A new provision by the UAE Minister of Labor stipulates that from January 1 2011 a new employment permit will be granted immediately after a work contract expires eliminating (if the contract ends amicably) the six-month period mandated so far to get a new contract in the country. It is a measure that makes the labor market more efficient and alleviates the many constraints and imposition on employees in the UAE. In any case it is simple common sense.
Not so for the employers. Their representatives gathered at the Ministry of Labour to protest against this reform that merely removes anachronistic provisions that have few analogies in market economies. This is an example of the arguments brought about by the protesters, taken from the local press: "After this news came out, our employees started threatening that they can leave as soon as their contracts are finished and not worry about the six-month ban," said Naima, an engagement administrator from an audit company in Abu Dhabi who did not want to give her last name. "We used to have control over them, and we knew it wasn't easy for them to go, now we will lose this control."
That is right! Some employers demand control over their employees. It is intolerable that they might decide to leave! Who do they think they are?
Others were upset that dropping a year on the duration of labor contracts has the practical consequence that companies have actually to pay end-of-service payments. According to Mohamed, a manager at an airline, who joined the protesters but preferred to remain anonymous when interviewed by a journalist: "This is really bad news; this means we will have to pay our employees their end of service payments at the end of their contracts after two years. We didn't have to pay much before because they always left before the three years. This means we will lose a lot."
These remarks shed some light on business that have made a habit (and a lucrative one) of making life tough for their employees in various guises so to force them to resign and deprive them of their end of service compensation. Unfortunately it will take more than a palliative to enforce contractual obligation in a fair way but the changes from January 1st are a small step in the right direction.