Sunday, May 21, 2006

Besix workers turn violent, beat up their colleagues :: Khaleej Times

Rashid Bakheet, Member of the Permanent Committee of Labour Affairs, told your favourite No. 1 newspaper, Khaleej Times, yesterday that the committee checked all the documents of the company and visited the labour camp. The company is paying on time and the accommodation is good. The committee is satisfied with the company and it is a well- run company,” he said. “The workers’ demand of an increase in their salary to Dh1,000 and provision of Dh300 for food allowance is not an acceptable demand. They should abide by the labour contract they signed,” he added.
An easy solution for the firm would be to call in replacement workers. The trouble is the UAE labor rules do not allow firms to go onto the local market to hire workers - all ex pat workers in the UAE (over 98% of the private sector workforce) are essentially locked into employment with the employer - that is, they can't change jobs readily.

I've been arguing for a relaxation of the rules that limit or make it costly for firms to hire workers on the local market. I have in mind giving workers greater freedom to change jobs.

It's not what I had in mind, but the recent proposed plan for Worker Cities, where there would be large labor renting companies, would also make it easier for a firm to swap out its workers if it wished. It's not immediately obvious that workers such as those striking at Besix would be better off under the Worker Cities plan.

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Blogger uae alias said...

By local market you dont mean those who already have job contracts, becuase this is what i get when i read your article... Can you imagine the chaos that might happen!
because when a woker come to UAE tied to a contract that justify his residence in the country and determine the tie interval will make them into thier work and less manipulative...
The chances of manipulating by the workers and the firms will increase... the firms may try to get other firm's workers... or the worker will try to find somewhere else... I can write a book on the expected stories if such thing happened... we are strict now and look what is happening ! this will also increase the unleagal immegrates like the case of USA... so nah i dont think its a good idea!

10:45 AM  
Blogger Papadose said...

Fix a flexible visa system where workers/employees share a part of the burden of visa expenses in the form of fees and what not. Then maybe a certain degree of freedom of movement can be offered.
A minimum wage has to be fixed.
Labour inspection needs to be boosted.
Economics and logic need to be used here.., not overbearing sympathy.
It is naive to think that labourers dont have a clue as to what they are getting into when they hand over their life saving to get here. Everyone knows the drill. They know its hard work and they are prepared. The problems arise when they arrive to see that their salaries are not paid in time; hidden deductions creep into their salaries and housing is way substandard.
What we need is practical laws that take into consider the "EMPLOYER". Thats the only way you are going to have a solution. Otherwise its only going to be a maze of enless loophole expolitation after the other. For instance check out this example:

7:05 PM  
Blogger Papadose said...

It costs a C grade company around AED 7500 to bring in a worker. And almost every single contracting company out there is C grade as it is nearly impossible to bring in a demographic balance in the blue collar work force. They will and always will be dominated by the Indian Subcontinent.
So do your math. If a construction company takes itself seriously it will need at least a 100 strong manpower force. Thats AED750,000.
Then there's the ticket to get him here, immigration and medical charges from the country of origin, his monthly accommodation, food, work wear, gratuity, leave salary....on and on. Imagine the company's situation if a few workers absconds.
Now why would he abscond:
1. His salary is too low to make up for the other expenses covered by the company and the lack of a minimum salary stipulated by law.


2. He knows that in the illegal market he can earn much more an hour as it is a thriving market owing to a shortage in labour.

Herein lies the problem. Its very easy for everyone to sound politically correct and condemn every other construction company out there.
The problem needs to solved from the grass roots level:
clean out the illegals market, visa costs reduced, regulate and encourage large scale labour management companies, fix a minimum wage,....etc

7:07 PM  
Blogger John B. Chilton said...

What would a minimum wage do? By definition it would pay the worker more than necessary to attract the worker. That's cream to be skimmed either by someone who can extract from the worker. That someone might be the recruiter who can sell the valuable job for the value of the cream, or it could be the employer, or it could be a supervisor of the worker.

Please help me understand if I am missing the point of the minimum wage.

7:12 PM  
Blogger Papadose said...

Now think of a company like Besix. Every three years they may have to renew contracts for 10,000 workers at a total of
AED 36,500,000. Thats why you have bare minimum salaries.

The AED1000 the workers are demanding is a joke with all the expenses connected. Inflation was assummed to be at 15% or more last year. People complain about a 5%increase in their grocery. How about increasing the minimum wage to AED1000? Inflation graphs would be a pretty sight. What was once a small problem suddenly becomes big. Earlier workers were demanding to pay salaries on time - which was just - now demands are suddenly bigger. Strikes must not be allowed to cripple the growth of this city.

7:31 PM  
Blogger Papadose said...

You're right in the fact that a minimum wage wont accomplish much. i feel that by fixing a minimum wage it would signal to future recruitees that "this is the wage the government is fine with and if you are being paid more then maybe you are getting a good deal."
The problem now is that workers in the country assume just about any salary offered is exploitative. I know of companies where salaries for cleaners are fixed at 450AED and some where food is deducted from that. Some have fixed it at 700AED. I read somewhere the general norm is AED500. The problem is the tendency for any blue collar worker is to feel exploited with all the media attention on them. This is dangerous as strife is infectious. There are several companies in the UAE who take care of their workers well. But by not having a standard to relate to, how will you know that you are getting a good deal?

10:20 PM  
Blogger John B. Chilton said...


Thank you for the comment. It's food for thought - that there's informational content to a government set minimum wage. Perhaps the government could simply report what the terms of existing contracts are. These norms would be useful for the reasons you articulate.

I concur, too, that strife can be infectious. What is the government policy implication?

11:25 PM  
Blogger Papadose said...

I think the only way seems to be to establish some kind of representative union where any strikes conducted otherwise through them could be deemed illegal. Damn, i hate the word 'union'.
But some kind of representative office for workers which will look into their issues and complaints. I believe this is already setup or planned to be; and it needs some time and be well staffed. Also Worker city seems to be a good idea (with labour management companies regulating worker flow)

What is great about this city is that there is a geniune effort to solve these problems and they need to be given time. But what is scary is the coordination with which 10,000 workers collectively downed their tools. I guess at some point the authorities would have to get tough, because if coordination to strike at this level is possible, that number may be expanded in the future to serious proportions. Remember workers are a huge section of the population.
I remember reading an article in the Economist warning specifically about this.

12:27 AM  

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