented.
These efforts have improved the situation, allowing Emiratis to contribute to the UAE’s growth and development actively. However, the government is accelerating this effort to achieve its target of having at least 10% of Emiratis in private sector companies with at least 50 employees.
Objectives of Emiratization in the UAE
Strategies to achieve Emiratization
- Providing more job opportunities by partnering with the private sector enables the private sector to play a larger role in economic growth and job creation.
- Government-set quotas for Emirati employment in specific industries and incentives for those companies that meet these targets.
- Emirati workers benefit from training and development programs that improve their skills and competitiveness.
- In addition to promoting high-skilled industries, the government encourages young Emiratis to pursue training in technical and vocational fields.
- The government ensures compliance with Emiratization requirements through enforcement mechanisms by implementing regulations.
Final Thoughts
Continued commitment and support are necessary to maintain and further strengthen the UAE’s Emiratization program. Investing in Emirati talent and actively encouraging their participation in the workforce can contribute to the UAE’s sustainable growth. For more information about human resources compliance in the UAE, you can reach out to info@nhmanagement.com or 800 64628.
