Month: September 2020
Oman sets minimum wage for Omani National
HLB Oman Payroll Team
Phone:- +971 4 327 7775
Mobile:- +971 50 205 9540
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
Oman has decided to set the minimum wage of all Omani national employees to 325 Omani riyals, irrespective of their educational qualification. It was Nasr Al Hosni, undersecretary of Oman’s Ministry of Labour, who announced the landmark move to de-link the minimum wage requirement to academic qualifications. The decision is part of the Fiscal Balance Programme of 2020-2024 plan (Tawazon).
Initially, the salary was not fixed and was paid as per the qualifications of the employees. Oman government has increased the quality of living of its people by raising the minimum wages to 325 riyals.
The Ministry of Labour has been initiating many plans to improve job opportunities for the citizens in the government and private sectors. In order to provide jobs for Omanis, they have discontinued the sub-contracting of expatriate employees.
A meeting was held by Mr.Al Hosni, where more than 30 human resources officials had taken part and has promised to lend their support in providing necessary job-training and skill-transfer to the Omani cadres. The meeting focused on replacing the expatriates with the citizens of Oman in various industries.
Recently, several organizations offered vacancies in government offices including the health sector for Omani candidates. The Ministry of Labour is focusing on starting Omanisation in organizations through regular meetings with the private sectors to provide job opportunities for Omanis.
Oman has come up with a steady plan to provide job opportunities for its citizens, which can be adopted by other countries too. “Omanisation” will bring growth in the economic status of the country as well as the citizens. The government aims to provide a better living condition to its citizens by raising the minimum wage and through Omanisation.
Read our blog on Oman gratuity policy.
To know more about our payroll process, Click here
Disclaimer:
Whilst every effort has been made to ensure the accuracy of this information, HLB HAMT will not accept any liability arising out of errors or omissions. Please note that this blog is not all-inclusive. Our guidance is designed only to give general information on the issues/topics covered. It is subjected to change and not intended to be a comprehensive summary of all laws which may be applicable to your situation, treat exhaustively the subjects covered, provide legal advice, or render a legal opinion.
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Payroll Process in UAE:- A brief overview
Sajin Rasheed, Director
Phone:- +971 4 327 7775
Mobile:- +971 50 205 9540
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
Payroll calculations require time, dedication, and knowledge; even a minor error can cause huge loss. Ensuring all the employees within an organization get paid the correct amount at the correct time with deductions/ allowances if any, is mandatory. It is equally important to comply with all the payroll rules and regulations. Here, our payroll experts in UAE takes you through a set of frequently asked questions that pertain to payroll processing in UAE.
What are the statutory pay components included in employee salary?
The UAE labor law does not define the components that should make up an employee’s salary; there are no defined statutory components.
Which are the common pay components that are normally payable to employees?
Fixed components may include Basic salary, House rent allowance, transport allowance and other allowances. The variable components may include Overtime, Sales commission, Bonus, Incentives, Relocation allowances, Mobile allowances etc.
What is the minimum salary payable in UAE?
There is no minimum salary payable in UAE.
How is overtime calculated?
Overtime is any extra hours worked by an employee beyond the normal working hours. Article 19 states that the employee shall be entitled to remuneration equal to his Basic Wage plus an extra of at least 25% for extra hours beyond normal working hours. If the overtime falls between 9 p.m. to 4 a.m. on a working day, the employee will be entitled to his Basic Wage plus an extra 50%. If the employee works on a designated rest day, he is entitled to a Basic Wage plus 50%. Overtime may not exceed two hours per day unless otherwise permitted.
How is UAE gratuity accrued?
UAE Gratuity is accrued against the last drawn basic salary and calculated as follows;
- Twenty-one days’ pay for every year of the first five years of service.
- Thirty days pay for every additional year.
Provided that the entire total remuneration shall not exceed two year’s pay. Days of absence from work without pay are not included in computing the period of service.
Dubai International Financial Center introduced a plan called DIFC Dews where the employer makes a monthly contribution of the employee’s gratuity accrual to a direct plan authorized to manage the funds on behalf of employees.
Read more about DIFC DEWS hereWhen is gratuity paid to an employee?
