Engineers Against Poverty at International Labour Organization consultation: tackling delayed payment and unsafe conditions affecting construction workers

Engineers Against Poverty recently participated in an International Labour Organization (ILO) consultation on labour migration and mobility from Asia and Africa to the Middle East. The consultation brought together representatives of governments, social partners, civil society from 22 countries to exchange experiences, assess key challenges and propose technical and practical ways to ensure fair migration in the interrelated regions.

Dr Jill Wells, Senior Policy Adviser for Engineers Against Poverty, delivered a keynote address during a session on ensuring decent working conditions. Here, she focused on why and how we must address delayed payment and unsafe working conditions affecting migrant construction workers in the Middle East.

“The majority of migrant workers in the region find themselves in debt due to flawed recruitment processes in place, and so when they experience late or non-payment its impact is severely felt,” explained Dr Wells. She continued, “Even a short delay in receiving wages affects migrant workers’ capacity to send remittances home and to reimburse their debt, so the interest mounts up causing a significant stress.”

Dr Wells outlined that the common cause of delayed payments, namely, the complex subcontracting chain in the construction sector, the outsourcing of labour employment and a flawed system where a contractor relies on payment in the tier above in order to pay subcontractors in the tier below.  This system, known as ‘pay when paid’, often leads to late payment in small firms with limited financial reserves.

One of the measures countries in the Gulf Corporation Council have taken to address wage delay is by introducing a Wage Protection System, which keeps an electronic record of payments. During the ILO session, a panel member outlined developments to Saudi Arabia’s Wage Protection System including a database that allows for automatic payment of wages and monitoring and disciplinary measures for non-compliant employers. The panellist also pointed to new legislation that allows workers to leave their employer without seeking authorisation if they have not been paid.

Whilst welcoming these measures, Dr Wells stressed that they still do not address the key flaw in the ‘pay when paid’ system; that employers will still experience limited access to funds when their employees’ wages are due. To address the root cause of the issue, Dr Wells outlined that legislation should be introduced to encourage prompt payment and ban ‘pay when paid’. Such legislation has been adopted in the USA (USA Prompt Payment Act, 1982) and the UK (UK Construction Act, 1996) and is followed by Singapore, Malaysia, New Zealand and others. In addition, project bank accounts, which are ring-fenced accounts ensuring those in the construction supply chain are paid on time, can offer some protection for the workers against insolvency in the subcontracting chain.

The second issue Dr Wells focused on concerned the poor occupational safety and health of migrant workers in the region. This can also be attributed to flaws in the subcontracting process and, more specifically, to the outsourcing of labour to small firms. Small firms have limited capacity and understanding of the occupational safety and health of workers, yet they are still held responsible for ensuring it. Therefore, measures must be put in place so that responsibility is shared among those from different employment tiers, so that direct employers, principal contractors and clients are held jointly liable. In addition to this, countries should focus on implementing comprehensive occupational health and safety policy and strengthening their labour inspectorates.

Delayed payments and poor health and safety measures are catastrophic for migrant workers, furthermore, they have a detrimental impact on the timeframe, cost and quality of construction projects. With significant investment planned in the construction sector in the region, as well as major events such as the 2022 FIFA World Cup in Qatar on the horizon, these concerns are even more pressing as many migrants enter the region and seek employment.

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