CHALLENGES AND SUCCESSES OF FOREIGN LABORERS IN

C O N F I D E N T I A L SECTION 01 OF 05 KUWAIT 002231 SIPDIS SIPDIS NOFORN FOR NEA/ARP, INL/HSTC, AND G/TIP LONDON FOR TSOU E.O. 12958: DECL: 06/12/2016 TAGS: PHUM ELAB PREL EG KU TIP SUBJECT: CHALLENGES AND SUCCESSES OF FOREIGN LABORERS IN KUWAIT: THE CASE OF EGYPTIANS Classified By: CDA Matt Tueller for reasons 1.4(b) and (d) ¶1. (C) Summary: The Egyptian expatriate labor community is Kuwait's second largest, surpassed only by the Indians. Anecdotal evidence suggests that Egyptian workers do not suffer as badly as workers from other expatriate communities. Post consulted with Egyptian Embassy officials as well as Egyptian workers to see if other expatriate laborer communities could learn from the Egyptian experience. The Egyptian Embassy reports that it prevents many labor problems by regulating the process by which Egyptians are hired to go to Kuwait. It further reports that it solves many of the problems that do occur by using its close relations with the GOK to resolve disputes and by blacklisting offending companies if mediation does not work. The Egyptian Embassy refuses to share its strategies or influence with other source country embassies, viewing these countries as competitors and fearing that the Kuwaiti government would end the comfortable relationship between the Egyptian Embassy and the GOK if Egypt publicizes labor problems too much. Egyptian workers are unaware of their Embassy's efforts and dismiss its willingness or ability to help them. Based on the Egyptian experience, source countries can be most effective on large-scale issues, whereas it is practically difficult for them to solve the problems of individual workers. End Summary. The Egyptian Labor Community in Kuwait -------------- ¶2. (C) PolOff recently met with Egyptian Ambassador to Kuwait Abdel Rahim Shalaby, First Secretary Sherif Eldiwany, and Rizq Al-Saeed Shuwail, the Egyptian Embassy's Labor Attache, to discuss how the Egyptian Embassy deals with its community's work-related problems. Anecdotal evidence suggests that workers from other countries, for instance Bangladesh and Nepal, suffer more severe exploitation, so Post wanted to see if the Egyptians had some effective ways of supporting their citizens. Shalaby told PolOff that the Egyptian expatriate community in Kuwait numbers approximately 390,000, of whom approximately 250,000 are workers and the rest are family members. Only India has more expatriates living and working in Kuwait, with as many as 500,000. Egyptians fill the void created after the 1991 liberation of Kuwait, when Kuwait expelled most of the 400,000 resident Palestinians in retaliation for Palestinian support for Iraq. Like the Palestinians who preceded them, and unlike their Asian competitors, Egyptian workers are native Arabic speakers, thus making their integration into the workforce somewhat easier. Unskilled Arabic-speaking workers from Lebanon, Syria, and Iraq are not allowed to come into the country for security reasons. Egypt,s Labor Ministry Approves Contracts -------------- ¶3. (SBU) Shuwail told PolOff that Egypt,s Labor Ministry approves all contracts signed by Egyptians going to work in Kuwait. The Labor Ministry enforces a minimum monthly wage of 100 Dinars (340 USD),a figure 2 - 3 times greater than what some unskilled expatriate workers receive. Egyptians leaving the airport in Egypt for Kuwait must show proof of the Labor Ministry's approval of their contract before they can leave the country. The Egyptian Government permits them to work in Kuwait only as long as the contract approved by the Labor Ministry is in force. (Note: Post discussions with labor-sending countries reveal that most worker-related problems occur when workers work for someone other than their official sponsor. End Note.) According to Shuwail, the Labor Ministry's involvement is the first line of defense for Egyptian workers for two reasons: contracts can be checked for fair terms and the Egyptian Government has a copy of the contract in case of a dispute. Although problems still occur, Shuwail thinks this contract-verification step plays a major part in preventing many problems from emerging. Egyptian Embassy Strategy: Blacklisting and "Wasta" -------------- -------------- ¶4. (C) Despite the signing of contracts under Egyptian KUWAIT 00002231 002 OF 005 government supervision, the Egyptian Embassy estimates that it gets 100 worker-related complaints every day. These complaints are roughly equally divided between delinquency in salary payment, illegal holding of passports by employers, iqama (residency permit) transferring, and iqama selling. According to Shuwail, the Embassy is able to intervene on behalf of many workers because of its influence ("wasta") as well as the Egyptian government's control over the flow of workers into the country. In many cases, Shuwail says he is able to intervene with Kuwaiti employers and mediate a solution. He notes that in the Middle East, personal relations are the best way of accomplishing goals. In cases where this is impossible, the Egyptian Embassy will blacklist the offending company. This prevents the company from bringing additional Egyptian