New Emiratisation rules mean the vast majority of companies will soon employ UAE citizens in their workforce, employment experts said.
The government on Tuesday said businesses employing between 20 and 49 people must have at least one Emirati staff member by the end of 2024, and two by the end of 2025.
The previous ruling only applied to companies with 50 staff or more. Emiratis must comprise 3 per cent of the total workforce as of this month, rising to 10 per cent by 2026.
The decision opened the door for a mandatory hiring spree in the coming months as small and medium-sized enterprises (SMEs) fulfil the requirement by 2024.
Emirati graduates are expected to benefit the most, said Dubai recruiter David Mackenzie.
"Essentially every company in the UAE will employ an Emirati at some point soon in the future," said Mr Mackenzie, group managing director with recruiters Mackenzie Jones.
"It also means there will be a lot more opportunities for UAE graduates, because SMEs won't be able to compete with bigger companies so they will look at hiring new talent that won't expect huge salaries.
"Emirati graduates will have opportunities at start-ups and SMEs, and it will most likely be a great learning curve for them to develop their talent."
Tuesday's announcement also saw companies warned they face an initial fine of Dh96,000 ($26,000) if they fail to employ one Emirati by the end of 2024.
Those that fail to employ two Emiratis by the end of 2025 will incur a penalty of Dh108,000.
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Emirati salary guide 2023
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The new rules apply to employers in 14 sectors, including property, education, construction and health care.
Previously, only companies with 50 or more staff had to take part in the Emiratisation drive, with those operating in free zones being exempt.
There has been no confirmation yet as to whether smaller companies working in free zones will also be exempt.
Nevin Lewis, chief executive of Black and Grey HR, said that the rule expansion would have “a significant impact” on private-sector companies in the Emirates.
“It offers an opportunity to tap into the local talent pool, foster diversity and contribute to the long-term socioeconomic development of the UAE,” Mr Lewis said.
“Companies that embrace this change, invest in Emiratisation initiatives, and create pathways for career advancement for Emirati nationals are likely to gain a competitive advantage in the evolving business landscape of the UAE.”
Jake El Mir, an entrepreneur who founded an eSim company that currently has fewer than 20 employees in the country, welcomed the new rule.
He believes that the requirement is practical and unlikely to drastically impact budgets.
“It will indeed create a meaningful difference in promoting Emirati involvement in the private sector,” he said.
“This move represents a balanced approach that supports local citizens without imposing significant financial burdens on businesses.
“Overall, this initiative reflects the government's commitment to empowering its citizens while maintaining a harmonious and diverse work environment,” Mr El Mir said.
Last Friday marked a deadline for private sector firms with 50 or more employees to ensure that 3 per cent of their workforce was Emirati.
The measures were introduced to encourage Emiratis to take up skilled positions in the private sector.
It was announced in February that firms would be required to increase the number of Emirati employees by one percentage point every six months.
Employers have to reach a 4 per cent target by the end of the year, increasing to 6 per cent by the close of 2024, 8 per cent the following year and 10 per cent by the end of 2026.
Karuna Agarwal, director of Future Tense HR in the UAE, said that the new rule also means that Emirati candidates will have to upskill to help add value to small companies, which usually require employees to have versatile skillsets and take on multiple roles.
"Emiratisation for SMEs is going to be a game changer for employers and also for the talent base or job seekers," she said.
"Until now we have seen a significant inflow of Emiratis in the government sector and large organisations, but now we will see them enter the SME space, which is a very competitive and high-pressure environment.
"This will also mean that the Emiratis will have to upskill and enhance their profiles and portfolios to be prepared for new sort of roles that would equip them in obtaining better job offers and adding more value in the small to mid-sized companies," Ms Agarwal said.
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