In this paper we shall seek to explore the latest trends in Kuwait Job Market with special focus on national labors. The main factors that led to these significant changes such as the increase of public awareness of the importance of national labor and the risks of full dependence on expatriates together with the increase of the number academic graduates who seek job opportunities in Kuwait shall examined and assessed. The paper shall examine the changes in the national labors structure both in the public and private sectors. It is necessary to examine the legal framework that organizes the employment of national labors in the public sector and the private sector. This will extend to cover Kuwaitization Law and Private Sector Labor Law that enacted in 2010. The paper shall go through the main differences between national labors in the public sector and the private sectors together with the reaction of private companies to the mandatory national labor percentage impose by the new laws. We shall conclude this paper with some suggestions to improve the legal framework of national labors in Kuwait.
Introduction
It is evident that Kuwait job market has undergone several significant changes during the last decade as there has been increasing participation of national labors. The government started serious attempts to execute the Kuwaitization program in the most vital sectors in Kuwait. In order to Kuwaitize government jobs there was an urgent need to reexamine the employment policy in regards to the replacement of the foreign labors with national manpower. (Kuna, 2010) On the level of private sector the Cabinet has taken serious measures to increase the number of national labor recruited by private enterprises. In this regard, the Council of Ministers enacted Resolution No.955-2005, which amending Resolution No.904-2002, in 2005 in relation to the increase of the minimum required percentage of national labors in the private sector companies.
The Resolution states that national labors must form 50% of manpower in the banking and communication sectors.( Kuwait Times, 2005) . In light of the above mentioned changes we shall explore the legal frameworks that organizes national employment in both the public and private sectors with special attention to the new labor laws legislated by the Council of Ministers in 2010. This paper shall also examine economical, social and legal implications of the increase of national labor in the private sector companies together with the reaction of these companies regarding the new laws.
Overview of National Labor in Kuwait
According to the statistics issued by the Ministry of Planning the number of the overall labors in Kuwait is estimated with 2.2 million labor out of which national labor represents about 33%. The majority of the national labor is concentrated in the Public Sectors especially in the Ministry of Education, Banking Sector, Ministry of Oil and Ministry of Labor. Recently there has been growing involvement of national labor in the private sector. However, the percentage of national labor in the private sector in Kuwait is still low in comparison to the high percentage of expatriates who dominate most jobs in the private sector. However, it should be mentioned that low wages in the private sector in comparison to the public jobs in Kuwait doesn't encourage the national labor to seek employment in this sector. There is a lack of a uniform strategy for national manpower in Kuwait which causes some kind of unplanned actions by the government.
After Liberation of Kuwait in 1990, there has been a public awareness to the risks and dangers associated with total dependence on foreign labor especially from countries with hostile policies against Kuwait. Foreign labors used to form the majority of labors working in Kuwait vital sectors such as oil, banking and education. Since the 1990s the Government started taking vast steps to increase the number of Kuwaiti labors in these sectors. The government ensured the recruitment of academic graduates in the vital sectors of Kuwait according to their specialties and studies. Secondary school certificate holders were also recruited by the government as clerks and in other secretarial works in sectors such as the Ministry of Interior and the Ministry of Labor.
According to the statistics of Kuwait Banking Association, about 52% of national labors in Kuwait are working in the banking sector:-"The Kuwaiti banks have contributed to nearly KD80mn to back the national employment support program, going by the law, which is one of the highest ratios in the sector".( Kuwait Banking Association) Kuwaitization of vital sectors in Kuwait was another major step taken by the government especially by the end of 1990s and the begging of 2000s.