According to Article 132 of the UAE labor law, the employee who has completed one year or more in the continuous service, is entitled to the end of service remuneration at the end of his service. For a comprehensive understanding of UAE gratuity accrual and settlement, please refer to our article on UAE gratuity policy and settlement.
What are the statutory deductions that are made to employees in the UAE?
In the UAE, payroll is not subject to income tax, and hence there are no mandated tax deductions. However, UAE nationals are subject to mandatory national pension plans contributions.
How is UAE pension calculated?
Monthly pension deductions are made on UAE nationals’ total fixed salaries to a maximum limit of AED 50,000/-. Private sector employees in Dubai contribute 5% of their total salary to this plan, the employer contributes 12.5%, and the government contributes 2.5%. In Abu Dhabi, the employees contribute 5% and the employer contributes 15%.
What is UAE WPS?
UAE WPS is an electronic salary transfer system that allows institutions and organizations in the private sector to pay their employees through banks, exchange bureaus and financial institutions approved by the UAE Central Bank. The purpose of WPS is to ensure wages are paid on time and in full. The initial objective was to protect the rights and interests of blue-collar workers but has transformed to require all salaries paid in the private sector under the jurisdiction of the Ministry of Human Resources and Emiratization (MOHRE) and Economic Free zones to be remitted via WPS. Currently, Jebel Ali Free Zone Authority (JAFZA) is the only free zone that has fully adopted the use of WPS. All government entities and public sector institutions are exempted from WPS compliance.
Please read our detailed article on UAE WPS for more information.
What are the types of Employment contracts available in UAE?
All the Employment contract is prepared for specific term not exceeding (3) three years and it is permissible, by agreement of both parties, to extend or renew this contract for another similar term or for a shorter term, for once or more.
Are Employees eligible for Air Ticket Benefits in UAE?
Employers are required to provide their employees with a return air ticket once in every two years to their home country. However, many companies provide air tickets to employees annually and some of the companies extend this payout to employees’ dependents as well.
What is the leave policy defined under the labor law?
A. Annual Leave
According to article 75 of the UAE labor law, annual leave is granted for 30 days per year, where the worker’s period of service is more than one year. Annual leave is based on calendar days and any public holidays and weekends that fall within are included in its determination. Annual leave is granted to all employees and is a paid type of leave.
B. Sick leave
According to article 83, a worker shall not be entitled to any paid sick leave during the probationary period. A worker who contracts illness following the probationary period, in the continuous service of an employer shall be entitled to a sick leave not exceeding 90 days, successive or otherwise, in respect of each year of service, to be calculated as follows-
- The first 15 days: with full pay
- The next 30 days: with half pay
- Next 45 Days: Without pay
C. Maternity leave
A female employee working in UAE shall be entitled to maternity leave as given below.- 60 days out of which 45 days at full pay and 15 days at half pay for a female employee
- After completion of the 60 days paid leave, a female employee is entitled to take unpaid maternity leave for a maximum period of 45 days. This leave can be continuous or taken in non-consecutive days.
E. Study Leave
An employee, who is studying in one of the UAE’s certified educational institutions is entitled to a paid leave of 10 days per year to sit for examinations. To apply for this leave must have completed at least two years of service with the employer.
F. Bereavement Leave
In case of death of the husband or wife 5 days are entitled to the employee starting from the date of death and in case of the mother, father, son, brother, sister, grandson, grandfather or grandmother 3 days are entitled to the employee starting from the date of death.
G. Sabbatical Leave
The national worker shall be entitled to a sabbatical paid leave to perform the national service, in accordance with the legislation in force in the state.
H. Paternity Leave
A Parental leave for a period of (5) five working days is entitled for the employee (either the father or the mother), who has a newly born child, in order to take care of his/ her child and the employee is entitled to such leave for a continuous or intermittent period, within (6) six months from the date of the child’s birth.
Please read our article on UAE leave policy hereIs employee Medical Insurance mandatory in UAE?
It is mandatory that an employer provide medical insurance to the employee during the duration of employment. Some companies are extending this coverage to employee’s dependents even though this is not mandatory.
Which are the currencies that can be used in making salary payments in UAE?
The salaries shall be paid in UAE Dirham or any another currency which is agreed upon between both parties in the employment contract.
Is bonus or incentive payment mandatory in UAE?
