United Arab Emirates: New Instructions for Employers to Calculate Work Permit Quota Allocation in Mainland
July 1, 2022
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At a Glance
- Effective immediately, employers are required to use new instructions issued by the Ministry of Human Resources and Emiratization (MOHRE) to calculate work permit quota allocation.
- Previously, the conditions for the work permit quota allocation in mainland United Arab Emirates were broad, whereas now the work permit allocation depends on conditions such as whether the business has been registered in the United Arab Emirates before or after April 15, 2022; the nature of employers’ business activities; and the employers’ compliance with all applicable UAE labor regulations.
- As a result of these new instructions, employers in mainland United Arab Emirates must revisit their work permit quota requirements and ensure that recruitment of employees is aligned with the quota availability.
The situation
New instructions related to the calculation of work permit quota allocation in mainland United Arab Emirates now depend on conditions such as whether the business has been registered in the United Arab Emirates before or after April 15, 2022; the nature of employers’ business activities; and employers’ compliance with all applicable UAE labor regulations.
A closer look
- New list of business activities. MOHRE has created a list of 172 business activities in various industry sectors that are considered higher priority to the economy, including military equipment manufacturing; banking services; insurance services; healthcare services; oil and gas extraction; and education. There is an additional high-priority list of 35 activities in other economic sectors, including: restaurants; department stores; fresh food trade; delivery services; landscaping services; and installation and maintenance of electromechanical equipment. Businesses engaging in any of the listed activities will be prioritized when calculating work permit quota allocation.
- Business registered before April 15, 2022. Businesses that comply with labour laws that are registered in the United Arab Emirates before April 15, 2022 may obtain a work permit quota for up to 5-10% of their total workforce, but no more than 100 new employees. Additionally, businesses conducting any of the 172 activities from the new list will be automatically allocated a work permit quota that equates up to 50% of their total workforce.
- Businesses registered after April 15, 2022. Businesses that comply with labour laws that registered in the United Arab Emirates after April 15, 2022 may obtain a work permit quota for up to three employees, unless activities are related to certain high-priority activity lists.
- Grey areas. The MOHRE has not released information on whether new work permit quota allocations will be standardized for all types of businesses, or if employers registered in the United Arab Emirates prior to April 15, 2022 engaging in non-priority activities will need to request approval from MOHRE. Furthermore, authorities have not confirmed if the approval process will include government inspections or associated document requirements.
Impact
The new instructions will require employers in mainland United Arab Emirates to reassess their current work permit quota requirements to ensure that they are prepared for future compliance audits.
Background
Previously, the work permit quota allocation was not transparent, and it relied heavily on employer justification and adjudication of requests, on a case-by-case basis, on factors such as sufficient office space, among other criteria.
Looking ahead
The government of United Arab Emirates is likely to continue to introduce measures to ensure that employers have adequate guidance on UAE labor laws.
This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].
