A lack of private sector Emiratisation is disappointing but not surprising.
While observers and stakeholders in the private-sector Emiratisation process express frustration at its slow progress, we should not underestimate the monumental shift in UAE employee-employer relations that will be needed to ensure its success.
Since the discovery of oil in Abu Dhabi and the rapid social and economic expansion that was funded by this resource, the UAE has essentially operated with two distinct employment markets.
The public sector has traditionally been, and remains, the employment market of choice for Emiratis, who were rightly seen as the most appropriate stakeholders to ensure that government offices functioned with the best interests of the UAE and its citizens. Where skills and expertise in certain areas were unavailable, expatriates were employed to supplement and support organisational functioning. Public-sector working conditions were established in line with many practices from more economically developed nations to promote harmonious working conditions that would be satisfactory to UAE.
Such conditions included a five-day working week, generous leave allowances, employment protection and structured advancement processes, among others. In many ways this employment market represents an environment similar to regions such as the UK and mainland Europe.
The UAE’s public-sector employment market operated with a focus on efficient governance of the UAE, social integration of UAE citizens into a young and rapidly growing nation and the redistribution of oil revenues to Emiratis and the UAE economy. The employment market evolved in consultation with its citizen stakeholders, to the benefit of employee and employer.
The UAE private-sector employment market, on the other hand, was almost exclusively focused on economic development and profit. Consequently a very liberal regulatory framework was applied to it. There was no place for worker forums or representation; concerns for getting the job done at the lowest cost with the highest profit margin were paramount.
The power in the employment relationship rested almost exclusively with the employer, with the employee having signed a contract and come to the UAE in a very weak position.
The consequences of this weak employee position led to cases of exploitation and abuse, which the UAE Government acted upon through stricter regulation and clearer laws. Clear punishments are outlined for companies that breach those laws, and there are many cases of judgements against companies that have been brought to the Ministry of Labour by employees who have not been given their legal rights.
Despite the improving and evolving employment legislation, there still exists a significant imbalance of power in the UAE private sector employer-employee relationship. Reports of unpaid and delayed payment of wages, denial of leave, withholding of passports, contract substitution, unpaid overtime and other breaches of employment rules still occur, as employees are often ignorant of their rights or in such weak positions that they fear an unsuccessful case brought to the Ministry of Labour might leave them in financial ruin.
It should not be surprising then that some businesses would also disregard new legislation focused on Emiratisation.
The difference now, however, is that Emiratis are in a much stronger position, as citizens of the country, than expatriate workers have ever been. As such, they are perfectly placed to challenge businesses and highlight any lack of compliance with employment regulations generally and Emiratisation legislation specifically.
The greater involvement of Emiratis in the private sector will undoubtedly change the employment market landscape of the UAE.
The UAE Government is continually looking at ways to enhance employee and Emiratisation legislation and engages with entities such as the International Labour Organization. However, it must also consider the perspectives of business leaders and lobbyists.
The influence of these lobbyists in the region should not be underestimated. Saudi Arabia has recently made efforts to align the public and private sector working week to five days and has gone as far as preparing legislation to that effect in support of its own Saudisation policies. However, the planned two-day weekend for private sector employees was rejected because of concerns over increases in business and labour costs.
There must be a balance between suitable and socially responsible employment opportunities for a country’s citizens and the continuing economic growth and development of that country.
That balance will require a significant change in the traditional employee-employer relationship of the UAE private-sector employment market. This is a change that is likely to benefit all private sector workers – Emirati and expatriate.
James Ryan is an associate professor of human resource management and organisational behaviour at UAE University
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