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Saturday, September 18, 2021

Report: Nepal pushes for higher minimum wage for its workers in Qatar

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Photo for illustrative purposes only.
Photo for illustrative purposes only.

Qatar is resisting calls by the Nepalese government to increase the wages of workers who come from the south Asian country, an official based there has said.

Speaking to the Gulf Times, Suresh Man Shrestha – the secretary of Nepal’s Ministry of Labor and Employment – said officials from his government have formally requested that their counterparts in Qatar review the salaries of Nepalese employees here.

“We are asking for a minimum wage agreement with Qatar, but Doha has not yet agreed to it,” Shrestha was quoted as saying.

His comments come two days after a meeting in Doha between Qatar’s minister of labor and social affairs and the Nepal embassy’s charge d’affaires, Qatar’s state news agency reported Tuesday.

Economic importance

Expats are seen lining up at a Qatar money transfer and exchange shop in this file photo.
Expats are seen lining up at a Qatar money transfer and exchange shop in this file photo.

Embassy officials have previously estimated that the number of Nepalese workers in Qatar hovers around 400,000. Most work in low-paying positions, often in the construction sector.

Nepal, like many other countries with large overseas workforces, is highly dependent on the money that its citizens earn abroad and send to family members back home.

In 2013, remittances made up 28.8 percent of Nepal’s GDP, according to the most recent figures published by the World Bank. That’s second only to Kyrgyzstan.

Higher wages earned abroad allow workers to send more money home, giving their country an economic boost. That gives officials an incentive to press their counterparts in countries such as Qatar to set and raise minimum wages, which also help low-income workers cope with this country’s rising cost of living.

Photo for illustrative purposes only.
Photo for illustrative purposes only.

However, the strategy can backfire. In late 2012, the Philippines asked Gulf countries to enforce its standard contract for overseas domestic workers, which includes a minimum monthly salary of US$400 (QR1,457).

That led to the number of Filipina domestic workers working in Qatar to fall by several thousand women last year, as local labor authorities placed an unofficial ban on the issuance of new visas, several recruitment firms said at the time.

Qatar has no standardized minimum wage and instead negotiates different salary levels with individual countries. This means workers’ salaries in Qatar can vary based on their nationality and that a company’s labor costs depend on the ethnicity of its workforce.

While a manager at one manpower agency told Doha News that some firms would opt to recruit from countries whose citizens command lower wages, he said that is not typically the deciding factor.

Instead, the manager said employers more frequently rely on racial stereotypes. Indians, for example, are typically in high demand despite officially having a higher minimum wage than laborers from other countries because they have a reputation for working hard, he said.

However, manpower agencies say a far greater determinant is an unofficial quota system run by the Qatar government that limits the number of work visas available to citizens of some countries for various positions.

Enforcement questions

In early 2013, the Nepal embassy in Qatar told Doha News that it was asking that the minimum wage for its nationals be raised from QR800 (US$220) – which includes a monthly food allowance – to a total of QR1,200.

While it’s not immediately clear what became of that proposal, the manager of one local manpower agency told Doha News last fall that the standard monthly salary for Nepalese laborers was QR900. Skilled workers earn slightly more and receive QR1,200 a month, the manager added.

Meanwhile, how strictly minimum wage rules are enforced remains in question. The dispute involving the Philippines only arose after officials in that country insisted that Gulf employers start honoring a five-year-old agreement.

Similarly, some have raised questions about how strictly companies in Qatar adhere to the minimum wage for Indian employees.

Indian wages

Workers in Qatar.
Workers in Qatar.

While the Indian embassy said its citizens receive at least QR1,500 a month for manual labor jobs and QR1,950 for some skilled positions, such as electricians, two manpower agencies who spoke to Doha News said the figures were actually lower.

One firm said it was QR1,000 a month for labors and between QR1,300 and QR1,500 for skilled workers, while the other put it at QR1,300 and QR1,500 for the respective job categories.

