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Home News & Reports Qatar to implement wage protection system; doesn’t fully address workers’ needs

Qatar to implement wage protection system; doesn’t fully addressworkers’ needsShare Find us on Twitter Find us on Facebook Find us on ... Share this via email

The WPS in isolation will do little to improve conditions of low-income migrant workers in thecountry. Qatar's failure to reform the oppressive sponsorship system shows reluctance to delvedeeper into its labor market problems.

Feb 26 2015

Qatar approved amendments to the labour law on 18 Feb; key among which is the introduction of theWage Protection System. The system, which has already been implemented in Saudi Arabia and UAE,will make it mandatory for companies to pay their employees through bank transfer.

Companies will be given six months to implement this, failing which, violators would be liable for jailtime up of one month and fines of up to QR6000.

No more details are currently available.

In May 2014 Qatar announced wide-ranging reforms to kafala and labor laws, but has since madeconflicting statements at various international and regional forums, much to the frustration of rightsactivists, recruitment agencies, and migrants.

Pressure on Qatar mounted in December 2010, following its successful bid for the 2022 FIFA World Cup.Four years later, and one world cup away from D-day, Qatar still seems reluctant to commit to improvethe lives of the low-income migrant workers building its infrastructure and dreams.

The Kafala system and poor labor protections facilitate the rampant abuse and exploitation of theseworkers, who remain voiceless and invisible.

One of the biggest problems facing workers is non-payment or delayed payment of wages, resulting indepleted standard of living for both the workers in Qatar and their families at home.

These are solutions tailored by ‘consultants’ far removed from the reality. The needs of workers has notbeen taken into account.

Criticism of WPS

Labor rights activists feels the WPS is a misinformed, even if outwardly well-intentioned, response to theproblem

Speaking to Migrant-Rights.org, one activist said the problem with wages involves more than non-payment, but includes wrong computation, lack of overtime pay, and unfair deductions. . “When the

worker only receives a bank transfer, without a pay slip, he can’t contest it then and there. The first stepshould have been a minimum wage commitment.”

He adds, The needs ofworkers has not been taken into account–their education level and cultural context for instance. Of course,this provide another opportunity for ‘consultants’ to make money by conducting workshops.”

The WPS for now is the only available salve in the GCC’s severely malfunctioning labor market, andQatar will have to ensure careful implementation to mitigate at least some of the problems migrantworkers face in relation to salaries. It has two case studies close to home to study and improve upon.

Regional Models

The UAE was the first to announce the WPS in 2009. Implementation was rolled out in phases based onthe size of the companies.

Companies could enter into a contract as WPS agents with any bank, bureau de change or financialinstitution approved and authorized by the Central Bank of the UAE.

Saudi began work on its WPS in 2013. As of November 2014, it completed implementation of threephases (workforces of over 3000, 2000 and 1000), and entered the fourth stage covering companies withworkforces of over 500.

“Public transportation continues to be scarce, and the workers are unwelcome in the glitzier parts of theDoha, further restricting workers’ access to their money.”

Hurdles to implementation

Saudi, unlike the UAE, restricts WPS to banks alone, placing heavy demands on its banking system.Following Saudi Arabian Monetary Agency’s (SAMA) demand that pressure be eased on the Kingdom’sbanks, it delayed the fourth phase from July to November 2014.

A majority of companies (between 65% to 90% based on workforce size) had complied in both Saudi andUAE. For instance, in Saudi, in the first phase (over 3000 workforce), a total of 119 companies fulfilledconditions out of 184 companies, while 48 companies pledged to submit their updated data soon after thedeadline and 17 had services halted by the ministry for failure to comply with the new system.

In the second phase, (over 2000 workforce) 81 companies fulfilled the ministry’s demands, 13 werepenalized for failure to comply, and 17 companies resumed services after complying past the deadline.

Punitive measures in both UAE and Saudi include suspension of ministerial services and suspension ofnew work permits.

Challenges and Opportunities for Qatar

Though over 90% of Qatar’s workforce is foreign, its total population is much smaller than the UAE orSaudi. Foreigners account for 87% of the nearly 10 million residents in the UAE; and over a third of thenearly 30 million in Saudi. This, coupled with Qatar’s geo-advantage – its economic activities are centredaround Doha and a few oil and gas townships- should enable quick implementation and wide coverageof WPS.

Currently, there are no ATMs in areas where low-income migrants are housed.Public transportation continues to be scarce, and the workers are unwelcome in the glitzier parts of the

“These are solutions tailored by ‘consultants’ far removed from the reality. 

Qatar must also consider workers’ ability to fully benefit from the new system by improving access tobanking infrastructure. 

TweetTweet 15 TweetTweet 15

Doha, further restricting workers’ access to their money.

While Qatar has not made the actual system public yet, the wording of the announcement indicates it willsimilarly be restricted to bank transfers, putting to test the preparedness of the banks.

However, reports in a local daily indicate that exchange houses are preparing to be part of the WPSnetwork, which would ensure much deeper reach. The article highlights scope for misuse of this systemtoo.

“…the new rule doesn’t seem to bother some illegal workers as they think their original sponsorscould open salary accounts for them with financial institutions, as required by the law, andtransfer their wages.

And they could return their employers the cash immediately after, said a ‘free visa’ worker. This ishappening in the case of expatriates whose salaries are low and they want to show bigger salarytransfers to be eligible to sponsor their families.

“Their sponsors transfer extra sums as part of their salary and that sum is returned to them.” A‘free visa’ is a work visa for sale on which a foreign worker arrives after buying it and takes upwork elsewhere illegally. In most cases, as per rule, a worker’s sponsorship is officially transferredfrom ‘free visa’ to a regular visa after a year. As for runaway workers, they can be paid wages bytheir illegal employers in cash.”

Though the WPS may prove one step in the right direction, even if perfectly implemented it remains onlya partial resolution to the systematic exploitation of migrant workers. For the WPS to have an enduringimpact on the condition of migrant workers, Qatar must live up to its commitments to reform.

Posted In GCC, News & Events, Qatar, Sponsorship, Working conditions

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