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Wed 22 Dec 2010 01:33 PM

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Private firms may struggle to meet 15% Emirati quota

Labour law requiring private firms to have 15% national workforce will have ‘rocky’ start, recruiters say

Private firms may struggle to meet 15% Emirati quota
Private sector firms in the UAE must fill 15 percent of their workforce with Emirati staff, under Ministry of Labour laws

A labour law mandating that UAE-based companies have a workforce comprised of 15
percent Emiratis will be a struggle for private sector firms to fulfill, a top
recruiter said.

“It’s
going to be difficult,” said Konstantina Sakellariou, marketing and operations
director at Stanton Chase, Dubai, in an interview with Arabian Business. “It
will take time and companies should be prepared. It’s going to be a bit of a
rocky start.

 “The biggest challenge is to keep the
communication good – neither will see the best results at first.”

The
quota was included in a ruling issued by the Ministry of Labour on Sunday, which
also scrapped a law requiring skilled workers to secure a no-objection
certificate from their employer before taking up a new job.

Companies
will have to offer salaries that match UAE government jobs if they hope to
attract the best nationals, most of whom gravitate towards the public sector,
said Matthew Gribble, managing director at Matthew Page Midde East.

“Companies
will need to be willing to remunerate candidates [whose qualifications are] in
line with their expectations,” he said. “Government entities compete very
heavily for the best UAE national graduates, so they need to offer comparable
packages.”

“It’s
an inevitable step – Emiratis can’t be employed forever in the government
sector,” Sakellariou said. “Younger Emiratis are getting educated, and they’re
going to enter into the private sector.”

Gribble
said there was plenty of talent to fill the quota, “particularly at graduate
levels coming through the universities… there’s a good supply of well-educated
candidates that can be found for roles within any kind of organization.”

Retention
rates for Emiratis have traditionally been lower than those seen among expat workers
in the private sector. Companies will find this an ongoing hurdle, said Sakellariou.

“Retention
is a challenge in general and this is a bit difficult because the national work
force is protected – when someone has to face the challenges of the private
sector, it can be challenging,” she said, adding that cultural differences can
play a role in workplace problems.

“One
thing is to enforce the hiring – and there are many organizations trying to
bridge the gap between the Emirati workforce and the private sector. The Emirati
workforce can be very motivated if they are communicated to in the right way.
They want to develop.”

Both
Sakellariou and Gribble said they expected business from both nationals seeking
employment, and companies seeking Emirati staff to increase.

“Right
now, compared to the expat population, our database has a small percentage of
nationals,” she said, “but it grows bigger and bigger. We have dedicated
workers who focus on Emiratisation.”

 

Abu Wisam 8 years ago

In the face of stiff competition from overseas manufacturers, UAE manufacturers (especially smaller enterprises employing less than 20 employees) should be exempt from these rules, if they are to remain viable and survive. The SME sections of chambers of commerce and industry established to promote small and medium businesses should present their case to concerned authorities.

While on the subject, perhaps they should also petition that such businesses be also exempt from the WPS, especially those who have a good track record in respect of payment of wages to employees. Because all it does to such businesses is raise costs and add one more chore that they can do without.

Glory 8 years ago

Fantastic decision and should have been implemented long ago. There should be no exemption for any firm.
The focus should be on jobs for the indigenous people of a country who are currently demographically challenged, They are fighting for existence in their own country against a huge expatriate population, who, if given the chance would deny them the right to work in the private sector as employees. To listen to some employers, it is as if they have a gun at their head before they will ever take an Emirati employee. Well now the time has come for them to do just that - not all Emiratis are uneducated and lazy as many prospective employers would ague in a case for non-compliance with the ruling. The problem here is that most private firms have been using the cheapest labor they could to maximise profits. Now those profits will be eroded as they will be forced to pay higher salaries, albeit that they would be normal on a global scale.

Fozan Sheikh 8 years ago

Would Glory let us know how much higher are salaries in, for example, China? I agree totally about the exemptions.

Suresh 8 years ago

Another well intentioned law, not thought through before being announced. Any idea how a restaurant in Karama will employ an Emirati or if an Emirati will agree to work there ? There may be professions where there are no trained Emiratis available like Chefs, nurses etc. what happens then ? Part of the strategy of keeping it vague during the first announcement is to enable the authorities to back track. Another option that is almost always exercised is that there will be "relief" from the law as long as you are willing to pay a fine or a fee.

Original Joe 8 years ago

This will never happen as the government expects. The problem is "work ethic".
This is not a Emirates problem by the way. This is also a Saudi, Kuwait and Qatar problem. The governments of these countries cannot continue to support their citizens in jobs that may not be necessary or they could be done by a foreigner at 30% of the pay.

Mounir 8 years ago

What most people don't realize is that under the same new rules, the definition of what a 'local' is has also changed. Under the new rules, any GCC national is considered a local (as long as his/her salary is over 3,000 and the company contributes to the retirement fund of that specific GCC country).

Any competent Recruitment or HR Manager with at least one year experience in the UAE will realize that you can hire extremely well educated and highly experienced Omanis and Bahrainis for the same salaries that Western or Arab expats get.

What's the excuse now for not hiring them? Oh that's right.. there isn't any other than blatant discrimination.

Telcoguy 8 years ago

Have you considered that companies will simply move out? Construction and hospitality are the main industries here and the only ones who can not relocate. Will emiratis fulfill15% of the jobs in these industries?


Business Man 8 years ago

The reason for not hiring them Mounir is merit. As a business owner I will hire the best person for the job. It should be up to me who I pay a salary to. Discrimination has no role in our society.

harrywinston 8 years ago

I have no problem hiring a emirati in Abu dhabi.
However most salaries are benchmarked against the unrealistic salaries doled out in the public sector. At this rate i will have to declare bankruptcy.
On the other hand i am willing to match salaries if the government gives me a subsidy to match the difference between public and private sector, this way we all win. I hire an emirati, the emirati is happy with his pay and the government does not create a ghost job for this guy.

Kaptain 8 years ago

This country is no more a bliss and a dream for expatriates. Its not the land of opportunity anymore.