Bonus and incentives payments are not mandatory in UAE. Many companies in the UAE have bonus or incentive schemes implemented to keep employee motivation and the structures vary from one company to the other based on their policy.
What are the items included in the End of Service Benefits calculation in UAE?
The employee is entitled to the following end-of-service benefits.
- Gratuity
- Repatriation ticket if applicable
- Notice period pay if applicable
- Any unutilized leave (Vacation) pay
- Any other outstanding payment or deduction
Summary of Employee Benefits in UAE:
- Salary
- Gratuity
- Air Ticket
- Annual Leave
- Sick leave
- Maternity Leave
- Paternity Leave
- Bereavement Leave
- Study Leave
- Sabbatical Leave
- Medical Insurance
- Overtime pay if applicable.
The process of payroll is little complicated and time-consuming; hence it is always recommended to outsource your company’s payroll function. Outsourcing payroll will ensure the assistance of a team of trained payroll professionals and it frees up the time of the organization, helping them focus on other projects that add value to their business.
One should be extra vigilant while selecting their payroll provider, as payroll data is highly sensitive, and one should opt for a provider that can ensure high levels of data security.
As a leading payroll outsourcing company in UAE, HLB HAMT can help solve your payroll complexities through customized strategies. We take care of our client’s entire payroll cycle that includes the preparation of payroll reports, processing salary payment with WPS compliance, accrual management including Gratuity, pension funds, online portal for accessing payslips, and many more. Our leadership team spends necessary hours in every project, ensuring our clients get refined consulting services to take your business forward.
Disclaimer:
Whilst every effort has been made to ensure the accuracy of this information, HLB HAMT will not accept any liability arising out of errors or omissions. Please note that this blog is not all-inclusive. Our guidance is designed only to give general information on the issues/topics covered. It is subjected to change and not intended to be a comprehensive summary of all laws which may be applicable to your situation, treat exhaustively the subjects covered, provide legal advice, or render a legal opinion.
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All about End of services Gratuity in Oman
HLB Oman Payroll Team
Phone:- +971 4 327 7775
Mobile:- +971 50 205 9540
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
Article 39 of the Labor Law (Royal Decree 35 of 2003) states as follows regarding Gratuity;
On the termination of the relation of work of the workers who are not beneficiaries of the Social Insurance Law, the employer shall pay the worker a post-service gratuity in the amount of the wage of fifteen days for each year of service for the first three years, and the wage of one month for each of the following years. The worker shall be entitled to the gratuity for a fraction of the year proportionate to the period of his service and the last basic wage of the worker shall be considered the basis for the calculation of the gratuity.
The continuous period of service, which commenced prior to the enforcement of this law shall be included in the period of service which is considered for determining the period for which gratuity is payable.
The said gratuity shall not be payable if the duration of service is less than one year.
Gratuity is the payment of a lump sum amount of money to the employee by the employer for their service. The end of service gratuity calculation depends on numerous factors, such as the length of service and how the salary is structured.
Our payroll experts at HLB HAMT, explain a few frequently asked questions on gratuity and its calculation.
What is Gratuity?
Gratuity is a monetary payment eligible to an employee as a lump sum at the end of his tenure provided that the period of service exceeds one year. Gratuity payment is a liability to the employer which accrues as the employee service period progresses.
Who can receive end-of-service benefits?
The gratuity provision in Oman is applicable to expatriate employees only. Regardless of whether short-term, Fixed-term, Long-term contracts or indefinite ones, employees in Oman are entitled to receive their end-of-service benefits. Social security law applies to Omani nationals employed in the Sultanate of Oman.
When does an employee become eligible for his/her gratuity payment?
Employees are eligible for gratuity pay at the end of their service period, at termination, death or while resigning. According to article 39, the worker shall be entitled to a fraction of the year worked provided he has completed more than one year of continuous service.
What is the basic amount that is used to calculate gratuity?
The Last drawn basic wage shall be considered the basis for the calculation of the gratuity.
What is the number of days used to accrue gratuity?
- Below 3 years at 15 Days per Year
- Three years and above one month (30 Days) per year
The following example shows the gratuity accrual at a given time.
