SHARJAH, 6 January 2005 — Insurance companies in the UAE have been warned that they would not be granted fresh employment visas and the work permits of their existing foreign staff would not be renewed until and unless they meet a government directive that 15 percent of their staff should be UAE nationals and there should be an annual five percent increase in their number.
The deadline for meeting the 15 percent demand, contained in a Cabinet order, ended on Dec. 31, 2003, and, according to Abdul Rahman Al-Awar, director-general of the National Human Resource Development and Employment Authority (Tanmia), the insurance companies had not complied with it, which is part of the government’s Emiratization policy.
Minister of Labor and Social Affairs Dr. Ali bin Abdullah Al-Ka’abi has issued a warning that any company found not to be complying with the Emiratization guidelines would face punitive action. According to Awar, there are 47 national and foreign insurance companies in the UAE and only one has complied with the Emiratization requirement. Even at that, he said, only 15 percent of employees of this company are nationals even though this percentage should have increased to 20 by the end of 2004. Three of the 47 companies have 10 percent nationals and the rest have much lower rates, said Awar.
The overall rate was 5.3 percent in 2001 and it has not gone up at all, said Awar.
The companies which have not met the requirement “will not be granted work permits by the Ministry of Labor and Social Affairs, nor will they be allowed to renew their existing work permits until they amend their status and employ the required percentage of nationals,” said Awar in comments carried in the local press.
The insurance companies say that they are willing to meet the Emiratization requirement, but UAE nationals need more qualifications and training to work in the sector. They say that only a handful of nationals have the expertise to work in the insurance sector. Furthermore, they say, training anyone to work in the insurance sector is a difficult and time-consuming task. At the same time, there are enough expatriates who have been trained and have the expertise and who are willing to work long hours and for a smaller salary than a national.
The government has ordered all commercial banks in the country to ensure that a minimum growth of four percent is recorded every year in the number of UAE nationals employed by them and to achieve the target of 50 percent Emiratization of jobs in the banking sector by the year 2007. A study conducted last year by the Emirates Institute for Banking and Financial Studies (EIBFS) has found that there was a sharp decline in the rate of Emiratization of the banking workforce in the country despite standing guidelines from the government.
The study found that 27 banks — 12 national and 15 foreign — have lagged behind in the stipulated four percent annual increase in Emiratization. As of January 2004, the number of local nationals employed in the banking sector represented 25.56 percent of the total workforce in the sector. A government decree issued in 1998 had called for at least 28 percent by the end of 2003 and 50 percent by 2007.
