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UAE’s New Laws for Businesses in 2024
Published 10 Jan 2024
Emirates unveils several important laws as a sure step into 2024. The laws touch on Emiratization and labor regulation issues in many industries including construction.
Emiratisation Targets
The Emirati Human Resources Competitiveness Council, known as 'Nafis,' actively implements national initiatives to enhance Emiratisation in the private sector. [?] The council focuses on increasing the competitiveness of Emirati citizens and providing the private sector with valuable Emirati skills.
Objectives
Aim to integrate 75,000 citizens into the private sector within the next five years.
Offer various initiatives to empower Emirati talents and incentivize private companies to attract local expertise.
Emiratisation Targets for Smaller Companies (20 to 49 workers)
Starting from 2024, companies with 20 to 49 workers must employ at least one UAE citizen.
From 2025, these companies will be required to hire at least two Emirati citizens.
Previously, this mandate applied only to companies with 50 or more employees. [?]
Emiratisation Rates for Larger Companies (50 or more employees)
Cabinet-approved decision to raise Emiratisation rates to 2% annually for skilled jobs in companies with 50 or more employees.
Targeting an overall increase of 10% by 2026.
Incentives granted to institutions excelling in the training and employment of citizens.
Enforcement Measures
Non-compliant companies will face a monthly payment of AED 6,000 for each unemployed citizen from January 2023.
The monthly contribution will increase by AED 1,000 annually until 2026.
Note, the Ministry of Human Resources and Emiratisation (MoHRE) and the Cabinet Secretariat collaborate to monitor implementation.
Penalties for Non-Compliance
Companies with 20 to 49 workers failing to employ at least one Emirati in 2024 will pay a financial contribution of AED 96,000 to the government.
This contribution increases to AED 108,000 for companies not employing two Emiratis by 2025.
It is crucial that targeted companies register to the Nafis platform in order to benefit from the support the programme provides in terms of supplying the private sector with qualified Emirati professionals capable of efficiently working in various targeted economic sectors, along with other advantages they can benefit from.
The Ministry of Human Resources and Emiratisation (MoHRE)
Labour Regulation
The Ministry of Human Resources and Emiratisation (MoHRE) has enforced amendments to Federal Law No. 20 of 2023 on labor relations, effective from the first Monday of January 2024. [?]
The Ministry of Human Resources and Emiratisation
Source: mohre.gov.ae
Source: mohre.gov.ae
The enforcement aligns with ongoing legislative development efforts aimed at bolstering the global competitiveness of the UAE's labor market.
The amendments prioritize the rights of all parties engaged in contractual labor relations, fostering a legislative environment characterized by fairness, transparency, honesty, and neutrality. Notably, the Ministry now holds the authority for the conclusive resolution of disputes related to contractual labor relationships in private sector establishments, particularly if the disputed amount is AED 50,000 (USD 13,600) or less.
The decisions made by the Ministry in such matters are both executive and final.
The amendments prioritize the rights of all parties engaged in contractual labor relations, fostering a legislative environment characterized by fairness, transparency, honesty, and neutrality. Notably, the Ministry now holds the authority for the conclusive resolution of disputes related to contractual labor relationships in private sector establishments, particularly if the disputed amount is AED 50,000 (USD 13,600) or less.
The decisions made by the Ministry in such matters are both executive and final.
The information provided in this blog article is for informational purposes only and is not intended as legal advice. For any legal concerns or advice, please consult with a qualified attorney.
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