Service period Less than 3 years 3 Years and Above Hire date 15/04/18 18/04/15 Basic salary 500.000 500.000 One day Basic salary (Basic salary/30) 16.667 16.667 Payroll Month January – 2020 January -2020 Number of days in service as of 31 January 2020 657 1750 Number of years in service 1.80 4.79 Gratuity Days For the first three years (15 days per year) 27.00 45 Three years and above (30 days per Year) NA 53.84 Total Gratuity Days 27.00 98.84 Gratuity Amount (Gratuity days*One day Salary) 450.000 1,647.260 Does type of Termination of an employment contract make any difference in gratuity payment?
Termination of an employment contract can be in terms of Resignation, Death, Non-renewal of the contract or termination by the employer. In all these cases, the employer is bound to pay end-of-service benefits. If employee is terminated as per Article 40, Employer is not liable to pay any Gratuity to the employee.
What is the effect of unpaid leave taken during the period of service?
Any period taken by the employee as unpaid leave is excluded when determining the service period. That means unpaid leave days are excluded when accruing gratuity. The period of service is reduced by the number of days served as unpaid leave.
Is there any exception for Gratuity payment while calculating final settlement of an employee?
As per Article 40 of Oman labor law, employer may dismiss the worker without end-of-service gratuity in any of the following cases:
- If he assumes a false identity, or if he resorts to forgery to obtain the employment.
- If he commits a mistake which results in a heavy financial loss to the employer provided that the latter should notify the relevant directorate of the incident within three days from the date of his knowledge of its occurrence.
- If he in spite of being notified in writing does not comply with such instructions the compliance with which is necessary for the safety of workers or the workplace, provided that such instructions shall be written and hanged in a conspicuous place and the contravention of which is likely to cause a grievous damage to the work place or to the workers;
- If he absents himself from his work for more than ten days without reasonable cause during one year or for more than seven consecutive days provided that such dismissal shall be preceded by a written notice to him from the employer after his absence for five days in the first case;
- If he discloses any secrets relation to the establishment in which he works.
- If a final judgement is entered against him for an offence or felony for breach of honor or trust or for a felony committed in the workplace or during the course of his work.
- If he is found during the working hours in a state of drunkenness or was under the influence of an intoxication drug or mental stimulus.
- If he commits an assault on the employer or the responsible manager or if he commits a grievous assault on any of his superiors in the course of the work, or because of it if he assaults one of his colleagues in the work place by hitting him and as a consequence thereof sickness or delay from the work for a period exceeding ten days ensues.
How Gratuity is calculated during final settlement?
Total Service period Gratuity calculation Less than 1 Year No Gratuity 1 to less than 3 years 15 days basic salary for each year of service 3 years or more 15 days each for the first 3 years and One-month basic salary for each year of service thereafter
Please see the below example for a better understandingService period Less than 1 Year 1 to Less than 3 Years 3 Years and Above Hire date 24/02/19 15/04/18 18/04/15 Last Working Day 25/01/20 25/01/20 25/01/20 Basic salary 500.000 500.000 500.000 One day Basic salary (= Basic salary/30) 16.667 16.667 16.667 Number of days in service 336 651 1744 Number of years in service 0.92 1.78 4.78 Gratuity Days For the first three years (15 days per year) 0.00 26.75 45 Three years and above (30 days per Year) Not Applicable Not Applicable 53.34 Total Gratuity Days 0.00 26.75 98.34 Gratuity Amount (Gratuity days*One day Salary) 0.000 445.890 1,639.041
For information on the payroll process in Oman click on this link
Disclaimer:
Whilst every effort has been made to ensure the accuracy of this information, HLB HAMT will not accept any liability arising out of errors or omissions. Please note that this blog is not all-inclusive. Our guidance is designed only to give general information on the issues/topics covered. It is subjected to change and not intended to be a comprehensive summary of all laws which may be applicable to your situation, treat exhaustively the subjects covered, provide legal advice, or render a legal opinion.
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Qatar raises minimum wages and lifts the “Kafala” system
HLB Qatar Payroll Team
Phone:- +971 4 327 7775
Mobile:- +971 50 205 9540
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
Law No. 17 of 2020 on the Non-discriminatory Minimum Wage and Removing the No-Objection Certificate was published in Qatar’s Official Gazette on 9 September and will come into effect 30 days after its publication, on Friday 9 October 2020. The publication of the law followed an announcement about the reforms issued by the Ministry of Administrative Development, Labour and Social Affairs on 30 August.