workers into the country. Since many of these companies rely on Egyptian workers, they resolve the worker's complaint in order to be able to bring more workers in the future, according to Shuwail. Salary Delinquency -------------- ¶5. (C) Workers of all nationalities frequently complain of lateness or even outright failure to pay salaries. Eldiwany gave an example of a company owned by Capital Governor Shaykh Ali Al-Jaber Al-Sabah, son of the late Amir (and nephew of the current Amir),which had been duping workers by having them sign blank salary receipts. The company would then pay the workers low salaries and go back and fill in higher amounts on the receipts. When the Egyptian Embassy brought the matter to Shaykh Ali's attention, the Shaykh said one of his underlings must have been embezzling the money and quickly rectified the situation. Eldiwany said he believed Shaykh Ali and that corruption in middle management is not uncommon, but is easy to resolve by speaking to upper management. Residence Trading -------------- ¶6. (C) Among the biggest problems for Egyptian workers is iqama trading. Since workers are so desperate to come to Kuwait, they are often willing to pay for the privilege. Kuwaiti companies have agents in Egypt, who, according to Shuwail, charge workers 300 - 500 Dinars (1030 - 1710 USD) for the privilege of getting a particular job. (Note: The Pakistani Labor attache in Kuwait, Inam Ghani, has told PolOff that Pakistanis have paid as much as 1500 Dinars (5140 USD) for jobs that pay 40 Dinars (140 USD) per month. End Note.) Unfortunately for some of these workers, some of the companies who sell them these permits do not intend to actually employ them. They set up sham companies that exist on paper (and most have an office purporting to sell air-conditioners or some other product) and have the legal right to bring in workers, but whose only purpose is to take the money that workers pay for the documentation. Some legitimate companies bring in more workers than they actually need, and tell them to find jobs on their own. Sometimes the workers know there is no work for them, but pay the money anyway and simply try to find a job once they have arrived. A visit to an Egyptian residential area in Kheitan showed that this sort of arrangement, which the workers call a "free visa," is perhaps the most common way Egyptians come to Kuwait. ¶7. (C) Another frequent complaint is that when the worker arrives in Kuwait, the employer substitutes a lower-paying contract than the one the worker signed in Egypt. Other times, according to Shuwail, companies import workers and then submit police reports that the workers have been absent from work, resulting in deportation. The GOK is aware of this problem and has publicized its formation of a committee to deal with it, though Post is still awaiting a request to meet with someone from the committee. The problem is so prevalent that the Ministry of Social Affairs and Labor (MOSAL) has reportedly instituted special procedures to make sure that candidates for the June 29 parliamentary elections do not use their wasta (influence) to obtain extra work permits for constituents in exchange for votes. KUWAIT 00002231 003 OF 005 ¶8. (C) There have been some high profile iqama trading cases where several hundred workers arrived to find no work. Usually, however, only smaller firms engage in iqama trading since large companies are subjected to greater scrutiny. Shuwail said he places such companies on the blacklist and helps the worker to file a complaint with MOSAL. Employers Hold Passports to Coerce Workers -------------- ¶9. (SBU) Many workers in Kuwait have their passports confiscated by their employers. When they ask for their passports, they are told that they could lose their jobs. If salary payments are several months behind, the employer will hold the passport as leverage so the worker gives up on getting his back wages. Pakistani Labor Attache Ghani and Bangladeshi Labor Attache Shahriar Siddiky report this as an extremely common problem, noting that a very high percentage of workers have their passports taken away and only get them back at some cost. ¶10. (C) Dr. Salih Al-Shaykh, Assistant Undersecretary for Labor Affairs at MOSAL, told PolOff that it is illegal for an employer to hold a worker's passport against his will. But he then justified why employers hold workers, passports, saying that it eases administrative procedures for companies with large numbers of employees. He also gave an example of a worker driving an armored money vehicle: what would keep the worker from stealing the money if the employer did not keep his passport? Other GOK officials have told PolOff that workers can always get their passports back by filing a case. Unfortunately, workers rarely know this. And if they do, the administrative hassle, plus the possible retribution of the employer in terminating the employee or withholding back wages (and filing a case to redress these concerns is a more difficult administrative procedure) often convince the worker that standing up for his rights is not worthwhile. ¶11. (C) Shuwail told PolOff that the most effective strategy in this type of case was for