Contractors working in Qatar will need to update their employment contracts, and can expect tougher competition in attracting labour, thanks to a new law that guarantees a minimum wage and makes it easier to change employers, a law firm says.
Coming into effect 9 October this year, Law No. 17 sets the minimum wage at QAR 1,000 per month ($275), plus QAR 500 per month ($137) for accommodation and QAR 300 per month ($82) for food.
It also removes the requirement for foreign workers to obtain a No-Objection Certificate (NOC) from their employer to work for someone else.
Law firm Pinsent Masons warned that all employment contracts will need updated where workers currently earn less than the minimum wage.
Competition for labour would also rise with workers now more free to change employers.
It said site productivity could improve because of the increased competition and incentives to perform.
But it said contractors should investigate whether increased costs incurred as a result of the new law are recoverable under the "change in law" provisions in their contracts.
"The labour market will experience greater competition since employees can change employers, and employers can attract the best talent in the local market," said Pamela McDonald, senior associate with Pinsent Masons.
She said other contractual or legal complexities may also arise, for example if the contractor is in delay as compared to the contractual completion date.
In those circumstances, the contractor will need to establish its entitlement to recover any amount, including any increased minimum wage costs, in relation to periods of delay.
Image: Migrant workers in West Bay, Doha, Qatar (Alex Sergeev/www.asergeev.com/CC-BY-SA-3.0)