Non-payment of wages: An issue on the rise for low-income migrant workers in Bahrain

13 min read

Earlier this year, HSBC's Expat Explorer Survey ranked Bahrain the second-best - Opens in new tab place in the world to live and work in as an expat because of “attractive salary packages, earning potential and solid benefit packages.” In March, Forbes also ranked - Opens in new tab Bahrain the second-best place in the world for women to work abroad, based on an InterNations expat survey. Government officials and local media widely celebrated these international accolades.

But it’s clear that lower-income migrant workers were not the ‘expats’ surveyed for these reports. Their realities differ greatly from the rosy picture painted in the media; austerity measures, economic downturn and rising living costs mean that more and more lower-income migrants are living precariously in Bahrain. Recent reforms to the labour migration system are limited in practice and have largely failed to protect migrant workers at the bottom of the social pyramid.

This report reviews the issue of non-payment of wages that migrant workers in Bahrain increasingly face, and assesses the Bahraini government’s response.

Non-payment of wages on the rise

The economic downturn, caused mainly by low oil prices, hit Bahrain’s construction sector hard and exacerbated the already rampant practice of non-payment of wages. Costs and losses are passed on to the most vulnerable – the migrant workers at the end of the supply chain.

A recent ILO study - Opens in new tab on construction workers in the region found that “many contractors relying on short-term funding were reported to be feeling an impact on their working capital and their ability to repay debt, and several companies working on government projects reported having difficulty paying wages to their workers.”

Over the past several months, workers from different sectors have staged protests across Bahrain over unpaid-wages and poor working conditions, though only a few of them have received media attention.

The rising number - Opens in new tab of non-payment of wages cases prompted a discussion at the Shura Council in March 2019 - Opens in new tab, where council member Mona Al-Moayyad highlighted - Opens in new tab the plight of many migrants who have not been paid and demanded that action be taken against companies that fail to pay wages.

On December 4, 2018, more than 300 workers of Bahrain Motors Company, a construction firm, protested at the company’s headquarters in Hafeera after not being paid for four months. The protestors were intercepted by the police and sent back to their labour camp. One worker told the Gulf Daily News - Opens in new tab (GDN) that “there are Indian, Pakistani and Bangladeshi workers who have not received their salaries for four months now… we have no money and it’s difficult to survive.”

The Migrant Workers Protection Society delivers food to stranded Bramco workers.

Non-payment of wages is not an issue restricted to the construction sector. On January 6 2019 - Opens in new tab, a group of workers from Mirador Hotel in Manama protested and filed a complaint after eight months of nonpayment. On September 25, 2018, hundreds of workers from Ramses Trading Company protested against several months of unpaid wages. Some workers MRRORS.org spoke to were not paid for nearly six months. The protests were dispersed by riot police.

In March 2019, Jameel Humaidan, the Minister of Labour and Social Development, reported - Opens in new tab that 2,863 employees working in 18 different private companies had filed complaints for overdue wages, some with six months of owed wages. The minister argued that “18 violators isn’t a huge number,” but vowed to take legal actions against the companies that fail to pay their workers.

Ramses trading company workers protest against several months of unpaid wages (September 2018)

Spotlight: Stranded workers from three large companies protest non-payment

G.P Zachariades

On January 15, 2017, workers from the G.P Zachariades construction company took to the streets to protest against months of unpaid wages. Police broke up the protest, and one man, Indian national Narayanan Pitchai, was left dead after allegedly being shot by a teargas canister - Opens in new tab.

The G.P Zackhariades case has dragged on for over two years now. The company is owned by Cypriot Stefanos Zachariades and has delayed payments for around 1500 workers. Hundreds of workers from the company had gone on strike in January 2017 - Opens in new tab and again in December 2018. The government’s slow response may be due to its own involvement in the problem; G.P. Zachariades’ main client was the Bahraini government itself. One source - Opens in new tab close to the company claimed that the Bahraini government has not paid dues of up to BD57 million (USD151 million), putting the company in severe financial crisis.

In December 2018, Sabah Al Doseri, undersecretary of Ministry of Labour and Social Development (MLSD) told GDN - Opens in new tab that talks are still ongoing with the company and that the government managed to reduce the number of affected workers from 1500 to 200. “The matter would be finalised soon,” he added.

But the conditions of the stranded G.P Zachariades workers only deteriorated. On March 6 2019, - Opens in new tab after up to two years of non-payment, surviving on one meal a day and suffering from illnesses and lack of medical care, the workers staged another protest. They blocked the main highway near the company’s labour camp before being dispersed by riot police forces.

