|30 March, 2020

Coronavirus in UAE: Private firms call new order of restructuring jobs, staff salaries a relief

Companies should not use the rule as a trump card against employees

People wear protective masks, following an outbreak of coronavirus, as they walk at Global Village in Dubai, United Arab Emirates, March 10, 2020.

People wear protective masks, following an outbreak of coronavirus, as they walk at Global Village in Dubai, United Arab Emirates, March 10, 2020.

REUTERS/Satish Kumar

The UAE government's decision to allow private sector establishments to restructure jobs and staff salaries has come as a huge relief for industry players.

Many in the hospitality, entertainment, transportation and tourism sectors that are hard-hit by the coronavirus-related restrictions, said "it is a huge favour" by the government.

"It has many advantages. The rule helps owners manage cost efficiently and also retain staff," Mohammed Rafi, chief operating officer of Flora Hospitality, which has eight hotels in Dubai, told Khaleej Times.

Rafi said the group had to temporarily close seven out of eight hotels since the beginning of March. "We have 600-plus employees and now we are down to around 150. Most of our employees are either on paid leave or on compensatory leave already."

"We will not take any decision that is harmful to our employees. We are taking them into our full confidence. Even those who are on long leave know that we will call them back once the situation improves."

"We have to meet the expenses and run the establishment. But at the same time there are hundreds of families that are dependent on us. We have to act responsibly and take mutual decisions," said Rafi.

Varun Wahi, director, client services at Edge Marketing, said the new rule will offer flexibility to businesses like event management companies.

"There is a massive reduction in the scale of events that we are conducting. So, this is definitely a support for businesses."

But in the same breath, Wahi said companies should not use the rule as a trump card against employees.

"Company owners can take a call. But they don't have to do anything immediately. We released our march salaries. But if the situation does not improve, I will have to move to the next option, which is mutually beneficial.

"Gaurav Varma, CEO, The Royal Orchid Group of Companies, said: "It is the best news for private sector. The hospitality industry has taken a hit. And If they have to take decisions to lay off staff or send some on unpaid leave, there are legal repercussions. But now, the government has given us a big respite by this timely decision."

Varma, who runs a chain of restaurants in Abu Dhabi, said staff who are on leave are well taken care of. "It is a hard time for everyone. I believe businesses have the responsibility of taking care of their staff too who have families back home. We are ensuring that their salaries are paid on time and food is delivered to them. We are all in it together."

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