The statistics issued by the Ministry of Planning in 2007 show that the total workforce in Kuwait is estimated 1,869,809 out of them about 335,238 Kuwaitis (194,716 men and 140,522 women). (www.kuwaitpocketguide.com )
Legal Framework
The Constitution of Kuwait has guaranteed that all Kuwaiti National shall have equal rights and duties including the right to work and have reasonable source of living that provides a peaceful social life. The right of people to work and have financial income is guaranteed by the Constitution in the governmental sectors and has called upon private institutions to recruit Kuwaiti national as a part of their national duty towards the country. At first and because the public sector was able to absorb all the number of Kuwaiti Nationals eligible to work, the government didn't resort to legalize laws that enforce the private sector to mandatory recruit Kuwaiti nationals. Then when the number of Kuwaiti graduates increased and exceeded the capacity of the public sector, the government started taking legal actions to ensure the recruitment of percentage of Kuwaiti nationals.
The government has enacted several labor laws that organize the relationship between labors and employers both in the public and private sector. Kuwait Labor Law organizes this relation in respect to wages, vacation, sick leaves, public holidays, and termination and working hours. Active Legislation of Kuwait Labor Law started in the 1960 with the issuance of Kuwait Labor Law No. 18/1960, which governs labors in the public sector, the Amiri Decree No.7/1960, which governs civil servants and employees in the public sector and Labor Law No.38/1964, which governs labors in the private sector. ( HelpLine Law) . The government has amended Kuwait Labor Law more than once to adopt the changes and the needs of job market in Kuwait.
National Labors Supporting Laws
The attempts of the government to impose mandatory percentage of national in the private sector were crowned by the enactment of Kuwait Manpower Law No..19/2000. The law aims at increasing the percentage of Kuwaiti labors in the private sector. The new law identified the percentage of national labors to be recruited by the private sector and set KD500 charge for the companies that don't comply with this percentage. According to this law the percentages of national labors required in the private sector is classified as per the business of the company. The percentage of national labors that should be recruited in the banking sector is 50% of the total manpower of this sector. National labor percentage in the private sector is applied to all businesses under certain categories under specified categories employing 100 or more workers and firms having 50-75 expats must employ one Kuwaiti.( Kuwait Embassy)
In the same line, the Council of Ministers enacted Resolution No. 955-2005 to amend Resolution No. 904-2002 to increase the minimum required percentage of national labors in the private sector companies.( www.asarlegal.com)
Another step was taken by the government of Kuwait to encourage employment in the private sector by extending the social allowance to national labors working in the private sector and has initiated training sessions to prepare national manpower to the requirements and demands of the private sector. The costs of the training programs shall be covered through 2.5% tax collected from the companies listed on the Kuwait Stock Exchange. (www.kuwaitpocketguide.com)
A new Labor Law was enacted in 2010 to entirely amend the previous labor laws. Kuwait Labor Law No. 6/2010 offers great flexibility in terms of employees' leaves and working hours. For the first time the new law mitigates the restrictions imposed on the formation of labor unions in Kuwait as well as increases the rights of female employees. The law amends the parts related to end of service indemnities which allow an employee to receive a full end of service indemnities at the end of his/her contract period. Unlike the pervious laws which don't entitle the resigned employee to have any end of service indemnities, the new law allows the resigned employee to have half of end-of-service indemnities if resignation is made after three or five years of service and to have two-third of his/her end of service indemnities if resignations is made after five-ten years of service.
The new law has also magnified the rights of women working in the private sector who were only entitled to have a paid maternity leave for thirty days before maturity day and forty days after giving birth with no right in the annual leave. Now under the new law, the maternity leave is extended to 70 paid days plus any other leave. Working hours for females are also extended by the new law to be prohibited from working from 10pm- 7am.
