Saturday, October 3, 2015

Labor law or laborious law?

The recent announcement of major reforms in the labor laws of United Arab Emirates has become the talk of the town among expats working in Saudi Arabia.



The happenings around the kingdom do have an impact on us. The UAE Ministry of Labor has announced widespread reforms which would take effect from 1st January, 2016. I would like to highlight just the major ones for the sake of comparison with the kingdom's own labor laws.

As is normal all over GCC, one needs a sponsor to work in UAE. For years together, some unscrupulous sponsors have been using this as a pretext to deny expats what was rightfully their due. As in the kingdom, the most common complaint was giving a salary much lesser than what was contracted, making employees work in jobs completely different from what was agreed and in some cases, not paying employees for months together. All that is going to change very soon in the UAE.

Starting from 1st January, the Labor Ministry has announced that the role of sponsors would be restricted only for legal entry of expats into the country. Beyond this, they would have no say as far as the employment contract is concerned. A standard unified contract would have to be submitted to and approved by the Labor Ministry even before an expat lands in the country. This standard contract is very elaborate and has all required provisions - job title, salary and benefits. It also has provisions for early termination of contract on either side. Once the contract is signed by the expat, there can be absolutely no change in any of the terms and conditions and the sponsor would have to necessarily abide by what was agreed in the contract. 

In case the expat decides to quit the company, he can do so and join another company provided he has completed at least six months with the original sponsor. Even this six month period is waived for certain categories based on their skill sets. There is no such thing like NOC, etc., once you cross the six-month period. 

Wait, the best is yet to come. In case an employer does not pay for more than 60 days or the company shuts down, the employee will automatically be eligible to move over to another employer. If either party wishes to terminate the contract, they may do so at any point of time. The standard contract clearly mentions the conditions and what is to be followed by either party in case of termination of the contract. So, the employer as well as employee know fully well what is in store for them before commencement of a contract. All existing contracts will automatically be converted into the new standard contract from 1st January. Everything is uploaded in the system and is completely transparent for both the parties to see at any point of time.

This is what we call as fair pay for a fair work. Just imagine what would happen if we had a similar arrangement in the kingdom. To begin with, the Saudi labor law was last revised in 2006 and even this is totally one-sided in favor of employers. The problem of absconders ("escapees" as the local press would love to call) would be totally wiped out. How many expats get their pay on time? How many are actually doing the job as per their visa titles? Why to have artificially created barriers based on iqama-based job titles by which thousands of expats are denied permission to bring their families?  Why is there a need for an exit/re-entry visa at all? Why can't things be more transparent and less complicated?

The question among expats in the kingdom is not when but whether there will be true reforms in letter and spirit.

4 comments:

Abdul Qadir said...

Great article, Expatguru. Expats have already started leaving this country and those who haven't are just waiting for the right opportunity. There is no point in hoping for something which would never happen in the kingdom in another thousand years.

Mrityunjay said...

HI
Thank you
I am going to saudi. I am worried ..... its hard for me to take decision.

If, This rule got implemented hope people wile like to stay in Saudi.

thank you for this post

mohseen khan said...

Good Info

law-arab said...

thank you so much