The police arrested 11 migrant workers (six Indians, five Bangladeshis and one Pakistani) for blocking the highway and detained them at Al Eker detention centre ahead of deportation. Their embassies provided little support. The Labour Consul of Bangladesh Embassy told the GDN - Opens in new tab that “they have broken the law of the land by staging the protest on a major highway and we do not defend the act, and that “they “will have to face the consequences. We assume that they will face trial and the (Bangladesh) embassy has no lawyer to deal with such cases.”

Yet, even G.P. Zachariades employees who did not protest risked deportation. The company has not renewed workers' visas, rendering their status illegal. In March 2019, GDN - Opens in new tab reported that some have already been deported due to their irregular status.

As of September 2019, company assets are being auctioned off - Opens in new tab to pay workers' wages.

Bramco Group

The Bramco Group case demonstrates how a cut-throat private sector environment under the Kafala results in even non-Bahraini transnational elites participating in the exploitation of migrant workers. Bramco Group - Opens in new tab is a mining conglomerate that operates throughout the Gulf and India. Some of the company's projects - Opens in new tab include the stonework design and flooring on the Indira Gandhi International Airport's Terminal 3 and granite mining activities in Saudi Arabia. In 2013, the Economic Times - Opens in new tab reported the company’s annual turnover was USD 150 million. Bramco is owned by Indian businessman Vinay Kumar Dewan - Opens in new tab and his daughter Kanika Dewan - Opens in new tab presides over the company.

Kanika a Wharton business school alumni, a professed “campaigner against corruption - Opens in new tab” recognised as one of the young global leaders - Opens in new tab by the World Economic Forum in 2016. She spoke - Opens in new tab on the “importance of doing business ethically.” Meanwhile, workers in the company she presides over are subject to exploitation and abuse.

In February 2019 - Opens in new tab, the MLSD lodged a case against Bramco Group after the mining conglomerate failed to pay the wages of over 100 of its workers for several months. Some workers haven’t been paid for over 14 months, and most of their visas have expired. They live in deplorable conditions, surviving on handouts from Embassies and civil society groups like Migrant Workers Protection Society (MWPS).

One of their employees, 61-year-old Abdul Ghaffar Karvekar suffered a heart attack and died in Dubai while being repatriated to India.

Sabah Al Doseri told GDN - Opens in new tab, “We have been giving the owner the time he asked for to settle salaries to his employees. Once he kept his word and paid part of his employees’ wages, but then it ended up getting worse and now we learn he is not in Bahrain.”

Dewan has repeatedly ignored calls to return to Bahrain in order to settle the case.

Sonar and Zone Security W.L.L

Around 200 unpaid migrant workers from two security companies owned by Yousif Al Zayani were stranded in desperate conditions for over six months. The companies provided security services for various Al Zayani establishments across Bahrain, including Hyundai cars Showroom in Bahrain. The workers of Sonar Security W.L.L and Zone security W.L.L told MR that after months of delayed payments and several protests, the manager of the company finally provided every worker with a cheque for their due wages. But when the workers went to the bank to cash the cheque on November 5 2018, they were told the sponsor’s account did not have sufficient funds.

The workers staged a protest on the same day, marching to Khamis police station to lodge a complaint against their sponsor. A group of these workers spoke to MR. They said that when they returned to their labour accommodation, the owner’s son appeared with a group of eight people and started threatening and beating them. When the situation escalated the police arrived and detained nine workers who were accused by the manager of threatening him with knives and sticks. The workers were released the next morning due to lack of evidence.

On January 5 2019, Rajendra Bahadur KC, a Nepali worker from Sonar Security, succumbed to a heart attack after a heated argument he had with his employer earlier in the day. “We found him on the ground a few hours after the employer left. We immediately called the ambulance but it took the ambulance 40 minutes to arrive and by the time he was taken to Salmaniya Hospital, he was pronounced dead,” according to the deceased’s colleague.

The stranded workers, who are mostly from Bangladesh and Nepal, said that their cases have been referred to the labour court and that their respective embassies were aware of the situation but they have heard little from them. One worker said that many stranded workers have started to work for daily-wages with different subcontractors around Bahrain just to survive, while other workers relied on migrant community groups for food and support.

MRRORS reached out to the companies but received no response from them. These were the questions addressed to them by email:

How many migrant workers are employed in your company?

Has there been any final pay settlement to the non-payment issue as of yet?

When and how is the company planning to repay and compensate its unpaid employees?

What was the reason that led to the company to default on wages in the first place?

Is the company still active in projects at the moment?

