2
THE ISSUE OF WAGE THEFT
According to the World Bank, in 2020 remittances are predicted to decline by 20% – which is about
$109 billion3. A leading World Bank economist highlighted that fall in wages and employment of migrant
workers due to COVID-19 are the key factors for this decline. Amongst other factors, wage theft is also
a significant contributor4. Decline in remittances is certain to impact the economy of low-income
countries. The effect is also significant at the individual level for the families of migrant workers who
are dependent on remittances for their livelihood. Additionally, migrant workers also take on debt to
pay recruitment costs associated with migration. Decline in remittances and possible job losses could
lead to defaulting on their debts pushing them further into poverty, forced labour and debt bondage.
The Business and Human Rights Resource Centre (BHRRC) has been recording cases of labour abuse of
migrant workers in the GCC countries since 2016. Their record indicates that wage theft is the most
commonly reported abuse – sited in 80% of the cases documented. During this time of pandemic, the
BHRRC documented almost 400% more cases of abuse compared to the same period in 2019 – of which
77% is related to non-payment of wages due to employers citing economic downturn.
In most cases of wage theft, the victims are vulnerable workers with precarious legal status and lack
the knowledge and capacity to seek wage recovery. Recovering wages through state-led judicial
mechanisms during normal times was already challenging – pertaining to costly and drawn out
processes. During this crisis, the situation has worsened with courts shutting down or moving online.
Lack of freedom of association, fear of reprisal from companies, lack of accountability of businesses,
inadequate protection from labour laws and complicated legal systems – are some of the key barriers
for migrant workers to seek remedy for their claims.
The crisis has exposed the vulnerabilities arising from exclusion of migrant workers from the industrial
relations system. Most countries of destination in the Gulf do not legally allow migrant workers to either
organise themselves or to join trade unions, restraining them to advocate for their rights and wellbeing.
In the absence of trade unions and worker represented committees, migrant workers are deprived from
expressing their grievances related to stolen wages and labour abuses.
During this pandemic, there is very little evidence in the Middle East and in Asia to show that businesses
have taken proactive measures to ensure migrant workers are duly compensated before repatriation.
Businesses out of their responsibility to respect human rights need to put systems in place to prevent
human rights abuses, including wage theft and concerns of forced labour, and should provide effective
remedy if it occurs.
3
https://www.worldbank.org/en/news/press-release/2020/04/22/world-bank-predicts-sharpest-decline-of-remittancesin-recent-history
4
Reflections at a webinar organised by MFA, CCRM and GRFDT on 21 August 2020