Emiratisation explained: UAE citizens in private sector to get extra Dh7,000 a month

Latest move is expected to convince more Emiratis to join the private sector

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Emiratis with a university degree who work in the private sector will now receive a Dh7,000 monthly salary top-up, up from Dh5,000 at present.

The changes were announced at a meeting of 500 senior government leaders on Wednesday.

The payment will be Dh6,000 for diploma holders and Dh5,000 for high school graduates.

The move is designed to attract more Emiratis away from government jobs, where salaries tend to be higher.

“There is no doubt that raising the levels of Emiratisation will reflect positively on the national economy,” said Dr Abdulrahman Al Awar, Minister of Human Resources and Emiratisation.

A greater mix of Emiratis and foreign talent will give the private sector “higher levels of flexibility and greater opportunities to face global and local challenges”, he said.

Here is a quick recap of the recent Emiratisation changes:

What are the current Emiratisation rules?

For years, the government has been trying to boost the number of Emiratis who work for private companies.

Public sector hours and wages have traditionally been more attractive, and many UAE citizens have felt more comfortable in public service.

In September, leaders set out quotas for the first time and gave private companies deadlines to hit them.

By January 1, 2023, every privately owned business with more than 50 employees must ensure that 2 per cent of its workforce is Emirati.

That will rise by 2 per cent every year. By 2026, the government expects 10 per cent of the average workforce to be Emirati.

Companies registered in free zones, such as Dubai Media City and the Dubai International Financial Centre, are exempt from the quota but are encouraged to hire UAE citizens.

December 31 is the last day for companies to hit the initial 2 per cent quota.

Why the top-up payments?

Officials say they are pragmatic about the expectations of Emirati university graduates, in particular, who want a good starting salary.

At the same time, they know that private businesses operate in a highly competitive market and cannot pay people high salaries simply to hit a quota.

The salary top-up was introduced for this reason.

Emiratis who work in the private sector and who have children get a boost in child support payments. AP

For example, an Emirati graduate being offered Dh13,000 a month in a starting role would take home Dh18,000 under the original Nafis programme, set out in September 2021.

This would now be Dh20,000 following Wednesday's decision.

There are other benefits available, particularly for those having children. This includes Dh800 a child every month, up to Dh3,200 per family, in support for Emiratis in the private sector.

What happens if companies don't hit the deadline?

The government has already said that there will be a financial penalty for companies that have not hit the quota.

This would be Dh72,000 in January, or Dh6,000 a month for every month in 2022.

“There have been very positive indicators that we have witnessed recently as the deadline is approaching,” a spokesman for the Nafis programme told The National.

“Having said that, we are confident that our private sector partners will continue working towards achieving the required targets.”

He repeated that employers are expected to hit the 4 per cent target before January 2024.

“We are also hopeful that those who have not hired enough Emiratis do so before the deadline, as by next year the target will be doubled,” he said.

Which companies are hiring the most?

Semi-government companies and local banks are currently the main employers of Emiratis in the private sector.

Companies such as Emirates Global Aluminium and Strata, the aircraft parts manufacturer based in Al Ain, are major employers of UAE citizens, with thousands on the payroll.

It is the wholly privately owned businesses that officials want to see act.

In July, the Ministry of Human Resources and Emiratisation recognised 16 employers that tripled their hiring of Emiratis, far beyond the target.

These include several divisions of Majid Al Futtaim, Orient Insurance and oil services company Halliburton.

What's the big picture?

The country's leaders want to ensure 75,000 Emiratis enter the private sector in the next four years.

Last year, Dh24 billion ($6 billion) was pledged for the project to cover salary support and other factors.

“It is a moving market with new graduates coming in stream and thousands of jobs are created,” the Nafis spokesman said.

“We believe that in our dynamic economy, there will always be opportunities for everyone. In the meantime, we can tell you that what we see on the ground is very promising, but we aspire to see more.”

Updated: November 24, 2022, 8:16 AM
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