Breaking down labour plans

A new Labour Law - which has been in consultation since February - is set to be rolled out later this year. Michael Grose, construction law partner, Clyde & Co., takes a look at what this will mean for the local construction industry and those working within it.
Breaking down labour plans
By Michael Grose
Sat 22 Sep 2007 04:00 AM

Cast your mind back to 1982, a year that marked the Soviet Union's invasion of Afghanistan, the introduction of the compact disc player and a No.1 hit for Dexy's Midnight Runners with "Come on Eileen". Coincidentally, 1982 also marked the UAE's last major attempt at reform of health, safety and welfare laws. That may be about to change.

In November last year, HH Sheikh Mohammed bin Rashid Al Maktoum, in his capacity as prime minister of the UAE, called on the Ministry of Labour (MOL) to take measures to "regulate the affairs of the foreign workforce in the country and secure all requirements and conditions of health and safety standards and to ensure a decent living for them, whether in living accommodation or at the work site".

A new Labour Law - released for consultation in February this year - is one tangible consequence of that instruction. According to recent press reports, the new Labour Law is expected to come into force by the end of the year. This article reviews the consultation draft, concentrating on its likely impact on health, safety and welfare.

Standards of Accommodation

Overcrowded accommodation and other examples of poor living conditions for employees are a recurring theme in local and, increasingly, international news reports on working conditions in the UAE.

The new Labour Law will, if adopted, authorise the MOL to introduce regulations governing employees' accommodation. Although regulations setting out the minimum requirements for employees' accommodation have applied in the emirate of Dubai since 2001, the new Labour Law will be a federal measure, ensuring its application across all seven emirates.

No announcement has been made by the MOL about the likely content of the implementing regulations, nor the likely publication date. However, adoption of minimum standards for key aspects of accommodation, including space, provision of adequate services, protection against heat, cold, damp, noise and fire would be consistent with the UAE's membership of the International Labour Organisation and, specifically, the Workers' Housing Recommendation (1961). Significantly, the adoption of minimum standards would provide the MOL's labour inspectorate with a basis on which to measure and police the quality of employees' living conditions.

Medical Expenses and Medical Facilities

Dubai has already signalled that it intends to follow Abu Dhabi's example by introducing compulsory medical insurance for all expatriates.

The new Labour Law falls into line with this trend providing, for the first time, that "the employer shall bear all medical care costs of workers from the date of entry into the United Arab Emirates". The construction industry looks set to be targeted further by a requirement to provide medical care facilities for employees, details of which will be laid down by the MOL in consultation with the Ministry of Health.

Site Safety

Health and safety standards on site are currently set out in a largely inaccessible patchwork of primary and secondary legislation. The vacuum created by this absence of a readily accessible statutory framework is currently in the process of being filled through a variety of well intentioned initiatives taken by local government bodies, interest groups and responsible employers, thus adding further layers of regulation and complexity to the existing regime. Although the new Labour Law will re-enact the existing health, safety and welfare provisions of the Labour Law (Federal Law No.8 of 1980), importantly, there is provision for the MOL to "prescribe the general precautions and health protection measures" applicable to all places of work. Thus, the new Labour Law presents the MOL with a welcome opportunity to consolidate the existing regulatory regime.

In addition, there is little doubt that the legal regime would benefit from a review in the light of advances in health and safety practices since 1982. One notable example is the current regime's focus on the responsibilities of contractors, largely neglecting the contribution to be made to health and safety by other project participants, particularly developers and consultants. Disappointingly, the draft Labour Law does not address this shortcoming, an omission that will need to be corrected if the stated objectives of the draft Labour Law are to be achieved.

Assessment

If the new Labour Law is brought into effect, as currently predicted towards the end of the year, its short term impact on the labour market will be modest. The reforms, if not surgical, are nevertheless, targeted at addressing specific issues, specifically those that have made the headlines over recent years. However, before the success of the new Labour Law can properly be gauged there is much work to be done by the Ministry, hopefully with the involvement of the industry, on preparing the various implementing regulations.

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