The new minimum wage of 1,000 Qatari riyals will be applicable to all workers. According to the scheme, companies should provide food and accommodation or a combined stipend of 800 riyals.
Initially, the permission from employers was mandatory to switch jobs in Qatar, but it won’t be so from now on. The removal of the “kafala” system, where the migrant worker’s visas were linked to the employer will come into action immediately and the workers will no longer require permission of the employers to change jobs.
Qatar being the host of the 2022 FIFA World cup, changes their labour reforms as a step against the accusations about migrant workers being exploited.
Labour ministry assistant undersecretary Mohammed Hassan Al-Obaidly, said that “the amendment is a huge step towards labour reforms and were made with the best interest of Qatar and its guest workers and employers.”. He also made it a point that the companies that fail to pay wages and provide necessary facilities will face severe penalties under the reforms.
The United Nation’s labour agency praised the government on their decision and said that the reforms will bring more freedom and protection to the workers and employers more choice.
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UAE Government grants paternal leave to private sector employees
HLB UAE Payroll Team
Phone:- +971 4 327 7775
Mobile:- +971 50 205 9540
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
United Arab Emirates (UAE) to grant 5 days paternal leave to private sector employees. It was President His Highness Sheikh Khalifa Bin Zayed Al Nahyan who approved the amendments made to the Federal law in August 2020.
The private sector employees shall be entitled to five-day paid leave to take care of their infants and this has to be availed within the first 6 months of the baby’s birth. The paternity leave has been granted to support gender balance and also to maintain family stability of the employees.
The new rule encourages young talents to seek employment in the private sector, which offers a series of other benefits as well. It aims to create a competitive model for the world and to support the gender balance-legislation. This step also focuses on harmonising with the upcoming plans to prepare the nation for the next 50 years and also to promote the work environment of the private sectors.
UAE government emphasizes on the importance of family and relations, which is evident from this latest initiative.
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Amendments to the Economic Substance Regulations in UAE
Jay Krishnan, Partner
Phone:- +971 4 327 7775
Mobile:- +971 50 677 5860
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
There have been certain changes to the rules and regulations pertaining to economic substance regulations in the UAE. The UAE Cabinet of Ministers issued Cabinet Resolution No. 57 of 2020 that includes a set of amended regulations and all licensees in the UAE are required to re-assess their current ESR classifications and align them according to the latest regulations.
All licensees who engage in a relevant activity must re-file notifications that were filed for FY 19 via the MoF’s dedicated portal. The uploading of ESR reports will have to be done using the same portal within 12 months, following the end of the licensee’s financial year-end.
We have listed below a summary of the major amendments to ESR regulations in UAE;
| # | Particulars | Old ESR | New ESR |
| 1 | Definition of Licensee | A natural or judicial person licensed to carry out a relevant activity. | The definition of a “licensee” has been amended to mean juridical persons and unincorporated partnerships registered in the state, including a free zone and financial free zone that carry out a relevant activity. On the other hand, natural persons, sole proprietors, trusts and foundations are not in scope of the ESR anymore. |
| 2 | Exempted licensees | Only entities with at least 51 percent direct or indirect government ownership. | Earlier only entities with 51% or more direct/indirect government ownership were exempted from ESR. But now, along with them, the following categories of licensees will be exempted from ESR;
|
| Even though these licenses are exempted from ESR, it is mandatory to file ESR notification along with sufficient evidence claiming the exemption. | |||
| 3 | Definition of “Connected person” and “group” | Connected person: – A natural or juridical person who is related to one or more juridical person(s) through direct or indirect ownership or control, or common control | An entity that is part of the same group as the licensee or exempted licensee |
| Group: – Not defined | Two or more entities related through ownership or control such that they are required to prepare consolidated financial statements for financial reporting purposes under the accounting standards applicable. | ||
| 4 | “Distribution Business” definition | Purchasing from a foreign connected person and importing and storing in the state: component parts or materials for goods; or goods ready for sale, and reselling such component parts, materials or goods outside the state. | A center that involves in any of the following businesses;
|
| 5 | “Holding company business” definition |
| It is a business that;
|
| 6 | Service Centre business definition | Providing services to foreign connected persons in connection with a business outside the State | Providing services to foreign connected persons |
| 7 | High-Risk IP Business definition | A High-Risk IP Licensee is defined under Article 1 of the Economic Substance Regulations as a Licensee which carries on an Intellectual Property Business, and under condition (a) of the definition meets all of the following three requirements:
| Is a licensee which carries on an intellectual property business and the licensee
|
| 8 | Relevant income | Not defined | All gross income from a relevant activity that is recorded in the books and records of the licensee or the exempted licensee under the accounting standards applicable thereto. |
| 9 | Penalties |
|
|
Clarification on branches
UAE branch of a UAE company
Single notification/ report to be filed
Foreign branch of a UAE company
Not relevant to ESR for relevant activities undertaken by foreign branches, if income of such foreign branches are taxed abroad.