However, one of the manpower agencies – which specializes in recruiting workers from India – said the exact number is meaningless for some employees.

He said many workers will sign two contracts, each containing different salary figures. One will state the minimum wage needed to secure a visa, while the other will contain a lower number that the worker actually receives.

“It’s transparent for the employee and the company. The minimum salary is just for (immigration) clearance,” a manager told Doha News. “The minimum salary just exists on paper for the visa … Indians are OK with it because of their economic conditions back home.”

However, an official with the Indian embassy denied this practice occurs.

“All contracts that come to the embassy (meet) minimum wage (requirements) … We have received no complaints from (our) nationals saying that they are earning less than the minimum wage,” Sashee Kumar, a labor officer at the Indian embassy, told Doha News late last year.

He added that in the event of a legal dispute, a court would not honor any side deals that a company makes with employees outside the government-sanctioned agreement.

“The one accepted by the Ministry of Labor and (Ministry of) Foreign Affairs … will have to be honored in case of litigation,” Kumar said.

Thoughts?

18 COMMENTS

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A_qtr
A_qtr
6 years ago

Do what the philipines did and force a minimum wage.. Then educate the workforce on their rights .. Create support services in the respective embassy… This has worked for Philipinos .. Though change was slow it eventually caught on…

Does anyone know what’s the minimum wage for employees in the UK? Hourly wage… I think it’s $7.00 in the in the US but that makes no sense… An 8 hr a day job for 5 days a week means you make over $1,000 a month.. That’s like 4,000 Riyal a month…

I think a fair minimum wage in Qatar is

basic salary of 1,200 QR or 7.5 riyal an hr for a 40-hr work week.
1.25% overtime for weekdays and Saturday hours
1.5% overtime for Friday’s and national holiday hours
Food allowance 400 riyal
Transport allowance 500 riyal
Housing allowance 1,500 riyal

Assuming the employer is no longer responsible to arrange accommodation, transport or food for his employees. This way as an employer all I need to worry about is paying my employees on time and making sure they put in the hours…

The allowance may not be enough for a western expat living a bachelor life but it is expected folks need to sort out shared accommodation and pooling transport… Dunno but 3,600 seems fair enough as minimum wage with no overtime …

Two hrs a day overtime means 375 riyals extra … And a sat workday means an extra 300… Still low but puts you in the 1,000$ bracket
And if I make available housing.. As an option.. I would expect the employee to pay me from his housing allowance ..

Scarletti
Scarletti
6 years ago
Reply to  A_qtr

housing allowance of QR 1,500 a month is shockingly low – I have seen people spend more than that in the cake shop !

MIMH
MIMH
6 years ago
Reply to  Scarletti

For you yes, for others no.

Nourah
Nourah
6 years ago
Reply to  Scarletti

In your home country you don’t even dream of that.

Anonymouse
Anonymouse
6 years ago
Reply to  Nourah

You know Scarletti’s home country and the housing prices there? You are graced with ESP? As has been said repeatedly, and you should understand, this is not our home countries, prices are in riyals and the housing is stupid expensive.

Moleskine
Moleskine
6 years ago
Reply to  A_qtr

The minimum wage in UK is equivalent to $9.75 per hour, which equates to 6200QR a month based on a 40hr week here in Qatar.
However this is gross pay rather than net pay….deductions for National Insurance and any (small) tax liabilities will reduce the gross amount of pay the employee will receive to a lower net figure.
However, in the UK no allowances are paid so all living expenses (utility bills, transport, food, accommodation etc) would have to be paid by the employee out of her/his net pay.
By your example, cited above, of allowances paid to employees it would take a pay of 2400QR a month just to exist in Qatar. Therefore I would set the minimum wage in Qatar at this rate: 2400QR a month + allowances.

