The UAE has tightened rules on recruitment agencies and issued a ministerial resolution on the regulation of such agencies. As per the new resolution, recruitment agencies must not receive any cash or commission from workers and must provide acknowledgement of compliance to the Ministry of Human Resources and Emiratisation (MOHRE).
The resolution also prohibits recruitment agencies from employing minors, who are not eligible to work under applicable laws in the UAE issued by MOHRE.
The resolution also set a range of obligations for agencies covering mediation, temporary employment and outsourcing, as well as the obligations of beneficiaries.
The activities of intermediation, temporary recruitment and employment outsourcing schemes are now regulated by the Executive Regulations, and are defined as follows:
Intermediation: Acting as an intermediary between the parties to an employment contract, including negotiating the terms of the contract with a view of establishing an employment relationship without the intermediation agency becoming a party.
Temporary recruitment and outsourcing: Making employees of the temporary recruitment and outsourcing agency available to third parties. The employment relationship remains with the agency and not the third party (i.e. the beneficiary).
Agency: Any individual or entity engaged in the activities above.
Beneficiary: An individual or entity to whom an employee is assigned and under whose supervision the employee works pursuant to a temporary recruitment and outsourcing contract. This arrangement can either be for a specific period of time or a specific task or service.
Recruitment agencies must draft accurate contracts complying with the UAE law and keep records of workers for at least two years.
They should also cover the costs of repatriating workers, and pay for damages if proven that the agency failed to comply with the terms of the agreement with the employer.
Manpower agencies are not allowed to assign a worker any job or service outside the general framework of their agreed duties.
They are also prohibited from letting workers work for more hours than the total agreed working hours, except overtime provisions are provided.
Manpower agencies are obligated to provide workers with written instructions on their required duties, under the general framework agreed with the agency.
In the case of agency licenses, recruitment agencies may open branches in the licensing emirate or any other emirate, according to the requirements of local regulatory authorities.
The Executive Regulations set out the conditions that must be met by a company or individual wishing to obtain a license (renewed annually) to carry out any of the activities above. These conditions include:
Providing the Ministry with a bank guarantee of not less than AED 300,000 (c. USD 81,677) in respect of an intermediation agency license.
Providing the Ministry with a bank guarantee of not less than AED 1,000,000 (c. USD 272,257) in respect of a temporary recruitment and outsourcing license or where an applicant applies for both activities.
Submitting a credit report to the Ministry.
A company licensed to carry out any of the activities listed above is responsible for complying with the provisions of the New Law and the Executive Regulations in respect of their employees who are outsourced to a beneficiary.
Agents must not supply employees to any entity which has been suspended by MOHRE and must inform MOHRE should they become aware of any breach of workers’ rights by an entity to whom they have supplied employees.