UAE branch of a foreign company
Not subject to ESR if income of the UAE branch is subject to tax in the foreign parent jurisdiction (reported in the tax return of the foreign parent regardless of exemption)
Compliance during liquidation
Licensees carrying out relevant activities must fulfill ESR compliance requirements even if they are undergoing liquidation.
Amendments in the contents of the ESR notification/ report
Licensees who engage in a relevant activity must give details regarding the jurisdiction in which the Parent Company, Ultimate Parent Company, and Ultimate Beneficial Owner claim to be tax residents, in their notifications/ reports. They are also required to submit a copy of the financial statements along with the economic substance reports.
Notification timeline
One will have to file notification within six (6) months after the financial year-end, via the MoF’s portal.
HLB HAMT has been assisting clients to comply with ESR regulations and we will be happy to guide them on the new amendments and steps to proceed further.
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Post Pandemic Readiness: Five strategic priorities to succeed in the new world
HLB Global
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Email:- dubai@hlbhamt.com
To increase post-pandemic readiness and win in the new world, HLB International have identified five strategic priorities to unlock business transformation. Read to know more.
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5 Year Retirement Visa in the UAE
Jay Krishan, Partner
Phone:- +971 4 327 7775
Mobile:- +971 55 160 1291
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
The Dubai government has introduced “Retire in Dubai”, a scheme that gives expats an opportunity to apply for retirement visa. Residents aged 55 and above can make use of this visa to continue their stay in the emirate and the visa can be renewed every 5 years.
To be able to apply for retirement visa in the UAE, retirees must fulfill one among the below three financial requirements;
- Earn AED 20,000 monthly
- Have AED 1 million in savings
- Own a property in Dubai worth AED 2 million
Apart from these, a valid UAE health insurance is also a must to avail the scheme.
A retired expatriate and their spouse can apply for the visa and they will have to meet the minimum criteria not just the first time, but at the time of renewal as well.
Dubai Tourism is collaborating with the General Directorate of Residency and Foreign Affairs to develop the program. According to Helal Saeed Al-Marri, Dubai Tourism’s director general, the initiative has been introduced to “further enhance Dubai’s position as an iconic global city and make it the world’s most preferred lifestyle destination. The retirement programme will contribute towards our tourism economy by facilitating frequent visits from families and friends of the retirees and increasing visitation from markets with a high retiree population,” he said.
The initiative is expected to yield positive results for the economy of Dubai. Sectors that include real estate, retail, tourism, healthcare, hospitality, entertainment and finance are likely to benefit from the introduction of retirement visa in Dubai.
“5 year retirement visa is a novel approach initiated by the government of UAE that will permit expats to continue their stay in the emirate. They need not go back to their home country, which will be beneficial not just for the individual, but the economy as well. Many of the expats who work in Dubai, have spent a significant portion of their lives here and has got used to the high quality of life the city provides. Hence, an opportunity to stay back here will be welcomed whole-heartedly”, says Jay Krishnan, Partner at HLB HAMT.
Dubai has been taking numerous steps to improve the lives of expats residing in the emirate. The comfortable & luxurious lifestyle coupled with excellent infrastructure is one among the many factors that attracts residents and expats alike to this ‘safe haven’.
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The Acid Test: Customer satisfaction surveys reveal how your employees are doing in UAE
Jagdish .G, Senior Consultant
Phone:- +971 4 327 7775
Mobile:- +971 55 807 4568
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
Sir Richard Branson has famously said “Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients”.
