Dubai’s new welfare ratings system for construction firms is a step in the right direction and should be closely watched by other members of the GCC.
Some parts of the region (as seen in a series of Guardian newspaper reports in recent years on Qatar) have come under persistent attack from the human rights lobby groups for how migrant labourers are treated – with low pay, restrictive contracts and poor living conditions cited as widespread issues the authorities should address.
While measures have been taken to improve conditions for workers – Qatar, for example, has new rules in place to pay workers on time into their bank accounts and has also built Labour City, spacious, air-conditioned new accommodation for workers – there is more to be done.
Although contractors in many parts of the Gulf are obliged to comply with employment regulations setting minimum standards for employees, there has historically been no incentive for them to go above and beyond.
Dubai’s Taqdeer Award, announced by the Crown Prince of Dubai, Sheikh Hamdan, on Saturday, is clever for that reason. It provides a strong financial incentive for companies to put more effort into improving conditions for workers: that is, they would stand to win more work if they score highly under the programme.
Under Taqdeer, which means ‘appreciation’ in Arabic, companies are invited to submit an application to be evaluated by a judging committee, which will score them out of 1,000 based on their performance against key criteria.
Applicants will then be awarded a rating ranging from one to five stars based on their score. Companies with at least 700 points will be awarded five stars and be prioritised in government and other tenders for new projects, while companies with less than 200 points would receive just one star.
The award scheme is not compulsory so, clearly, there are unlikely to be many one-star-rated contractors. However, in a fiercely competitive market, if more and more firms get rated, Taqdeer’s very visible measure of quality could prompt those that know they would perform badly to up their game.
What’s more, the judging criteria appear to cover a robust range of indicators. ‘Essential fundamentals’ examines things like corporate labour policies, health and safety procedures, wages, facilities and infrastructure; ‘culture and work environment’ assesses the applicant’s internal monitoring and transparency systems, as well as the efficiency of its administrative processes, and ‘results’ looks at labour perceptions and performance, presumably against existing regulations and with reference to employee case studies.
If the system works it would create a happier workforce, better quality contractors and improved international perceptions – crucial if the Gulf is to become a global business centre for decades to come.
On another note, buyers who prioritise human rights and workers living conditions as a factor when buying real estate might be more included to invest in a project which is advertised as being built by a contractor with a five star rating, therefore creating even more incentives down the food chain.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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