New Law on Minimum Wage

New Law on Minimum Wage

INTRODUCTION

On 30 August 2020, His Highness the Amir Sheikh Tamim bin Hamad Al Thani enacted Law No. (17) of 2020 regarding the Minimum Wage for employees and domestic workers (the “Minimum Wage Law”).

WHAT SHOULD YOU KNOW ABOUT THE MINIMUM WAGE LAW?

The Minimum Wage Law applies to the following categories:

A. All private sector employees (i.e. every natural person who works for an employer and is subject to the employer’s guidance and supervision); and

B. Domestic workers (i.e. domestic workers who perform household duties under the supervision and management of the employer such as chefs, housekeepers, drivers etc.)

The Minimum Wage Law gives the Minister of Administrative Development, Labour and Social Affairs Ministry (“Ministry”) the authority to set the minimum for the abovementioned categories by a ministerial decision which shall be reviewed and amended at least once a year by a specialized committee to be formed. The decision is required to take into consideration the economic factors including the economic development, competitiveness, productivity and the needs of the employees and their families.

On 30 August 2020, the Ministry issued a press release in relation to the Minimum Wage Law confirming that the Minster has issued a decision (“Ministerial Decision”) to set the minimum wage at QAR 1000 (One Thousand Qatari Riyal) per month. In addition, the Ministerial Decision provided that in case the employer does not provide the employee with adequate housing and food, the employer must provide the employee with the following allowances:

1. Minimum of QAR 500 (Five Hundred Qatari Riyal) per month for accommodation expenses; and

2. Minimum of QAR 300 (Three Hundred Qatar Riyal) per month as food allowance.

WHAT SHOULD EMPLOYERS DO?

1. The Minimum Wage Law obliges employers who currently pay employees a salary below the minimum salary pursuant to the Ministerial Decision to amend the salary as well as the employment contracts of the concerned employees in order to comply with the minimum wage and related allowances set in the Ministerial Decision. Employers are given six months from the date of publication of the Ministerial Decision to ensure compliance with its mandates. Moreover, any agreement between the employee and employer to the contrary shall be void.

2. In cases where the monthly salary earned by employee is not specifically determined and the total amount the employee earns per month is below the minimum salary announced by the Ministry, the employer shall give the employee an additional salary equivalent to the difference between what the employee earns and the minimum wage set by the Ministry.

PENALTIES

In case of a violation by the employer to any provisions of the Minimum Wage Law, the Ministry is entitled to suspend all of the employer’s transactions whether he/she was a natural or legal person.

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