Debate over impact of Emirati job protection

Private-sector companies are more likely to employ Emiratis because of a new government policy that protects them from being laid off, a labour official said yesterday to counter claims to the contrary. Feddah Lootah, the acting director general of the National Human Resource Development and Employment Authority (Tanmia), said Emiratis would feel more secure in their jobs knowing they cannot be laid off. As a result, they will "increase their productivity, performance and loyalty". Companies will become aware of that trend and will recruit more Emiratis, she said. In contrast, some business owners and analysts have described the guidelines, announced on Wednesday by the Ministry of Labour, as "counterproductive" and "inflexible". Under the new policy, private companies may not dismiss Emiratis except in cases of serious misconduct. If a company wants to dismiss an Emirati for any reason, including financial difficulty, it must notify the ministry one month in advance. "This new law protects the national workforce of the country and, like any country in the world, the national workforce is the most valuable asset and wealth," said Mrs Lootah, whose agency is charged with the task of finding jobs for Emiratis. "Hence, all efforts made by governments are to be channelled towards achieving stability and prosperity to its people." She said the UAE would seek to protect the rights of all workers, Emirati and expatriate, from unlawful and unfair redundancies. The new policy also stipulates that underperforming Emiratis could not be sacked but must be given more training or transferred to work more suited to their skills. Paul Dyer, a research associate at the Dubai School of Government, who specialises in labour policy, said the new rules were "a worrisome precedent" that may serve as a disincentive to be productive. "This kind of legislation sends strong signals to those who are not motivated from within, that they do not have to put much effort to keep their jobs, and therefore, reinforces a cycle that already exists within private businesses of not hiring Emiratis," he said. "Hence, firms will resist much more than in the past from hiring Emiratis." Mrs Lootah said it was unfair to link low performance only to the national workforce. "There are success stories that banks are happy to share on the positive contribution of Emiratis to their organisations. It will show how committed, loyal and productive they are, and that is not only in the banking sector but also in many other industries such as retail and hospitality." Wael al Sayegh, the managing director of Al Ghaf, a human-resource consultancy, agreed. The new policy, he said, "is an excellent step forward and surprising it did not exist previously. Job security for Emiratis in their own country does not need to be justified." Mr al Sayegh, who is an Emirati, added, "In other countries where there are mature economies trade unions would step in to help. But in the absence of trade unions the Government has a right, particularly in the demographic status of the UAE." Similar policies to safeguard citizens' jobs have been introduced across the GCC. In Saudi Arabia, nationals have a right to employment, and cannot be removed from their jobs even for extraordinary misconduct, as in the UAE. Last year the Saudi labour ministry cut its hiring quota for construction workers from 10 to 5 per cent as it confronted a severe labour shortage, which has held down a construction boom. In 2007, the ministry banned 107 companies from employing foreign workers for failing to meet recruitment targets for nationals. One of the executives of a banned company told the Arab News newspaper that it was hard to meet government targets because few Saudi nationals were prepared to take entry-level or cleaning jobs. The official unemployment rates in Saudi Arabia are 9 per cent for Saudi men and 22 per cent for women. According to government figures, Saudis filled a quarter of private-sector jobs only a few years ago. shafez@thenational.ae * Additional reporting by Tala al Ramahl