UAE labour law: What relaxed visa rules mean for the job market

New laws have shaken up the private sector work landscape in the UAE.

The amended labour regulations, which were first outlined by the government in November 2021 and came into effect on Feburary 2, 2022 provide options that were not available before and strengthen employees' rights.

One of the major changes under the new rules is that people will be able to live in the country for up to six months after leaving a job.

Shorter, fixed-term contracts will also be introduced for most private-sector employees and some residents will now have the option to condense their working week as long as the contracted hours are met.

This may spur some individuals to make the jump and look for a role that is better for them

Emily Roberts,
Genie recruitment

Louise Vine, managing director at Inspire Selection recruitment agency in Dubai, said she is encouraged by the new law.

“When someone loses their job, they have six months to find a new one instead of only 30 days, so it offers more stability for their family,” she said.

“Also, when someone wants to quit because they really do not like their job, they now have six months to find another, so feel less pressured into accepting a job they do not want.

“It also gives them time to find a job that they're really happy with, at the right level and the right salary and so on.”

In her years as a recruiter, Ms Vine said she has come across people who have “accepted jobs out of desperation”, only to have a visa, which buys them time to find their ideal job.

She said this short-term employment is financially detrimental to the employer and creates an unstable work environment.

Recruiter Louise Vine says she has come across people who have accepted jobs out of desperation, only to have a visa, which buys them time to find their ideal job. Photo: Louise Vine

“Despite the law change, we don't see the great resignation phenomenon which has been reported in the US happening here,” said Ms Vine.

“The UAE is very different from the US and while this new law does allow people to walk away from their jobs more easily, the majority of people we come across are looking for work and are very keen to continue earning. Not many are in a position to spend six months with no pay due to the high cost of living.”

Emily Roberts, a consultant at Genie, a recruitment agency in Dubai, said the move will have a positive effect on workplace well-being and environments, as many job seekers can now spend time searching for the right opportunity.

“I believe this may spur some individuals to make the jump and look for a role that is better for them,” she said.

“As a recruiter, I do come across a lot of candidates who are deeply unhappy in their roles, which can be due to a number of reasons [such as] poor management or no work-life balance.”

A lot of people could not take the leap of resigning in the past, without another role confirmed, mainly because of the visa restrictions they would face, she said.

“The 180-day security will support those individuals who are itching to make a move and allow time to find a new position that suits them rather than perhaps rushing a process to accept something quickly,” said Ms Roberts.

“This will also give the opportunity for good talent to stay within the region as there's longer to secure something adequate.”

With an influx of expatriates looking to move to the region, she said the law changes will lead to “better retention rates for employers”, as they can be assured that the individual has had the time to consider all of their options before taking the best role for them.

Emirati lawyer Awatif Mohammed said the new law enhances the rights of both employers and employees.

“Employees will not fear losing jobs on the spot with the mandatory 14-day notice period during probation that employers must abide to,” he said.

“The market will further attract talents and skills from across the world, especially after allowing different styles of work, a move that came in response to the challenges forced by Covid-19 but proved necessary to the progress the country is witnessing.”

How job sharing works

Under the condensed hours options, if an employee is expected to work 40 hours a week under their contract, they can now work those hours over three days, said Abdulrahman Al Awar, Minister of Human Resources and Emiratisation.

Other flexible working options include shared jobs, when two people work in a single role and split the hours after agreeing to the arrangement with their employer.

David McKenzie says the shared job option would benefit working mothers considerably. Photo: Ravindranath K / The National

David McKenzie, group managing director of recruitment agency Mackenzie Jones, said the shared job option would be beneficial for those looking to get back to work after time off.

“If you think about people doing job shares, they will most likely be working mothers looking to get back to part-time work,” he said.

“As they will already be supported by a spousal visa, all they would need is a labour card.

“By introducing this working structure as an option, what you’re doing is empowering people in the workplace who didn’t have many options before.”

With input from Salam Al Amir

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Group B

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Tuesday Feb 26, 9.30am, v Saudi

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Timeline

1947
Ferrari’s road-car company is formed and its first badged car, the 125 S, rolls off the assembly line

1962
250 GTO is unveiled

1969
Fiat becomes a Ferrari shareholder, acquiring 50 per cent of the company

1972
The Fiorano circuit, Ferrari’s racetrack for development and testing, opens

1976
First automatic Ferrari, the 400 Automatic, is made

1987
F40 launched

1988
Enzo Ferrari dies; Fiat expands its stake in the company to 90 per cent

2002
The Enzo model is announced

2010
Ferrari World opens in Abu Dhabi

2011
First four-wheel drive Ferrari, the FF, is unveiled

2013
LaFerrari, the first Ferrari hybrid, arrives

2014
Fiat Chrysler announces the split of Ferrari from the parent company

2015
Ferrari launches on Wall Street

2017
812 Superfast unveiled; Ferrari celebrates its 70th anniversary

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Company%C2%A0profile

%3Cp%3E%3Cstrong%3ECompany%20name%3A%20%3C%2Fstrong%3ELeap%0D%3Cbr%3E%3Cstrong%3EStarted%3A%20%3C%2Fstrong%3EMarch%202021%0D%3Cbr%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Ziad%20Toqan%20and%20Jamil%20Khammu%0D%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20Dubai%0D%3Cbr%3E%3Cstrong%3ESector%3A%20%3C%2Fstrong%3EFinTech%0D%3Cbr%3E%3Cstrong%3EInvestment%20stage%3A%20%3C%2Fstrong%3EPre-seed%0D%3Cbr%3E%3Cstrong%3EFunds%20raised%3A%3C%2Fstrong%3E%20Undisclosed%0D%3Cbr%3E%3Cstrong%3ECurrent%20number%20of%20staff%3A%20%3C%2Fstrong%3ESeven%3C%2Fp%3E%0A

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COMPANY%20PROFILE%20

%3Cp%3E%3Cstrong%3EName%3A%3C%2Fstrong%3E%20Haltia.ai%0D%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%202023%0D%3Cbr%3E%3Cstrong%3ECo-founders%3A%3C%2Fstrong%3E%20Arto%20Bendiken%20and%20Talal%20Thabet%0D%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20Dubai%2C%20UAE%0D%3Cbr%3E%3Cstrong%3EIndustry%3A%3C%2Fstrong%3E%20AI%0D%3Cbr%3E%3Cstrong%3ENumber%20of%20employees%3A%3C%2Fstrong%3E%2041%0D%3Cbr%3E%3Cstrong%3EFunding%3A%3C%2Fstrong%3E%20About%20%241.7%20million%0D%3Cbr%3E%3Cstrong%3EInvestors%3A%3C%2Fstrong%3E%20Self%2C%20family%20and%20friends%26nbsp%3B%3C%2Fp%3E%0A

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.”

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Employees: Nine

Amount raised: $1.2 million

Funders: Oman Technology Fund, AB Accelerator, 500 Startups, private backers

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