UAE move to align public-private sector salaries; are you affected?

The Emirates is considering changes to the existing Labour Law

Focusing on its effort to increase the number of local nationals working in the private sector, the UAE is considering changes to the existing Labour Law, which will ensure that those working in private companies will receive salaries equivalent to ones being paid by the government in similar positions.

Many Emiratis prefer to work in the public sector as some private companies have longer working hours, shorter holidays, and lower pay scales, thus increasing the pressure on government jobs.

UAE Labour Minister Saqr Ghobash is likely to present the government with a review of the current labour law shortly, it has been reported in Al Khaleej daily. The review will include proposals to bring private and public sector salaries in line, as well as increasing private sector holidays.

Experts in the recruitment industry have welcomed this news. This, they say, will reduce the pressure on the government to employ the nationals and will integrate Emiratis in the private sector, preparing the country for sustainable and long-term financial and economic growth.

“We are a private bank and we prefer hiring Emiratis whenever possible. This is keeping in mind the future needs and requirements of the country. I’m not sure whether all companies are positioned to do so but, as a bank, financially, we are better equipped to pay more,” said the HR manager of a multi-national bank in the UAE on the condition of anonymity.

However, some believe that there remain grey areas in the implementation of such a move, and that certain issues might need to be addressed to ensure this move is accepted by private companies across the board.

“The idea is to increase the number of Emiratis working in the private sector. If private companies’ salaries, working hours and holidays are aligned, it will definitely attract a lot more Emiratis to the private sector, but it might mean that private firms will need to undertake additional steps to maintain their profitability,” Konstantina Sakellariou, Partner, Marketing & Operations Director at recruitment consultancy Stanton Chase International, explained to this website.

“The private sector will try to avoid a high running cost as they operate solely on profit basis. Then, we have the free zones, and I’m not sure whether and how this law will be applied there,” she added.

Statics show that only over 11 per cent of the UAE’s estimated 8.3 million people are Emiratis and the jobless rate among citizens is put officially at 14 per cent.

The increase in salaries will be coupled with a greater number of holidays to those working in the private sector. Sheikh Mansour bin Zayed, Minister of Presidential Affairs and Deputy Prime Minister, had recently announced that the government is mulling a move to adjust the holidays, aiming to make the private sector jobs more appealing for Emiratis.

The current law of the country grants a weekly off for private sector workers whereas government employees have two days off. To be fair, however, a large number of private sector companies do offer a two-day weekend to their employees even as some do not.

Besides the weekly holidays, government employees are also allotted longer public holidays. If we calculate the holidays, many private sector employees end up working an extra 57 days a year.

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