Emiratisation update: Deadlines pass for small and large companies

Businesses with between 20 and 49 employees had until January 1 to hire one UAE citizen

Thousands of companies in the UAE have met Emiratisation targets set out by the government. Amy Leang / The National

Companies in the UAE with between 20 and 49 employees are to face fines from January 1 if they have not achieved their Emiratisation target of hiring at least one UAE citizen.

Last year, the Ministry of Human Resources and Emiratisation notified 12,000 companies they met the criteria to be included in the expansion of Emiratisation targets for smaller companies.

Larger businesses with 50 or more employees must also, as of Monday, ensure 4 per cent of their workforce comprises Emirati employees.

A new target of 6 per cent for the end of 2024 has now been set, with a goal of 10 per cent by the end of 2026.

Businesses in free zones were exempt from the ruling.

In 2022, about 9,293 companies met the target of employing Emiratis in 2 per cent of skilled roles, according to previous figures from the ministry.

Fines and penalties

For businesses with between 20 and 49 employees, fines of Dh96,000 ($26,140) will be imposed on employers who have not met the January 1 target.

The new target set for smaller companies is to have two Emirati employees by January 1, 2025, with subsequent fines of Dh108,000 for non-compliance.

Businesses with 50 or more employees that fail to meet these targets are to be fined Dh84,000, up from Dh72,000 in 2023.

The fines will increase each year and strict penalties are in place for companies that look to evade Emiratisation targets. These include fines of up to Dh500,000 for serious breaches, such as reducing the number of employees or altering job titles.

Finding talent

Ayman Abu Halaweh, general manager of Justitia Consultants in Dubai, said he would soon be required to comply with the targets for smaller companies.

"Within the next six to 12 months, we are expanding our team to about 25 members. This brings us under the new Emiratisation targets in the UAE," he said.

”In my 15 years of working in the UAE, I have encountered numerous qualified, creative and outstanding Emirati professionals in this field. Based on what I've seen, I am confident we will not face any challenges in finding talented and qualified Emiratis for our business."

Dr Abdullah Al Nasser, an Emirati lawyer and founder of Araa Advocates Group, said the new Emiratisation targets applied to his firm as it has 20 employees.

It is in the process of hiring at least 10 staff in a new department focused on technology and AI cases.

He expressed confidence in the skills of the new generation of Emiratis in that field.

"The new generation surprises us with their rapid adaptation to technological advancements and integrating this fresh, innovative talent into our company's staff promises to elevate our performance to unprecedented heights," he said.

Frequent inspections

The ministry has been monitoring compliance to ensure employers follow the rules to meet its targets. The authorities identified 916 private companies that breached Emiratisation policies from mid-2022 to December 2023.

More than 18,000 companies have achieved the required targets, with about 88,000 Emiratis now employed in the private sector.

Emiratisation breaches include hiring family members to fill fake roles, or forging employment records by obtaining false work permits in the name of UAE citizens.

Consequence of evading targets

The ministry said the penalised companies were with fines from Dh20,000 to Dh100,000. They will also no longer receive financial benefits from the Emirati Talent Competitiveness Council programme.

Companies that breach the rules are also downgraded to the lowest categories within the private sector classification system.

That means they face higher service fees for work permits and transfer fees. Instead of paying only Dh250 for certain permits, they could be charged Dh3,750.

One Emirati employer faked employment numbers to meet the targets by hiring 43 family members to work at the company. He was liable for a potential fine of up to Dh4.3 million.

The government also introduced measures to support Emirati employment in the private sector by creating the Nafis programme, which offers salary top-ups and other benefits to Emirati graduates.

Under the initiative, an Emirati graduate offered a starting salary of Dh13,000 could take home Dh20,000. There are additional benefits for those with children.

The ministry has warned that Nafis benefits would be revoked for Emiratis involved in false Emiratisation tactics.