'Will cancelling my work visa to obtain Abu Dhabi golden visa affect my gratuity?'

Question: I own a property in Abu Dhabi and am applying for a golden visa. I am an employee and want to continue in my job. To get the golden visa, my work visa has to be cancelled so I don’t understand how I stay employed and have medical insurance. What happens to my gratuity? MY, Abu Dhabi

Answer: In this situation, a person remains employed with continuous and unchanged terms of employment. It is just the visa that changes.

The golden visa replaces the residency visa issued by an employer. The employer then applies for a non-sponsored work permit, as this permit, known colloquially as a labour card, must be provided for all employees in the UAE, no matter their visa situation.

The employer is also legally obliged to continue providing medical insurance, exactly as before. This must be for the employee and their family in accordance with the Department of Health – Abu Dhabi requirements and should be a continuation of cover.

The terms of employment will be unchanged, including entitlement to the end-of-service gratuity, in line with the contract that is registered with the Ministry of Human Resources and Emiratisation.

Q: I work with someone who posts on Instagram and TikTok every day and who seems to hate his life in the UAE. He has been stopped from naming our employer but he still posts insults about companies and places here.

I have told him that this is not a good thing to do and that he can get into trouble, but he doesn’t believe me and says he can say what he likes. How can I explain that he is being disrespectful to the country and that his behaviour is not acceptable? CT, Dubai

A: The UAE has codes of conduct of behaviour and CT’s colleague is breaking UAE laws.

Dubai Public Prosecution has issued press releases and videos to explain the law and to remind people to behave appropriately.

In a video issued in June 2020, which is still valid, the Public Prosecution reminded people that those who publish “information, news, statements or rumours” online with the intent to “damage the reputation, prestige or statute of the State or any of its institutions or its president, vice-president, any of the rulers of the Emirates, their crown princes, or the deputy rulers of the Emirates, the State flag, the national peace, its logo, national anthem or any of its symbols, shall be punished by temporary imprisonment and a fine not in excess of Dh1 million”.

This applies to all users of social media and people need to be responsible when posting online.

Q: I work for a UAE company but will be transferring to the Bahrain office next month. I plan to start a family as I am now married and although I do plan to carry on working, I am concerned about the maternity leave. It is a new office and no one seems to know very much about laws and I can’t really ask in this case. I have just been told that it is a lot like the UAE. CC, Dubai

A: Bahrain has laws separate to the UAE and employment is governed by Law No 36 of 2012, Labour Law for the Private Sector. There have been a few enhancements over the years but the main rules are unchanged.

The subject of maternity leave is covered in Article 32 of the law. This states: “A female worker shall be entitled to maternity leave on full pay for sixty (60) days which shall include the period before and after her confinement provided she produces a medical certificate attested by a government health centre or one of the clinics approved by the employer stating the expected date of her confinement.”

This leave can be extended for medical reasons. “A female worker may obtain an additional leave without pay due to her confinement for a period of fifteen (15) days in addition to the aforesaid leave.”

The law goes on to say, “It shall be prohibited for a female worker to work during the forty (40) days following her confinement.” This means that she must have time off work.

The law does not make any mention of a period of employment before this applies but it would still be wise for CC to request that her new contract of employment in Bahrain refers to continual employment for the purpose of such benefits.

Usefully, the law makes some provision for women to take time off to care for young children. This is unpaid and has limitations but is still helpful to working parents

It is also worth pointing out Article 33 of the law. “It shall be prohibited for an employer to dismiss a female worker or to terminate her contract of employment because of marriage or during maternity leave.”

The advice provided in our columns does not constitute legal advice and is provided for information only

Contact Keren at keren@holbornassets.com or at www.financialuae.com

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”