Minimising the volume of complaints does not take into account the larger impact of even one worker losing one month's of wages; Migrant-Right.org’s interviews with workers in similar situations across the GCC reveal that delayed wages not only mean workers struggle to survive in their country of employment, but that their families back home also suffer; if they are unable to send wages back, school fees are unpaid, food can’t be purchased, and debts - often related to recruitment - cannot be repaid.

"… we have no money and it’s difficult to survive."

Furthermore, the number of official complaints do not represent the scale of the issue. Many workers put off lodging a complaint in the hopes that their employer will soon pay their past-due wages. When workers do attempt to complain, the ministry usually attempts to negotiate with the employer before taking the issue to the labour courts.

Workers working irregularly are also likely to avoid filing complaints out of fear of arrest and deportation.

The consequences of Non-payment of wages and the government’s response

Non-payment of wages, financial difficulties, miserable living and working conditions lead to what Bahraini scholar Abdulhadi Khalaf calls the “vicious cycle of poverty,” - Opens in new tab which subjects migrant workers to immense stress and drives some to take their own lives - Opens in new tab. According to media reports, 37 migrant workers - Opens in new tab committed suicide in Bahrain in 2018. This is not an official figure and does not include failed suicide attempts.

Aruldas Thomas, the Chairman of the Indian Community Relief Fund in Bahrain (ICRF) told GDN - Opens in new tab that 18 of the 23 Indian migrants who committed suicide in 2018 were victims of non-payment of wages. As of October 2019, at least 29 migrants - Opens in new tab have committed suicide according to local media reports.

The rising number - Opens in new tab of suicides has prompted migrant community groups to set up suicide prevention initiatives. The Indian Community Relief Fund (ICRF) conducted training programmes - Opens in new tab for more than 100 volunteers to provide support hotlines and counselling assistance to migrant workers.

The Bahraini government has not yet released any official data on the total number of non-payment of wages cases received in 2018. However, according to GDN - Opens in new tab there were 1,760 non-payment of wages handled by the government in 2017, up from 276 in 2013. In response to the rising number of non-payment of wages cases, the government temporarily expanded the Flexi-Permit scheme to include workers who have not received their wages and who have filed a complaint at the labour court. “Anyone who has not been paid or has a pending case related to non-payment of wages can also avail of the facility,” Ausamah Al Absi, CEO of the Labour Market Regulatory Authority (LMRA), told the GDN - Opens in new tab.

18 of the 23 Indian migrants who committed suicide in 2018 were victims of non-payment of wages.

But the high cost of the Flexi-Permit scheme means it is not affordable for most workers - especially those who have not been paid for several months. In February 2019, the government increased - Opens in new tab the scheme's initial payment fees from BD 449 (USD 1190) to BD 749 (USD 2,000).

The Wage Protection System: A solution to Non-Payment of wages?

Bahrain is the last GCC country to adopt a Wage Protection System (WPS). The government announced plans to implement WPS for companies with 500 workers or more in April 2019 - Opens in new tab, but delayed until September 2019. The WPS is currently in an experimental phase with larger companies.

The WPS makes it mandatory for employers to pay wages through bank transfer and will alert the government of delayed or unpaid wages. The LMRA’s Al Absi said - Opens in new tab that the WPS will be implemented in different phases and gradually cover all workers.

Al Absi told told GDN - Opens in new tab,“the Wage Protection System will put an end to the exploitation of workers as giving out cash business (as wages) will be stopped.”

The WPS is a step in the right direction that could provide greater transparency and efficiency in detecting and resolving payment disputes. However, the system is unlikely to eradicate the delays and unpaid wages on its own. MRRORS previously covered key issues that Bahrain needs consider when rolling out the WPS, and how WPS failed to flag non-payment and protect workers against non-payment in the other GCC countries. Even with a WPS system in a place, migrant workers can still be left without their due if their employer leaves the country or declares bankruptcy before paying their wages. Employers in Bahrain can also cancel workers visas without notice if the worker is outside of the country, enabling them to avoid paying any owed wages.

It is imperative for the Bahraini government to establish a comprehensive framework that protects low-income migrant workers from these practices. Key recommendations include:

Implementing the steps proposed by the ILO - Opens in new tab to combat late or non-payment of wages.
Expanding the WPS to include all workers, and not just workers of large companies.
Improve responses to complaints and assist unpaid migrant workers in filing wage dispute claims by providing translators and lawyers.
Cease arrest and deportation of migrants who protest or become irregular due to non-payment of wages and allow migrant workers to more easily change employers.
Trade unions in Bahrain can also work together to encourage migrant workers to unionize and establish a form of collective bargaining that would have an effect on employer practices.

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