May 22, 2022
As part of the 50 for 50 initiatives, the UAE government has delivered on their promises for expanding foreign ownership as well as creating many new opportunities for the private sector in the UAE.
It would be fair to say that the balance of the working population in the private sector is skewed towards expatriates and naturally, the government is addressing this imbalance with a number of new rules, benefits and of course penalties for non-compliance. The new rules were announced on 9 May 2022 as a Cabinet Decision.
Nafis is a federal program to increase the competitiveness of Emirati human resources and empower them to occupy jobs in the private sector. Launched as part of “Projects of the 50”, the program aims to accelerate the UAE’s development journey and boost the economy.
If you have a business registered on the UAE mainland, and you employ 50 people or more, then yes.
Free zone businesses are not currently within the scope of the Emiratisation programme, but we can expect some scrutiny there for businesses over 50 employees in cases where the free zones are being used to avoid the new regulations.
If you are not on the mainland or you employe less than 50 people, you don't need to take any action for now.
The first action you will need to take is to review your current profile of local vs expat employees and consider whether you already meet the target.
As a quick rule of thumb, your business will need to meet the targets of:
a) 2% of skilled workers, rising to
b) 10% by 2026.
The 2% rule has been around for many years but it will be strictly enforced by 1 Jan 2023 along with the 10% target by 2026.
Whilst at first glance the new rules may be of concern if you have not already been planning for it, but the good news is that there are a number of benefits to ease the impact on your business, including:
a) Discounts on government fees,
b) Generous salary support for key roles,
c) Pension contribution support,
d) Child support
On the flip side, non-compliance leads to monthly penalties.
Don't delay, talk to your contact at OnPro and we will be delighted to assist you with a review and plan of action to keep your business on track.
