US embassy cable - 05DUBAI334

C O N F I D E N T I A L SECTION 01 OF 03 DUBAI 000334 
 
SIPDIS 
 
USTR FOR DOUG BELL 
 
E.O. 12958: DECL:  1/24/2015 
TAGS: ELAB, ETRD, PHUM, TC 
SUBJECT: UAEG OFFICIALS AND OTHERS TELL A/USTR CLATANOFF LABOR 
DISPUTE PROCESS WORKS 
 
REF: ABU DHABI 296 
 
 
CLASSIFIED BY: Jason Davis, Consul General, Dubai , UAE. 
REASON: 1.4 (b), (d) 
 
 
 
1. (C) Summary: In a January 18 visit to Dubai, Labor A/USTR 
Clatanoff spent over two hours at the Ministry of Labor 
observing the Ministry's labor dispute process. MinFin A/US 
Khalid Al-Bustani told Clatanoff that labor was receiving 
attention "all the way to the top" of the UAEG. In a meeting 
with Emirati labor attorneys, Clatanoff was told that Dubai 
courts handle labor disputes quickly, most often siding with the 
employees. The Philippine Labor Attache told Clatanoff that "as 
an institution, the Ministry of Labor is fair." End Summary. 
 
Labor U/S Meeting 
----------------- 
 
2. (C) Following his meetings in Abu Dhabi (ref A), Assistant 
United States Trade Representative for Labor William Clatanoff, 
accompanied by Dubai PolEconoff (notetaker), spent January 18 in 
meetings in Dubai focusing on how current UAE labor laws are 
enforced. Clatanoff spent the morning at the Dubai branch of the 
Ministry of Labor, first meeting with Ministry of Labor U/S 
Khalid Al Khazraji and Salem Al Muhairi, Director of the MoL's 
International Relations Department. U/S Al Khazraji emphasized 
to Clatanoff that the UAE had worked with a team of ILO experts 
when first crafting its Labor Law of 1980, and had only amended 
a few articles since then. A revision to the labor law is 
currently being drafted; proposed changes are reported septel. 
 
3. (C) U/S Al Khazraji read off a few of the MoL's labor 
statistics. He said that in Dubai most disputes involved unpaid 
wages, adding that of these unpaid salary complaints, about 60 
to 70 percent were from construction workers. Al Khazraji said 
that the number of complaints in 2004 was actually lower than 
that in 2003, and pointed to this decrease as a sign of 
improvement. He said that while there were about 2.3 million 
workers under the MoL's jurisdiction, complaints were filed by 
only 16,400 people, UAE-wide, in 2004. (Note: The Labor Law does 
not cover government workers, domestic servants, or agricultural 
workers.) Of these complaints, around 5,600 were related to 
unpaid salary and 4,300 to termination of contract. MoL, he 
said, was able to settle most complaints in-house through 
mediation: about 10,000 were concluded by the MoL, as opposed to 
only 1,800 referred to court; another 3,500 complaints were 
withdrawn or settled outside of either the mediation or court 
process. Al Khazraji explained that most people preferred the 
MoL process to a court case, in part because MoL was faster than 
the court system. 
 
4. (C) Al Khazraji said that of the workers who had gone on 
strike (i.e. stopped work en masse and filed a complaint with 
the MoL), around 95 percent were from the construction sector. 
Al Khazraji said that nothing in the law specifically forbade or 
authorized strikes, but that in practice the government allowed 
them. When a group of workers stopped work, MoL asked them to 
choose one representative to negotiate on their behalf. 
 
Ministry of Labor -- Disputes and Inspections Departments 
--------------------------------------------- ------------ 
 
5. (SBU) While touring the Ministry and observing the dispute 
process first-hand, Clatanoff met with Labor Public Relations 
Acting Manager Jassim Al Banna. Al Banna explained the labor 
dispute process, noting that the complaints must be filed in 
Arabic and that labor complaints must be filed at the MoL before 
being referred to court. He said that a number of shops had been 
set up outside the MoL to help workers draw up their complaint, 
for a fee, and that at the MoL itself there were typists who 
would take down a worker's oral complaint. Supporting documents 
could be submitted in any language. After the employee or 
employer filed the complaint, one of the ten Legal Advisors 
(basically a Labor Officer) was assigned to the case. The 
Advisor called in both sides of the dispute (with no lawyers 
allowed) and gathered information such as bank receipts and 
other documents. While the law gives the MoL only two weeks to 
either resolve the dispute or refer it to court, Al Banna said 
that this schedule was "unrealistic" and that a month was a more 
reasonable timeframe. (Note: MoL said that this timeframe would 
be changed to 30 days in the labor law revision. End note.) The 
Legal Advisor reviewed the case and recommended a solution, in 
fact acting as a mediator. The Legal Advisor's recommendations 
were non-binding, and at any time in the process either party 
could demand that the case be turned over to the courts. When 
this occurred, the Legal Advisor sent his recommendation, along 
with the entire file, over to the Dubai Courts Department. 
 