Leading management consultants today are articulating the same thought differently. They say that if you want to really know how your people are doing – Conduct a customer satisfaction survey.
The Customer Satisfaction – Business Performance dynamic is so self-evident, no expert- speak is necessary. If still bent upon having some proof, just review recent histories of a few companies. Companies that have fallen on bad times will be suffering from low esteem in their customer circle; successful organizations will be enjoying a high score in customer approval. Given the multi-benefits it can deliver, a brief discussion about customer satisfaction survey would be interesting.
Writing in the Harvard Business Review, Hesket and co-authors explain customer satisfaction in a nice equation. Customer loyalty drives growth and profits. Customer loyalty is generated by customer satisfaction, which in turn is a result of the quality of services/ products. Company policies foster employee engagement and better-engaged employees improve quality. Each component in this relationship is the driver as well as the result of the others.
Building upon concepts on similar lines by various management gurus, consulting practitioners have developed customer satisfaction surveys as a performance measurement and management tool (Williams and others, 2016.)
Take a simple real-life example that is familiar
There are several HR consultancies in the UAE. For your HR consultancy requirements, you may try the big names or the ones that happen to send you a mailer. Finally, you settle for the HR consultancy that meets your needs; your choice is based on personal experience. Satisfied customers accelerate the HR consultancy’s growth, which in turn encourages the people in the agency to deliver better services.
The real-life scenario sets out the roadmap for customer satisfaction survey and the multiple benefits it can deliver.
Aims and a packet of benefits:
Most of the time, companies conduct a customer satisfaction survey for marketing purposes but the objectives for a management consultant could be different. While both survey the same attributes, the consultant analyses the data for measuring the performance of the business and prepare a roadmap for converting human resources into human capital.
Some of the HR Management studies, for e.g., Martinaityte (2016,) have looked at the performance of only front-line staff during their customer satisfaction surveys. Our consultants at HLB HAMT, however, go beyond this limitation, as we believe that quality is the outcome of an effort by the entire company. We analyze the performance of all the stakeholders ranging from designers, production, finance, warehouse staff, front-line staff, and even the logistics personnel.
The comprehensive analysis will help you to:
- Analyze the strengths of your product/ services in terms of quality and marketing,
- Identify skill-gaps and which of the functions (production, sales, finance, distribution, etc.,) are lagging,
- Develop scientifically purposed Learning and Development programs for each function,
- Design a Performance linked Reward and Recognition Policy,
- Fine-tune Human Resources and recruitment strategy for the entire business
- Control costs
To put it succinctly, customer satisfaction survey helps to drive growth and profitability. To know how to customize the strategy for Dubai, Abu Dhabi or elsewhere in the UAE, reach out to our HR advisory specialists and we will be glad to assist.
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Dubai to provide equal opportunities for public and private sectors
Lavin Nalinababu, Business Consultancy
Phone:- +971 4 327 7775
Mobile:- +971 55 160 1291
WhatsApp:- +971 56 219 1607
Email:- dubai@hlbhamt.com
Dubai passed the Executive Council Resolution (No. 23) of 2020 earlier this week, as per which no government-owned businesses in Dubai will compete directly with the private sector. The Resolution sets clear guidelines on the how-to launch any new government company.
In the post-COVID-19 environment, the government of Dubai aims to provide more space to the private sectors. Sheikh Hamdan said that “We are keen that the private sector plays a major role in shaping the future of the national economy and achieving sustainable development”. He also mentioned that, ” We did not want to be a competitor to the private sector, but rather seek to complement it”.
The Resolution of the Dubai government ensures growth and security to the private sectors. Afzaal Hussai, chief operating officer at Azizi Developments said that “The principles uphold fair competition and no other advantages being given in the form of financial support, tax, fee, charges or tariff exemptions, we see this decree as way for the public sector to complement the private sector rather than competing with it. ”
According to the Resolution, a government-owned entity is allowed to establish a company only if its ‘main activity falls within the objectives of the entity’. And any company created in this manner should stick to the principles of fair competition. Any kind of financial support from the government will not be received.
Such a Resolution is a rare decision made by the government, a government entity not receiving any support from the government in order to complement the private sectors.
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