Moleskine
Moleskine
6 years ago
Reply to  Moleskine

2400QR a month salary = 13.5 riyal an hr for a 40-hr work week.

desertCard
desertCard
6 years ago
Reply to  A_qtr

$2 / hr is fair?

A_qtr
A_qtr
6 years ago
Reply to  desertCard

You’re excluding housings transport and food allowance

Moleskine
Moleskine
6 years ago
Reply to  A_qtr

Including all the allowances you proposed above, taking into account a reduction of 1 month in transport and food during annual leave, the cost to an employer of allocating a 13.5 QR per hr minimum to each employee would be 19 QR an hr ($5.25 per hr)

Incidental fees such as recruitment costs, airfare etc will also have to be added.

This is still 2/3rds of the US minimum wage rate, supposedly the World’s largest economy; Qatar revels in the fact that it has the World’s highest GDP per capita yet the rates I propose, with all the benefits incorporated, would make Qatar on a parity with Slovenia, S. Korea and Israel (see link) on what it pays its poorest employees.

http://www.theatlantic.com/business/archive/2013/09/how-americas-minimum-wage-em-really-em-stacks-up-globally/279258/

A_qtr
A_qtr
6 years ago
Reply to  Moleskine

Great points… I really believe pay your employees a fair wage and let them sort out how they allocate the money..

One thing we missed is health insurance.. Starting soon each employer will pay something like 2,400 annually as state medical insurance for non national employees

Anonymouse
Anonymouse
6 years ago
Reply to  A_qtr

Yes, the medical insurance will be interesting. Do you think it will lead to a rationalization of the use of the labor force?

Moleskine
Moleskine
6 years ago
Reply to  desertCard

I’d go with $3.70 per hour plus allowances

Expat77
Expat77
6 years ago
Reply to  A_qtr

Rather good if it’s minimum salary. But pvt sectors have various tricks. Pays overtime equal to 1%, overtime is based on basic salary but deductions from gross salary! No salary during travel home ..and random cuts 4 fines etc…..all in the name of smooth functioning. ..

JustMe
JustMe
6 years ago

It’s funny how people complain about the local driving etiquette and traffic when such ridiculously discriminatory practices take place under their noses. The eyes see what they want to I guess

Dobbin_the_Wonder_Horse
Dobbin_the_Wonder_Horse
6 years ago

From direct experience all the efforts of the Nepal Embassy to improve the lot of Nepalese expats have exactly the reverse effect.

The Nepal government introduced a policy where all workers must be recruited through a government registered agency, They must be offered contracts showing salaries at or above a minimum specified by the Embassy, For example a labourer must receive a minimum of QR900 + QR300 food allowance whereas a heavy duty driver with a gulf licence must receive a minimum of QR2,200 + QR300 food allowance. All good in principle but not so in practice.

With a monopoly on recruitment the agencies charge prospective workers to be considered for jobs. These ‘fees’ are usually in excess of NR100,000 (QR3600) and can equate to several months salary for the worker. Prior to the introduction of this system companies were free to recruit directly and most workers could avoid paying any fees. There were still cases of money changing hands in Nepal for local introductions but these were fewer and smaller. The current policy has simply institutionalised corruption.

Worse still, many of the minimum rates are well above the market rate for the job. Reputable companies who need to remain competitive and who are not prepared to see their workers fleeced by agents can choose to recruit from other countries. This reduces the number of jobs available to Nepalis and pushes them into the less reputable segments of the employment market where despite the minimum tarrif it is common practice for workers to be given one rate “on the contract for the Embassy” and a much lower rate in practice.

21-year-old Expat
21-year-old Expat
6 years ago

Salaries should be based on the competence and the cost of living here in Qatar. Simple as that.

Anonymouse
Anonymouse
6 years ago

Yep, but the supplier countries get to decide whether they grant recruitment privileges and visas and they will choose what they wish within their domain. They have no control over the salaries in Qatar, but they do control whether Qatar has access to that resource.

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