Timely payment of salary now a requirement in tender documents
March 16, 2020
By: Michael Earley, Senior Associate
Over the past several years Qatar has made tremendous strides in improving employee welfare. In order to ensure the timely payment of employee salaries, the Wage Protection System (“WPS”) was introduced in 2015 requiring employer to pay employee salaries directly into an employee’s bank account, rather than by hand which was the previous practice. Qatar also abolished the kafala system, and introduced a workers’ welfare fund. Despite the introduction of the WPS, there remained instances in which the payment of employee salaries continued to be delayed, particularly in the construction sector. In order to address this issue, the Public Works Authority (“Ashagal”) has recently introduced new tender requirements to ensure that workers in its projects promptly receive their salaries. In cooperation with the Ministry of Finance and the Ministry of Administrative Development, Labour and Social Affairs (“MADLSA”), companies bidding on Ashagal project must sign a statement committing that employees’ salaries will be paid on time. The signed statement is a one of the basic requirements for acceptance of a technical tender. Ashagal can also share project progress data with MADLSA to ensure payment compliance. In addition, companies seeking to participate in Ashagal tenders will also be required to provide a certificate from the Qatar Credit Bureau setting out their financial positions and the extent of their debts and other financial commitments. This Ashagal initiative, combined with the FIFA/Supreme Committee for Delivery and Legacy worker welfare programme, should provide additional support to those employees who are involved in many of the major construction projects in the country and address some of the concerns raised by some international labour entities.