If private sector enterprises in the UAE satisfy certain requirements and surpass government-mandated Emiratisation rates, they will receive discounts of up to 93% on ministry costs.

On Tuesday, the Ministry of Human Resources and Emiratisation introduced a new classification system for the commercial sector. The new structure, which takes effect on June 1, divides businesses into three categories. Firms with the highest rating will receive significant discounts on fees, while those with the lowest will be required to pay all fees in full.

Discounts are available on a variety of services, including two-year work permits and contract renewals.

Emiratisation, ethnic variety of personnel, and commitment to labor standards are among the requirements, according to Dr Abdulrahman Al Awar, Minister of Human Resources and Emiratisation.

The categories under which the discounts have been classified are as follow:

Category 1:

According to a new UAE Cabinet resolution, private sector enterprises must increase their Emiratisation rates by 2% annually. Companies who meet or surpass this criterion will receive a “first rating,” which will help them acquire the best discounts.

“Instead of a cost of up to Dh 3,450, such enterprises will pay only Dh250,” Al Awar added.

Firms will receive this rating if they observe all labor laws and agree to the Wage Protection System, as well as meet one or more of the following criteria:

Private sector companies in the UAE will get discounts of up to 93 per cent on ministry fees if they exceed government-mandated Emiratisation rates and meet some other criteria.

1. Increasing the annual Emiratisation rate by at least three times the current aim of 2%.
2. Collaborating with the Emirati Talent Competitiveness Program Nafis to hire and train at least 500 Emiratis each year.
3. Is categorized as a small or medium-sized business.

Category 2

This rating is given to private establishments that respect all UAE labor rules and regulations but do not meet the other criteria.

“They’ll also get discounts and have to pay Dh1,200 in fees.” Their discount rate will be lower than that of the first group of enterprises,” Al Awar noted.

Category 3

This rating is given to businesses who disobey rules or do not follow labor laws.

“These businesses would be required to pay all fees in full,” the minister stated.

A workforce that is culturally diverse

According to Al Awar, Private enterprises will gain from the reductions by hiring personnel from varied backgrounds to guarantee a balanced cultural environment at work.

“Private enterprises that hire a maximum of 20% personnel from a single nationality will achieve the cultural diversity criteria,” Al Awar added.

“Not only will this assist enterprises in receiving savings on ministry service costs, but it will also offer them greater freedom in attracting personnel.”

Emiratisation Goals

The UAE Cabinet had already approved raising Emiratisation charges for private companies to 2% each year. By 2026, the goal is to raise this percentage to 10%. This would result in over 12,000 job possibilities for residents across all economic sectors each year.

Non-compliant businesses will have to pay Dh 6,000 per month for each citizen who is unemployed starting in January 2023.

How will the businesses be classified?

A new electronic system has been installed after months of development. The ratings will be based on information provided by ministry inspectors.

“The smart technology will handle the entire rating procedure once our inspectors provide feedback based on their visits to venues,” Al Awar stated.