6. (C) Al Banna described how a foreign worker had to get a No 
Objection Certificate (NOC) from his/her employer if he wanted 
to change jobs. Workers who quit their jobs before their 
contract was up are subject to a six-month to one-year ban on 
getting a new work permit for the UAE. Clatanoff asked if, in an 
unfair dismissal case, the worker was required to leave the 
country (since his residency is contingent upon his employment) 
or if the MoL could let him stay in the country and perhaps even 
work somewhere else. Al Banna replied that the Legal Advisor 
first tried to persuade the company to allow the worker to be 
reinstated or allowed to work elsewhere, but if that failed, the 
worker was at least entitled to damages. If the case went to 
court, the worker could apply to get work permission for the 
duration of the case, and the employer was not able to block him 
from receiving it. 
 
7. (C) Director of the Labor Inspections Department Abdulla Bin 
Suloom reported that his 95 inspectors checked for health and 
safety, "labor checking" (NFI), work permission, and 
investigation/follow-up. He claimed that MoL does do surprise 
inspections. The fine for employing a worker illegally (such as 
when the employer is not the sponsor of record) is 10,000 AED 
(2,725 USD) per worker. Bin Suloom said that the number one 
problem he encountered was illegal workers, who were generally 
runaways from their original sponsors and working elsewhere. He 
said every firm with 50 or more employees needed an MoL 
certificate, and the MoL was required by law to inspect every 
company twice a year, though Bin Suloom called this "impossible." 
 
Meeting with Khalid Al Bustani 
------------------------------ 
 
8. (C) In a brief meeting with Khalid Al Bustani, MinFin A/US, 
who backs up MinState Finance Khirbash and is our principle UAEG 
working level FTA contact, Clatanoff emphasized that the three 
main labor issues were underage camel jockeys, freedom of 
association, and the right to organize and bargain collectively. 
Al Bustani explained that sometimes, from the perspective of 
someone from the Ministry of Interior or other security-related 
positions, the question is, if they have the right to 
association, how do you control them? As an example, Al Bustani 
cited UAEG concern -- given the huge Indian and Pakistani 
populations in the UAE (often estimated at half the population 
of the country) -- when tensions between India and Pakistan 
suddenly flared up. "We were worried here, but they (the Indian 
and Pakistani communities) weren't able to mobilize -- if they 
had organizations, they would have been able to gather," and 
trouble would likely have resulted. Al Bustani reassured 
Clatanoff that labor had a very high level of attention in the 
UAEG "all the way to the top. The President, the Crown Prince -- 
everyone is following this." 
 
Meeting with Private Sector Labor Attorneys 
-------------------------------------------- 
 
9. (C) Clatanoff met with three Emirati attorneys, two of whom 
specialized in labor cases, in order to find out how the courts 
handled labor cases. The attorneys reported that they were quite 
happy with the courts and the way the system was working. For 
example, whereas normally a court fee is levied equal to 7.5 
percent of the claim, for labor cases there were no fees. 
Moreover, they said, court cases are adjudicated quickly, 
especially in Dubai. While a normal court case might require 
four to six weeks between hearings, labor cases have only about 
a week gap, because they are expedited. One attorney reported 
that he had recently won a labor case against a sheikh, and that 
the court's ruling had been carried out without a hitch. The 
lawyers all agreed that courts generally ruled more often in 
favor of workers. Clatanoff asked if they had ever heard of 
Article 181 of the Labor Law, which provides for penalties of 
six months' prison and/or a fine from 3,000 to 10,000 dirham 
(about USD 825 to 2725), being applied to employers of underage 
camel jockeys. Though Article 20 bans child labor, none of the 
lawyers had ever heard of such a penalty being used. 
 
Meeting with Philippine Labor Attache 
------------------------------------- 
 
10. (C) Vicente Cabe, Labor Attache at the Dubai Philippine 
Consulate General, said that the UAE had good labor laws, though 
he noted that they were not applicable to domestic servants. 
"And something is missing in enforcement," Cabe added. He said 
that there was no systematic problem in which the government 
sides with its own citizens, as he had seen in other countries. 
"As an institution, the Ministry of Labor is fair -- only 
certain individual employees there favor their countrymen," Cabe 
told us. Clatanoff pointed to Article 128 in the Labor Law, 
which prohibits workers from changing employers if they leave 
their contract without a "valid reason." Cabe said that this 
prohibition was applied across the board, regardless of the 
reason the employee left, and thought the UAE should judge these 
reasons on a case-by-case basis. According to Cabe, most of 
these problems are not large and do not need new laws. 
"Ministerial orders are very easy and really change things," 
Cabe recommended. 
Comment 
------- 
 
11. (C) A close examination of how the labor dispute process 
works in practice reveals that the UAEG is both doing a credible 
job and striving to improve. Workers who bring their disputes to 
the Ministry of Labor or to the courts have access to justice 
and receive full due process. The main barrier to an FTA on the 
labor front is not the MoL or the courts, but the three issues 
of forced and underage employment for camel jockeys, the legal 
rights of organizing and bargaining collectively, and freedom of 
association. 
 
DAVIS