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Business Reopening in Abu Dhabi and Dubai – Complying with Federal, Emirate & Free Zone Rules

26 April 2020

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By: Dr. Constantin Frank-Fahle, LL.M.

On 22 April 2020, the Abu Dhabi Department of Economic Development (ADDED) and the Dubai Department of Economic Development (DDED) issued guidelines for business reopening. While the guidelines do not contain a date for the business reopening, they contain additional measures for business owners to implement to stop the Covid-19 virus from spreading. This article provides an overview of the guidelines and key considerations for ramping up business in the emirates of Abu Dhabi and Dubai.

 

1. What happened so far?

The UAE government has adopted various measures to minimize the spread of the Covid-19 virus. On 26 March 2020, the Ministry of Human Resources and Emiratisation (MOHRE) issued Ministerial Resolution No. 279 of 2020. The resolution was issued to increase the stability of employment in the private sector. Ministerial Resolution No. 279 of 2020 regulates that private companies should implement a remote working system before granting paid or unpaid leave or agreeing on temporary or permanent salary reductions (Ministerial Resolution No. 279 of 2020). On 29 March 2020, MOHRE passed Ministerial Resolution No. 281 of 2020 to regulate remote working in the private sector. The Resolution also includes a brief guide, added as an annex to the Resolution, on how to implement remote working structures.

Following this, the emirates of Abu Dhabi and Dubai ordered that individual businesses had to shut down wholly or partly. E.g., Dubai issued a three-week lockdown on 4 April 2020 with the exemption of vital industries. Circular No. 10 of 2020, issued on 6 April 2020, clarified the vital industry definition.

On 22 April 2020, the Abu Dhabi Department of Economic Development (ADDED) and the Dubai Department of Economic Development (DDED) issued guidelines for business reopening. The guidelines contain a set of measures that must be implemented by business owners whilst reopening, in order to contain the spread of the Covid-19 virus.

 

2. Which guidelines have been issued?

Abu Dhabi Department of Economic Development – Circular No. 26 of 2020

The Abu Dhabi Government plans for a gradual increase in economic activity. In line with this objective, ADDED explored options in collaboration with the private sector and issued Circular No. 26 of 2020 on 22 April 2020 regarding the reopening of malls (Circular). The Circular does not contain a final approval for the re-opening.

The Circular deals with the reopening of malls and stipulates general rules (Art. 1):

  • Opening hours: 12-9 pm
  • General mall capacity limitations (30%);
  • Food & beverage capacity limitations (30%) and a maximum of 4 people (minimum of 2.5m distance between tables);
  • Gyms, cinemas, and other entertainment venues are restricted to operate; and
  • No entrance for older people (60 years and above).

 

The Circular also includes a set of restriction for mall operators (Art. 2), among other things:

  • Wearing masks and gloves is mandatory for all mall visitors and staff;
  • Limiting parking spots to 50%;
  • Installation of thermal screening at all entrances (and denying visitors entrance if their temperature is above 38C);
  • Disabling all touch systems; and
  • Availability of paramedics throughout the operating times.

 

Finally, the Circular includes obligations for tenants (Art. 3), among other things:

  • Covid-19 testing of all staff before reopening and regular temperature monitoring of staff;
  • Restriction of product testing (e.g., shoe trial, make-up, etc.); and
  • Availability of sanitizers at every counter.

 

Dubai Department of Economic Development – Guidelines & Protocols for Reopening

The Dubai Government plans for a gradual increase in economic activity. In line with this objective, DDED issued “Guidelines & Protocols for Reopening” (Guidelines). The Guidelines do not contain a final approval for the re-opening.

The Guideline sets restrictions and protocols for various commercial activities, among other things:

  • Retail & Wholesale;
  • Transport & Logistics;
  • Construction;
  • Manufacturing; and
  • Office & office building restrictions.

 

The Guideline includes scales concerning:

  • Social Distance Risk (low, high and medium);
  • Importance of Economy (low, high and medium); and
  • Opening Stage (1, 2, 3, and 4)

 

The Guideline also includes further information on:

  • Activities included and excluded in the respective sectors;
  • Dubai Health Authority Feedback; and
  • Dubai Municipality Feedback

 

For each of the relevant listed commercial activity, the Guidelines include an action plan with a short description of the task to be undertaken. The restrictions issued concerning retail & wholesale (p. 3-6 of the Guidelines) are more detailed than ADDED’s Circular but build on the same idea of implementing a set of crowd control measures.

 

3. How can businesses comply with the various rules & regulations?

It is important to note that business owners in the UAE have to deal with various rules & regulations that were issued under tremendous time pressure. On the one hand, the stakeholders dealt with containing the spread of the virus. On the other hand, the competent authorities were interested in mitigating the economic impact of the measures.

Managers and business owners need to ensure that they comply with these regulations. While the Guidelines include sector-specific requirements, business owners also need to ensure compliance with more general rules (e.g., Ministerial Resolution No. 281 of 2020 and UAE Federal Labour Law, etc.). To the extent that the rules & regulations contradict each other, business owners need to consult with the authorities and/or legal experts on how to react to such contradictions.

 

4. What are the key considerations for ramping up?

Business owners should segregate the measures in five stages for ramping up:

  • First Stage: Preparation for Reopening
  • Second Stage: Reopening of Operations
  • Third Stage: Reaction to renewed operational restrictions (second wave of infections)
  • Fourth Stage: Economic Recovery
  • Fifth Stage: Operation running at full capacity

 

1st Stage – Preparation for restarting business

With the gradual resumption of operations, there will most likely not be a full utilization at once. Key questions include:

  • What proportion of the workforce is needed for a start? Can capacities be planned flexibly?
  • Who needs to return to work, who can continue to work remotely?
  • Can a rotating system be operated?

