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Qatar postpones mandatory online wage payment system

Qatar has postponed the launch of an online wage payment system for low-income workers in the private sector, The Peninsula said19 Aug 2015

The wage protection system (WPS) was due to launch today, six months after the law was put in place. However, the government has given companies until 2 November to comply because many were not ready, the newspaper said.

Under the law, over 50,000 private companies will have to begin paying wages through banks. Banks have been asked to open accounts for all workers who are to be paid through WPS, no matter how low their salary, The Peninsula said. Workers should be able to withdraw money fee of charge up to five times a month.

Companies must create CSV files to save worker data and serial numbers in a standard format, to be agreed with their bank, the Peninsula said.

Banking industry sources told Al Sharq, the Arabic version of the Peninsula, that banks are ready for the change, with both administrative and technical preparations in place.

Employment specialist Luke Tapp of Pinsent masons, the law firm behind Out-Law.com said: "The WPS is designed to protect employees working in Qatar by encouraging employers to pay salaries on a regular and consistent basis, with a particular focus on sectors which attract large numbers of low skilled workers."

"The WPS will enable the Qatar government to easily document, monitor and address the late or non-payment of wages. The incorporation of the WPS is a fundamental change in the existing arrangements within Qatar and therefore, it is not hugely surprising that the local authorities have been required to postpone the deadline for compliance. Ultimately, the introduction of the WPS is a positive development for the Qatar labour sector and when it is fully implemented, it will create a more transparent and employee friendly jurisdiction," Tapp said.

"A good example of where a similar Wage Protection System has been successful is the UAE, where the Ministry of Labour and UAE authorities regularly monitor employers’ compliance with the WPS requirements and penalise those who are in breach of its requirements," he said. "The WPS was introduced into the UAE in phases during 2009 and 2010, which enabled companies to gradually transition into compliance."