Introduction

A recent amendment to the UAE labor law has introduced significantly increased penalties for fraudulent Emiratisation practices. Announced earlier this week, the new regulations impose fines ranging from Dh100,000 to Dh1 million for various fraudulent labor acts.

Penalties for Fake Emiratisation

The updated law targets practices where UAE nationals are issued work permits and registered with establishments without being given real work. This deceptive practice, often employed by companies to meet Emiratisation targets, involves hiring Emiratis in name only.

Key Penalties

• Fraudulent Employment: Fines ranging from Dh100,000 to Dh1 million.
• Administrative Fines:
• Dh20,000 to Dh100,000 per instance of false Emiratisation.
• Additional fines of Dh100,000 to Dh500,000 for evading Emiratisation targets.
• Evasion Tactics:
• Penalties starting from Dh100,000 for the first offence.
• Rising to Dh500,000 for repeat offences.
• Fines are multiplied based on the number of fictitious employees.

Recent Case Example

In a notable case, a private company was fined Dh10 million for failing to comply with Emiratisation regulations. The court found that the firm had appointed 113 Emiratis to non-existent roles. From mid-2022 to November 2023, the Ministry of Human Resources and Emiratisation (Mohre) identified 1,267 Emiratis employed in fake positions.

Additional Amendments

The labor law amendments also address other significant issues, including:

• Business Closure: Penalties for closing a business without settling workers’ rights.
• Employment of Minors: Strict regulations concerning the employment of individuals below the legal age.

Dispute Resolution

For disputes between employees and employers, the following procedures are established:

• Submission: Disputes should be submitted to Mohre.
• Final Decision: The ministry’s decision is final.
• Legal Challenge: Parties retain the right to challenge the decision before the relevant Court of First Instance within 15 days.

Conclusion

The new labor law amendments aim to crack down on unfair and deceptive employment practices and enforce stricter compliance with Emiratisation policies. These measures are designed to ensure that Emiratisation targets are genuinely met and to protect the rights of workers.

 

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