 

At the beginning of the lockdown, things happened quickly. If the remote work is now extended to a longer period, the pragmatic solutions found must now be poured into a (right) secure foundation.

  • Do you comply with Ministerial Resolution No. 281 of 2020?
  • Does the IT infrastructure allow permanent remote access, or do capacities need to be increased?
  • Are IT security and know-how protection guaranteed?

 

To reduce the continuing risk of infection as much as possible, suitable protective devices and control mechanisms must be put in place before business/production operations can resume (Ministerial Resolution No. 281 of 2020 & Emirate specific guidelines).

  • Are there enough disinfectants available?
  • Are reconstruction measures necessary (e.g., to comply with the distancing requirements) to interrupt infection chains?
  • Has an attendance documentation and a system for determining contact persons in suspected cases been implemented?
  • Is a process defined for health checks and reports, such as mobile fever measurement or the like?

 

2nd Stage – Partial restart of operation

Mixing employees increases the risk of infection of large parts of the staff. The fewer contacts each employee has, the better.

  • Is it possible to form small workgroups, so-called “team splitting”?
  • Under which conditions can a shift system/night shifts be installed?

 

MOHRE & other regulatory bodies have implemented the concept of measures that employers have to implement (when the company reopens).

  • Do you comply with Ministerial Resolution No. 281 of 2020?
  • Do you comply with Dubai Economy’s Reopening Guideline?
  • Do you comply with Free Zone-specific circulars/announcements?

 

If an in-house corona task force has already been set up, it must be checked to what extent further competencies can be assigned to it. In particular, all monitoring and reporting obligations should come together in the corona task force. To limit management liability, the corona task force should be given the task and duty to monitor new developments and report accordingly (changes in the applicable law (federal, emirate & free zone level), state-prescribed mask requirements, loosening/tightening of restrictions, etc.).

 

3rd Stage – Reaction to potential renewed operational restrictions due to a second wave of infections

If the operational activity has to be reduced again as the number of infections increases, operational restrictions may be renewed. As in the first stage, it must be ascertained which options are available under the company policies to react to the operational restrictions.

  • Is there an adequate basis in the individual agreements with the employees, for a unilateral reorganization by the employer for reduced working hours?
  • If this flexibility is not available, it should be created so that the employer can also react to the reintroduction of lockdown measures at short notice. It should also be clarified at an early stage who is responsible within the company for notifying adjustments to reduced working hours to the employees.

 

In the event of a “re-lock-down,” there can be a shortage of raw materials & personnel again very quickly.

  • What is the legal framework to flexibly build up short-term personnel requirements, e.g., through limited contracts (possible to use the Virtual Labour market – Ministerial Resolution No. 279 of 2020)?
  • To what degree can commercial activities be outsourced temporarily?

 

4th Stage – Economic recovery and order recovery / increased customer volume

Once orders are recovered and businesses deal with an increased customer volume, the following questions should be addressed:

  • Should remote jobs be retained even after the acute crisis?
  • Has the remote working proven itself effective (cultural change/acceptance of the home office)?
  • Are employees entitled to work remotely (will Ministerial Resolution No. 281 of 2020 make its way into the UAE Federal Labour Law)?
  • Should particularly vulnerable workers remain in the home office while non-risk workers return to the company?
  • To what extent and when should business trips be permitted again?
  • To what extent must the business travel directive be supplemented and expanded to include health and safety regulations?

 

Due to the disrupted vacation plans of the workers during the lockdown period, there is a risk that an increased number of vacation days will exist during the economic recovery with high personnel requirements.

  • Have holiday entitlements been used up?
  • How can vacation claims be reduced preventively and as far as possible by mutual planning?

 

5th Stage – Operation running at full capacity

Ordering overtime requires a legal basis. The minimum rules are laid out in the UAE Federal Labour Law (Art. 67 et seq.). Clauses depriving an employee of his right to earning overtime wage for extra working hours completed over the prescribed legal limit will generally be deemed null and void.

The protective and organizational measures carried out during a lockdown must be assessed with regard to the purpose pursued and the suitability for achieving it and, if necessary, should be adapted. In particular, the emergency plan concept should be revised and adjusted, if necessary, either based on specific events in the company or based on generally gained knowledge.

 

5. Conclusion

The crowd control measures issued by ADDED and DED are very much in line with best practices from  Singapore. Singapore had issued similar restrictions a month earlier. The Supreme Committee of Crisis and Disaster Management announced a partial reduction in the restrictions on movement in the emirate of Dubai starting from 24 April 2020. Business owners must ensure compliance with the various rules & regulations issued with regard to combating Covid-19. In particular, they should

  • understand the general rules & regulations that have been issued so far (e.g., Ministerial Resolutions No. 279 & 281 of 2020);
  • review the business opening guidelines, monitor further announcement with regard to the actual business opening, and ensure compliance with the various rules & regulations (federal, emirate & free zone level); and
  • set out a stage-specific plan that can be executed along with the governmental orders.

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Dr. Constantin Frank-Fahle, LL.M.
Managing Partner | Attorney at Law
+971 (0)2 694 8562 | frank-fahle@germela.law | www.germela.law
GERMELA LAW LLP | Al Sila Tower, 24th Floor | Abu Dhabi Global Market Square | Abu Dhabi | UAE

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