Article 4 of Kuwait Labor Law states that "states the payment of cash allowance to every unemployed Kuwaiti who is fit and willing to work and who is looking for a job but cannot find any. This law refers to the CCB to determine the rate of such allowance and to set conditions for the entitlement to such allowance" (Article4, Law No6/2010)
Unemployment Insurance
In 2000, the Cabinet has approved unemployment insurance to be paid for non-employed nationals on monthly basis as follows; KD 175-KD200 for academic graduates, KD 125 to KD 150 for secondary schools certificates holders and KD75- KD125 for those below this level. However, in 2007 the government denied Parliamentary initiatives for the payment paying unemployment allowances for citizens applying to governmental jobs for unlimited periods and until they are recruited. ( Kuwait Times, 2007)
Suspension of Allowance for Working Students
The Council of Ministers has aggressively suspended the employment allowance for working students who are less than 25 years old. This decision was refused by great sector of the Kuwaiti students who felt that great harm has been done to them. Being a member of the work group who developed this paper, I have a personal experience with this decision. Whereas I am an employee in Burgan Bank, I have applied to be registered in the National Labor Support Program in the respective department in the bank on 14/7/2009 as I was supposed to complete my 21years old on 23/7/2009. I have also sent a notice to the HRM in the bank to finalize the required measures. However, on 2/8/2009 the Cabinet decided to suspend this support for students less than 25 years old. Though I was registered before the issuance of this decision, for some reasons the respective authority in the bank didn't conclude my registration on time which caused me to be deprived of my due support. Now my case is heard in the court and I am waiting for the decision of the court.
Differences between the Public Sector and the Private Sectors
It is very evident that the majority of Kuwaiti nationals prefer to get employed in the public sector due to its remarkable privileges in terms of work, load, working hours, wages and other financial compensations'. Though all Kuwait Labor Laws whether related to the private sector or the public sector don't specify the specific amount that should be paid for each employ monthly, no doubt national employees who work in the public sector receive considerably higher salaries than those working in the private sector. The salaries of the employees working at the public schools the Ministry of Education are not to be compared with the salaries of those working at the private schools.
Working hours are identified by labor law shouldn't exceed 8 hours per day " It is forbidden to have employees work more than 48 hours per week or 8 hours a day, except for cases stated in this law. The working hours in the month of Ramadan should be 36 hours per week". ( Labor Law No.6/2010). Many private institutions don't comply with this provision and use labors for more than 8hrs per day. The lack of effective supervision and control by the Ministry of Labor encourage private companies to breach many articles of the respective laws while in the governmental sectors these articles are fully observed.
The Council of Ministers has decided Friday and Saturday as formal weekend for the public sectors, most of the private sector companies don't comply with this decision and have their employees work on Saturdays and some aggressive cases they have them work part-time on Fridays without being entitled in overtime compensation. This is another privilege enjoyed by the national labors in the public sectors and missed by those who work in the private sectors.
Another controversial issue is that though the government has enacted laws compel the private sectors companies to recruit a specific percentage of national labors; many of these companies make under table deals and pay certain amount of money for those who should be recruited just to record them on their employment records. In other words, there is no real implementation of national employment support laws.
Conclusion
In light of the above mentioned facts, the government of Kuwait has taken several initiatives to increase and encourage the employment of national labors in the private sector. However these attempts don't meet the expectations of the Kuwaiti nationals who feel greatly disappointed by the lack of seriousness of the government in activating these laws in the private sectors which witnesses many breaches and incompliance with these laws. From its part the private sector considers that employment of Kuwaiti nationals should be financially supported by the government as private companies cannot afford high salaries required by national labors and therefore they tend to employ expatriates for low wages. Taking into consideration of the richness of the state of Kuwait and the tremendous revenues brought by the oil sector and the relatively small numbers of population, the government is mainly responsible of the growing unemployment rate among Kuwaitis. There is need for more active decision to complete the Kuwaitization program of all the public sectors in Kuwait which still pertain high percentage of expatriates. The government has also to reconsider the unemployment allowance for graduates who don't have job opportunities in either the public sector or the private sector. There is a need to provide job opportunities for those citizens under the Constitution of Kuwait or provide them with reasonable unemployment allowance to enable them to lead a respectful life. More strict control on different practices of private companies with regard to work hours leaves and overtime is urgently needed to ensure that the basic rights of the national labors in these companies aren't breached. The government is more interested in legislation than in actual implementation of the legalized laws. This is a great fault that needs to be reconsidered by the government on the short run.
