The new Emiratisation rule in 2024 is an amount by the government to comply with a national policy. This national strategy of the United Arab Emirates consists of increasing the participation of Emirati citizens. Specifically, in the private labor market of the UAE. This new rule says that private companies have to hire at least 1 Emirati. Especially earlier January 1, 2024, and maintain that minimum number throughout the year.
In this article, we will examine and show you the details and implications of the new Emiratisation rule in 2024. Specifically, we will show you what the purposes of this new rule are, that is, what they have to do. In addition, we will show you the requirements and conditions that companies must have to comply with the new rule. We are also going to show you the challenges and benefits that the companies and Emiratis involved will enjoy. With all this information you can comply with this new rule by having all the essential knowledge.
Goals of New Emiratisation Rule in 2024
The emiratization rule has been in place in the country since September 2022. At that time, the authorities announced quotas for the hiring of local citizens for the first time. In addition, they provided deadlines for private companies to reach the corresponding Emiratization quota.
Companies that are in the private sector and have at least 50 employees must have a quota. Specifically, 3% of the workforce of these companies must be made up of Emiratis by July 2022.
Now, since July 11, the MoHRE released a new update to the Emiratisation rules. That is to say, there is a new Emiratisation with higher quotas to meet. Currently, according to this new rule, private companies have to be a part of the government’s Emiratization campaign. Specifically, those that have 20 and 49 employees.
The new Emiratisation rule is exclusively for companies belonging to 14 economic sectors.
- Communications and Information,
- Health Insurance and Finances
- Real Estate.
- Technical and Professional Activities
- Support and Administrative Services.
- Education
- Social Work and Healthcare
- Arts and Entertainment
- Quarrying and Mining
- Manufacturing Industries
- Construction
- Retail and Wholesale
- Warehousing and Transportation
- Residency Services and Hospitality
The new Emiratisation rule expects that the employment rate will reach 6% in 2024. Subsequently, the idea is that by 2025 it will be 8%. Finally, the goal is that by 2026 the employment rate will be 10%.
It is important to highlight these end-of-year objectives that must still be met. However, it is essential that private companies now have to ensure they achieve them. Essentially, companies have to comply with raising 1% over the course of six months.
There are exceptions to all these measures and they are in high positions in companies and companies in free zones. However, the government still provides certain initiatives to encourage companies to take the initiative.
Specifics of the Requirement for Firms with 20–49 Employees
The regulations announced in November 2023 bring many changes for smaller companies. All this by the Ministry of Human Resources and Emiratization in the UAE. The new Emiratisation rule is for private companies with between 20 and 49 employees.
Specifically, the rule dictates that these companies have to hire a local citizen in 2024. Subsequently, the idea is to hire another in 2025 as you saw above. If you do not comply with the new Emiratisation rule you have to pay the corresponding fines.
This measure expects to create approximately 12,000 jobs per year for the country’s citizens. It is important to highlight that this is specifically in various economic sectors. For instance, the most important one that wants to comply with the rule is the life sciences industry.
On the other hand, you have to know that larger companies have to achieve a larger share than in the previous case. The emiratization amount is 2% of the employment rate for competent jobs. When talking about larger companies, this refers to companies with more than 50 employees.
Additionally, the companies that called have to meet specific criteria. However, companies that do not have these criteria of the Emiratization law have to face serious consequences. That is annual financial contributions from January 2025.
It is important to mention that the sanctions will be higher than 96,000 AED for each missing citizen in the company. The changes are for three categories of covered employers according to the relevant Emiratisation level.
- Level 1: Employers who specifically comply with the new Emiratisation rule, requirements, and employment legislation.
- Level 2: Employers who have evidence of meeting Emiratisation requirements.
- Third level: Employers that do not comply with the Emiratization requirements and the Federal Labor Law. Specifically, over the course of two financial years.
Timeline and Deadlines for Compliance with the Emiratisation Rule
The government established deadlines to comply with the new Emiratisation rule 2024. Specifically, those private companies that received the selection call.
- From January 1, 2024: Private companies that have between 20 and 49 employees on their payroll must hire at least one local citizen. Of course, these requests will depend entirely on the magnitude and economic sector of the company.
- From January 1, 2025: Private companies that have between 20 and 49 employees on payroll must hire at least two local citizens. Of course, the entirely these requests will depend entirely on the magnitude and economic sector of the company.
- Consequences: If companies do not comply with the new Emiratisation rule they have to pay very expensive fines. The fees of these fines range from 96,000 AED to an extreme of 500,000 AED, everything will depend on the consecutive years without compliance.
- Final Objective of the New Emiratisation rule: The final objective of this measure or initiative was a minimum of a 10% increase in the employment rate. That is, increase the competent workforce corresponding to the Emiratisation by 2026.
Potential Benefits and Challenges for Companies in Implementing
The new Emiratisation rule offers companies many benefits. For this reason, you can find these benefits thanks to Emiratisation in the UAE:
- Provide financial assistance to Emirati students.
- May require private companies to hire a certain percentage of Emirati citizens.
- Establish programs for the training and development of the skills that the Emirates needs to be successful in the world of work.
- Promotes Emirati recruitment through public awareness campaigns.
Thanks to the ingenuities of the Emiratisation law and the 2024 new Emiratisation rule, many advances have been accomplished in recent years. In this way, the digit of Emirates in a job in the private sector increased from 6% to 10% in 13 years.
Although Emiratization is very original for the UAE private sector, it presents many trials. However, this not only challenges the private sector but also challenges Emirati citizens in many ways.
Among the challenges facing the private sector are:
- In the UAE only 12% of its population are Emirates. For this reason, it is difficult for companies to find the right Emirati talent with the necessary skills for the position.
- Private companies may have problems hiring and managing Emirates. This is because there is a lack of motivation to improve since they are aware of the Emiratization policies.
- When private companies find a suitable person, it is very likely that they do not have enough experience. Therefore, training them can be very expensive and an unnecessary waste of time.
- Many Emirates struggle with English and working with people from different countries can present many problems with communicating and collaborating.
- Cultural saturation may occur due to people who prefer to work with people with similar backgrounds to each other.
Emiratisation Gateway will Help you Comply with 2024 New Emiratisation Rule:
Complying with the new Emiratisation rule and with Emiratisation in general it is essential for all companies. Furthermore, this new law came into effect on January 1 of this year, 2024. Therefore, private sector companies have to hire a minimum of Emirati citizens.
Emiratisation Gateway is the ideal ally so that you can comply with the 2024 new emiratisation rule. Additionally, you can find an online platform that offers solutions so that your company can comply with the emiratization standard.
Our assemblage of experts is available to advise you throughout the process of Emiratization of your establishment. This way, your enterprise can fulfil all the systems set by the UAE direction and avoid any kind of problem.
For this goal, if you want your enterprise to achieve Emiratization, do not hesitate to contact us. Additionally, you can book an appointment on our website to find more information about Emiratisation in the UAE and other important aspects.
