If today you walk inside a boardroom in Dubai or Abu Dhabi, the discussion has totally flipped. Board members a couple of years ago were almost entirely occupied with the topic financial returns, supply chain, expansion, etc. They have been turning their discussions for the most part to people recently.
Human capital is no longer just a line item in the expense budget or a task handled quietly by HR. At UAE companies, HR is a subject that boards are discussing and it has come to their top agendas officially.
Here, we present a few things that explain why UAE businesspeople and board members put people capital at the very heart of their business strategies.
The greatest reason behind the recent change of priorities in the boardroom is the initiative for Emiratisation in the UAE. The Ministry of Human Resources and Emiratisation (MoHRE) has laid down the benchmarks that a company should hit. The private companies must have in their workforce 10% of skilled Emiratis by the end of 2026 if they have 50 or more employees.
Missing these regulations and targets is not just an HR issue. The business license renewal, the company's financial situation, as well as its reputation are directly affected. Boards are being proactive to make sure that the teams of the companies are in communication with specialized recruitment firms in UAE to locate and retain skilled local talents before the timelines come into play.
The country's legislative environment is changing so fast that a new federal law number 33 issued in the year 2021 has introduced a completely new set of rules and practices for companies. It limits the duration of probation, provides an enlarged interval for filing labor disputes, and creates guidelines for hybrid work arrangements, which are pretty complicated.
Besides that, MoHRE has started applying smart digital tools to keep track of employees' salaries and hiring procedures so that no one is wronged. It is obvious that boards have to be on top of their game in terms of compliance because even minor breaches could stop their operations and impose big financial consequences. Therefore, a growing number of executives get legal and HR professionals to review company rules, especially about labor issues, on a regular basis to make sure that they remain within permissible legal boundaries.
Previously, having a degree from an elite university guaranteed you employment. The trend now in the UAE is for organizations to value practical abilities rather than degrees.
Large local companies are now removing the degree requirement at the beginning of the job description. Instead, they look for people with professional certifications, good interpersonal skills, and the ability to learn and adapt to change. This way of recruiting employees brings about radical changes for the companies, and the executive leaders are gradually realizing that they will not have the most competent workforce if they continue to stick to old hiring methodologies that do not consider actual competencies of potential candidates.
It is projected that by 2026, Millennials and Gen Z will compose approximately 75% of the total UAE workforce. The younger generation has a different work style:
High employee attrition is one of those big costs of business that companies often underestimate. In fact, it can reach more than twice that of an employee's annual salary to replace him/her!
Therefore, in order to retain good people, employee loyalty and well-being are considered as strategic tools in the financial department!
From automated payroll to AI-powered resume filtering, technology is changing the everyday operations of a Ubusiness. Boards have to decide which technologies to invest in and identify the skills their employees need to use them effectively. Human capital strategies are now deeply aligned with IT budgets, so board members have to sanction large-scale digital transformations that directly affect the manner, time, and place workers carry out their daily jobs.
Understanding market fluctuations, legal updates, and Emiratisation deadlines in the UAE is not an easy task and demands constant attention. Nevertheless, you can share the burden. Whatever your requirement is, hiring local professionals, updating your HR practices, or outsourcing payroll functions, TASC Outsourcing is more than happy to help you out.
Leveraging our 20 years of outsourcing experience, we can help you meet legal requirements. As a one-stop solution, we give you more time to focus on your core business.
If you are a company looking for a long-term human capital strategy that is aligned with the changing dynamics of the labor market, do not hesitate to connect with us at TASC Outsourcing right now.
The reason is that talent management has now moved beyond the administrative role. Issues like Emiratisation targets, labor law revisions, turnover costs, and digitalization are affecting the company's legal status as well as its profitability.
Bang! Private companies employing 50 or more individuals must make sure that UAE national professionals account for 10% of their total workforce at the latest by 2026 with the target increasing by 2% annually.
Expert recruitment firms in UAE keep a close track on the talent situation. They can help you source candidates from a vast, ready-to-go talent database to find you a qualified Emirati or international specialist quickly and efficiently. This, in turn, helps you avoid costly wrong hiring decisions and penalties from MoHRE.
A human resource consultant assists you in ensuring that your company is compliant with UAE labor laws; devising attractive compensation packages through salary audits; designing hybrid (office and work at home) structures; and preparing managers to lead effectively.
Absolutely! Outourcing of such functions as payroll, visa procedures, and contract negotiations will save you costs, guarantee legal compliance, and release your in-house team for the work where they can add value through the core business activities.