New Agreement for Indian Domestic Workers in Saudi Arabia

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Dec 17 2014

The new contract was announced shortly after GCC states reneged on commitments to implement a unified standard contract for domestic workers

After over a year of negotiations, Saudi authorities have finalized a standard contract for Indian domestic workers. The contract, part of a wider labor pact with India signed in early 2014, is limited in scope but does define some rights and responsibilities of both employers and employees; one positive stipulation is a renewed commitment to enforcing the “bank guarantee” which requires employers to deposit 2500 USD with the Indian embassy. The guarantee applies only to female domestic workers and is returned to the employer after contractual obligations are met or used in the case of abuse or nonpayment of salary.  Since 2007, India has negotiated similar requirements for domestic workers across the Gulf states.

Saudi press widely criticized the insurance guarantee as an “obstacle” to the recruitment of Indian domestic workers. The Indian consulate in Jeddah also noted that the new rule may reduce the number of applications they receive. However, in October Saudi authorities standardized recruitment fees to SR2,000, incentivizing employers to use formal recruitment avenues.  The agreement also includes a list of 27 approved recruiters, in order to help workers and employers "avoid being trapped by fake agencies."

The new agreement also stipulates a minimum wage of SR1500, which employers are required to deposit in workers’ bank accounts each month.  The new requirement matches the USD400 minimum wage for Filipino domestic workers that was agreed upon last year.  Though the Kingdom announced minimum wages for all domestic workers, set at SR600-SR800 in 2012, in practice wages continue to vary due to weak regulation and enforcement.

The Saudi Cabinet issued a brief comment regarding the new agreement, which stipulates that domestic workers may not have criminal records, and that they receive training in specialized centers prior to departure. Additionally, workers must "be educated about the traditions and culture of Saudi Arabia" and informed of the nature and terms of their work contracts. All future contracts must be approved by the Foreign Ministry and Chamber of Commerce and Industry, as well as either the Indian embassy or consulate.

Incomplete Reform

Though the standard contact provides for important changes, it is not comprehensive; for example, no maximum daily working hours are set. Currently, Saudi laws only require 8 hours of daily rest, permitting up to 16 hours of daily work. The agreement also does not guarantee workers’ freedom of mobility during off-time nor private access to communication, essential for workers to access complaint mechanisms from the embassy or Saudi hotlines.  The monitoring and enforcement mechanisms are also unclear.

The new contract comes amid wider reforms to Saudi’s domestic labor sector, though agreements with other counties including Indonesia and Nepal have stalled. Earlier this year, Saudi Arabia failed to reach an agreement to lift the 2011 ban on the recruitment of Indonesian domestic workers, rejecting Indonesia’s demand to set the minimum wage at SR1200  for female domestic workers and SR1500 for males. Though the Indonesian labor committee has not been transparent about the negotiations, they confirmed their demands included setting maximum working hours and rest days.

Similarly, "the Saudi side's reluctance to keep explicit provisions" has also hampered agreements with Nepal. Nepal requested a minimum wage of USD300, the establishment of a community outreach centre for domestic workers, guaranteed leave, as well as decent food and accommodation facilities. This year alone, the Nepalese embassy has rescued 300 domestic workers from abusive employers this year alone, and estimates that currently 40,000 undocumented Nepali women work in the Kingdom.

Authorities finalized the standard contract for Indian domestic workers following the failure of Gulf countries to implement a unified contract for domestic workers. Though GCC labor ministers purportedly agreed on minimum standards to regulation the recruitment and rights of the region’s 2.4 million domestic, no actual standard unified contract was created. A Kuwaiti Interior ministry official noted that the agreements have no value unless legislated at the national level, especially as the ministry of interior is responsible for domestic worker issues.

Earlier this year, the Saudi labor ministry announced plans to issue 100,000 visas for Indian domestic workers in 2015. There are currently an estimated 500,000 Indian domestic workers in the Kingdom, of which 10% are female. The kingdom hosts an estimated 1.5 million domestic workers in total.

Advancing the rights of migrant workers throughout the Middle East