In line with the federal law concerning unemployment insurance, the Emirates are continuing their efforts regarding Emiratisation measures through the NAFIS program.
“NAFIS is the result of collaboration between multiple stakeholders in the public and private sectors. Through tailored initiatives, NAFIS aims to integrate Emiratis into critical and emerging fields within the private sector.”
These Emiratisation measures apply only to private-sector companies where Emirati citizens can be counted on one hand (it should be noted that the vast majority of public-sector jobs are held by Emirati nationals).
This is why the UAE Cabinet adopted a new scheme called NAFIS. It brings together a set of measures aimed at increasing the Emiratisation rate (the percentage of Emiratis) in private-sector establishments.
What is the new Emiratisation rate for private-sector companies?
The Cabinet has imposed a minimum Emiratisation rate of 2% per year for highly skilled jobs. This measure applies only to establishments with more than 50 employees (companies with fewer than 50 employees are not affected by this measure). By 2026, the Emirates’ goal is to reach a rate of 10%. According to the Cabinet, this will create more than 12,000 employment opportunities per year for Emirati citizens across all economic sectors.
Penalties
It was clearly announced that, starting in January 2023, companies that fail to comply with these new rules will be penalized with a fine of AED 6,000/month for each vacant position that has not been filled by an Emirati citizen.
Example: If your Emirati quota is 100 and you have recruited only 70 Emiratis, you will have to pay a monthly fine of AED 180,000 = 30 (vacant positions) * AED 6,000.
What are the benefits for companies?
Massive reductions in service fees.
A reduction of no less than 80% in the service fees of the Ministry of Human Resources and Emiratisation (MOHRE) is also being considered. However, please note that this reduction will be granted only to companies that “achieve major accomplishments in terms of recruiting and training Emirati citizens.”
Considerable salary support
The NAFIS scheme provides a salary support program (of a financial nature) for Emiratis. Emirati employees in the private sector will receive salary support for one year, amounting to up to AED8,000 per month during their training. University graduates will receive monthly support of up to AED5,000 for a maximum period of five years.
Merit program
NAFIS offers certain professions, such as coders, nurses, auditors, and accountants of Emirati nationality, additional support on top of their basic salary. The Emirates wish to invest in these professions, which they consider careers of the future.
Retirement support
For Emiratis, the NAFIS program provides a five-year subsidy paid by the government on behalf of the company to cover the cost of retirement plans for Emirati staff.
Family allowances
Finally, NAFIS also offers a monthly subsidy of AED 800/child/month - limited to 4 children, for a maximum monthly amount of AED 3,200 - exclusively for Emiratis working in the private sector.
NAFIS gives every private-sector company the opportunity to join the initiative program by publishing job vacancies and training programs, while benefiting from salary support for their employees and reductions in retirement contributions.
Launched as part of the "
Projects of the 50", this program aims to accelerate the development of the UAE and stimulate the economy.
You can find more information on the
MOHRE or
NAFIS websites, or by contacting Attorney Joséphine D’Angelo by phone at +971 56 953 7401 or by email at
josephinedangelo@merritt-legal.com.
Our firm has specialized in company formation in the United Arab Emirates since 2009, and our partner Merritt Legal Consultants assists you with all matters related to employment law and business law.
Merritt Legal Consultants also works with a local law firm for all litigation procedures and can assist you with your démarches.
Please do not hesitate to contact our attorney Joséphine D’Angelo by phone at +971 56 953 7401 or by email at
josephinedangelo@merritt-legal.com .
