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New UAE labour decrees to help attract talent, say HR experts

New UAE labour decrees to help attract talent, say HR expertsImage Credit: Supplied

New rules issued by the UAE Ministry of Labour will raise transparency in the labour market and improve employment conditions – key to attracting new talent to the UAE, say analysts.

However, the rules might make it harder to retain employees as they ease labour mobility, they added.

On Sunday, Saqr Ghobash, the UAE's Minister of Labour, announced the new rules that are in line with the policy initiative from 2011 regarding labour mobility.

The three ministerial decrees – 764, 765, and 766 – help enforce more regulations in the labour market ''to ensure both employer and employee enter into fully voluntary relationships,'' according to a statement from the Ministry.

Nuno Gomes, information solutions leader for Middle East at Mercer Consulting, a human resources firm, said that companies operating under the Ministry of Labour regulations (as opposed to those in free zones) could face challenges in retaining talent.

''Employees will be essentially free from now on to change employers without having to receive the letter from their employer that they could start immediately in another location,'' he said.

''Retention was as easy as not letting the employee take another employment unless they left the country for six months, which made it very difficult for people to move jobs,'' he added.

Motivation booster

As per the new decrees, after a notice period, a worker does not require their employer's consent to start employment elsewhere immediately.

''In line with the [Ministry's] intention to create more clarity and consistency in the labour market, I think that's what the impact will be. The terms and conditions of employment contracts will become standardised from now on, but on the other hand, employees will have more flexibility to change employers, so that's another big impact of the rules,'' Mercer's Gomes said.

However, other analysts said that the increased flexibility in employee mobility could boost workers' relation with their employers and thus, boost motivation.

Eyhab Abdeen, partner at PricewaterhouseCoopers' (PwC) People and Organisation Consulting, said that the increased level of transparency is the highlight of the announcement, which will resonate in the labour market.

''I think that it will help organisations actually retain employees because when you create that level of transparency early on around the working conditions, and when you create boundaries on the termination of contracts … people actually stick around because they're motivated, committed, and engaged rather than being forced to stay, which is de-motivating,'' he said.


Abdeen added that there were still some challenges in the labour market, though, including workforce nationalisation, especially in the private sector; accelerating capacity building; and the hiring process, among others.

Similarly, Markus Wiesner, chief executive officer of Aon Hewitt Middle East, a global human resources consultancy, said that introducing more employee-friendly regulations will give people more confidence in working in the UAE.

''Easier movement between organisations will increase labour mobility and make it easier for employers to attract talent elsewhere. The labour market is certainly developing in the right direction, but more needs to be done to attract top talent. It will be a challenge to keep up with planned economic growth without compromising on the quality of talent,'' he said.

Wiesner added that setting up a mandatory pension system for every employee, as well as monitoring the cost of living more carefully will help make the UAE's environment more attractive for employees.

As for the outlook, Vilius Dobilaitis, finance recruiter at Morgan McKinley, an employment agency, said that oil prices remained the biggest factor impacting the job market, which has slowed down by one per cent year-on-year.

He expected to see growth in many sectors about three quarters from now.

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Source: Sarah Diaa, Staff Reporter,