Setting Up a Manpower Supply Company in the UAE

A manpower supply company directly employs and sponsors workers under its own trade license and then deploys them to work at client businesses under a service contract, distinct from a recruitment agency that simply matches candidates with employers who then directly employ them. This model is common in sectors like construction, facilities management, and hospitality staffing where client businesses want flexible workforce access without the administrative burden of direct sponsorship.

MOHRE licensing for manpower supply companies typically requires a substantial bank guarantee, generally higher than a standard recruitment agency guarantee given the company's direct employer obligations toward potentially large numbers of deployed workers, along with proof of adequate office and, in some cases, accommodation arrangements for workers between deployments. The manpower company remains the legal employer throughout, meaning it bears responsibility for visa sponsorship, salary payment, end-of-service gratuity, and compliance with UAE labour law protections regardless of which client site the worker is actually deployed to.

Because the manpower company is the direct employer, it also carries liability if wages aren't paid on time under the Wage Protection System, if workers aren't provided adequate accommodation or transport where relevant, or if labour law violations occur at the client site under working conditions the manpower company is still legally responsible for as employer of record. This makes robust internal HR and compliance processes considerably more important for manpower supply companies than for a standard recruitment agency that exits the relationship once a placement is made.

Client service agreements between the manpower company and the businesses using its workers need to clearly allocate day-to-day supervisory responsibility at the worksite while keeping the manpower company's statutory employer obligations intact, since ambiguity in these agreements has historically led to disputes about who bears responsibility when workplace issues arise. Given the direct employer liability and bank guarantee requirements involved, setting up a manpower supply business requires more substantial capital and compliance infrastructure than a standard placement-focused recruitment agency, and confirming current MOHRE requirements before proceeding is essential.