Quick Take

UAE Report on Worker Welfare an Important Step toward Transparency, But Raises Some Concerns

David Segall

July 14, 2016

The United Arab Emirates (UAE) government recently released its first annual “Worker Welfare Report.” The report, written and published by the Ministry of Human Resources and Emiratisation (MOHRE), represents a positive step toward transparency for the UAE government. It is the first of its kind in the UAE and the broader Gulf region, and it demonstrates high-level recognition of the need to take proactive steps toward ensuring worker rights. However, the report also raises additional questions, and makes it clear that there is a long way to go when it comes to issues like migrant worker recruitment. Here are three takeaways from the report:

1. The UAE government is conducting regular inspections of work sites and companies, at least for some violations.
Since launching the Wage Protection System (WPS) requiring electronic bank payment of wages to workers, the government has conducted over 8,000 site visits related to suspicion of non-payment of wages. UAE companies have set aside AED 22 billion (app. $6 billion) in bank guarantees for workers per UAE law, and over AED 40 million has been garnished from those accounts to pay workers. The Ministry also carried out 4,127 health and safety inspections in 2015. MOHRE also provides an analysis of its new labor dispute submission process, and notes that a slight rise in the number of worker complaints received in recent years likely reflects increased trust in – and access to – this process. Finally, the government has appointed 63 legal professionals and an additional 100 staff members to assist with dispute resolution.

2. The government’s next report needs additional information for context.
For example, the Ministry notes that as of the end of 2015, 412 recruitment (“manpower”) firms were licensed to operate in the country. It would be helpful to know how many of those licenses were granted last year, and whether this figure represents an increase or decrease in the number of overall license-holders. The report also notes that 290,682 entities have signed up for the WPS, but does not estimate the total share of the corporate sector likely accounted for by these companies. The government should also estimate the number of “work sites” in the country, so that site visits conducted can be calculated as percentages of the likely total. The report also does not provide relevant time frames for some of the figures cited. For example, it notes 154,927 overtime-related site visits and penalties assessed “to date,” raising a question as to whether this and related figures represent all penalties ever assessed or those doled out during a particular time frame.

3. Recruitment fees are still a major unresolved issue.
According to the report, “the Ministry holds employers responsible for attesting in the standard contract that workers have not been charged recruitment fees [in their countries of origin],” but no corresponding mechanisms for investigation or enforcement are mentioned. And beyond noting that the government has been “cooperating with countries of origin to improve practices in the recruitment industry,” few details are provided on concrete steps taken. For UAE-based recruiters, the Ministry only notes that it must be fully “satisfied that a recruitment agency must recruit transparently, protect worker welfare and conform to UAE law,” without specific details on those criteria. When violations take place, the Ministry claims that it takes “immediate actions,” and that it “suspended the licenses of agencies that violated recruitment practices,” but no relevant statistics are provided. The report’s lack of detail on this issue suggests that little-to-no progress has been made toward combatting the payment of recruitment fees by workers.

4. The UAE is likely not robustly enforcing its laws and regulations related to decent accommodation for workers.
In 2015, the Ministry handed out six fines worth AED 10,000 (app. $2,722) each, and suspended the issuing of hiring permits to 15 other companies. Anyone who has visited worker accommodations in the region will recognize that truly serious enforcement of legislation related to housing for workers would lead to many more penalties.

As Mr. Saqr Ghobash, Minister of Human Resources and Emiratisation, points out: “The UAE’s workforce is [its] greatest asset: the driver of growth that enables economic diversification and secures the future for tomorrow’s generation.” While the UAE government should be commended for releasing this report – and its neighbors should follow suit – its next one should contain much more information. And in the meantime, if the government truly wants to be a regional leader, it should look to get serious about tackling difficult issues like those related to migrant worker recruitment.