him to go and talk to the company's administration to convince them to give the passport back. If this does not work, the Egyptian Embassy would issue a new passport for workers who were being blackmailed, help the worker find a lawyer, and possibly add the company to the blacklist. Iqama Transferring -------------- ¶12. (C) According to Kuwaiti law, a non-household worker who does not hold a university degree in the field in which he works is allowed to transfer from one sponsor (employer) to another after working for one year for his original employer. Employees with university degrees may transfer at any time. Shuwail notes that many employers try to force their employees not to transfer, by withholding salaries and passports. As with the other cases, the Egyptian Embassy reports that it has had some success with direct intervention and with blacklisting employers. Egypt Reluctant to Share Information -------------- ¶13. (C) PolOff asked the Egyptians if they would be willing to share their strategies with labor attaches from other source-country embassies. Shuwail said that he would not. Furthermore, he said that he would deny everything he had told PolOff if it came out publicly. He explained that remittances from Egyptians in Kuwait are an important source of income for Egypt and that Egypt would not want to jeopardize that. The Egyptians fear that the Kuwaitis could retaliate against Egypt if its workers, presence becomes a problem, as the wholesale expulsion of the Palestinians in 1991 demonstrates. Further evidence of this is that Kuwait has periodically forbidden the entry of workers from certain countries, such as a ban earlier this year on Bangladeshis, who took part in the highest profile protest over labor issues in Kuwait in recent memory when they ransacked the Bangladeshi Embassy in April 2005. In April 2006, the Government announced that it had officially lifted all bans KUWAIT 00002231 004 OF 005 on workers from particular countries, though Bangladeshi labor attache Siddiky said it was only the May 7 - 9 visit of Bangladesh's Prime Minister that ended the ban. ¶14. (C) Probably not coincidentally, the Indian Embassy has also been reluctant to share information with PolOff and has not sent representatives to any of the three informal source-country labor attache meetings that Post has organized. It seems clear that the Indians and Egyptians know that the sheer size of their presence is worrisome to the GOK. Ambassador Shalaby recounted to PolOff how he was once sitting at a function with the Indian Ambassador when a third ambassador at the table quipped that "between the two of them they could take over Kuwait." (Note: Kuwait's citizen population reportedly reached 1 million in March ¶2006. End Note.) Therefore, the Egyptians -- and probably the Indians, though they have not been as open in explaining their thinking to Post -- are doing a balancing act between using the size of their presence to solve workers, issues, while not wanting to seem like part of an international consortium to gang up on Kuwait because of its labor problems. The View from the Bottom -------------- ¶15. (SBU) After conducting these meetings with Egyptian Embassy officials, PolOff and an Egyptian LES motorpool driver visited two areas heavily inhabited by low-skilled Egyptian laborers. Many low-skilled Egyptians live packed into dirty, dilapidated buildings interwoven by trash-strewn alleys that evoke a third-world slum, not one of the richest countries in the world. Workers squeeze as tightly as possible into the small rooms they rent for 30 - 60 Dinars (USD 105 - 210) per month. In certain parts of Kuwait's Kheitan neighborhood, virtually everyone on the street is a male Saidi (Upper Egyptian),many of them dressed in the typical Egyptian galabiyya and Saidi head-wrap. PolOff entered residential buildings randomly and conducted short interviews with several dozen workers. ¶16. (SBU) Virtually every Egyptian worker had paid a hefty sum -- ranging from 600 - 1300 Dinars (USD 2070 - 4485) -- to get a visa to come to Kuwait. A few had paid for a visa to work with a particular company. Most, however, had bought a "free visa," which means that they were simply paying a Kuwaiti (through the mediation of an Egyptian, who was getting a cut of the money) who had permission to sponsor foreign workers to come to Kuwait. It was then up to the worker to find a job. Most workers were working for 100 ) 150 Dinars a month (USD 340 ) 510) and estimated they could save approximately 50 Dinars (USD 170) a month. Therefore, they have to work for 1 ) 2 years to get back to the break-even point. The documents they buy are generally valid for two years, at which point they have to pay a Kuwaiti 200 ) 300 Dinars (USD 680 ) 1020) to sponsor them for another two years. Sometimes they pay this money to the original sponsor who facilitated their coming. In other cases, the original sponsor canceled the sponsorship so as to be able to bring more workers, so the Egyptian will have had to transfer to another sponsor. Presumably that other sponsor should be his employer, but in most cases it seemed to be someone simply selling sponsorship. ¶17. (SBU) Most stated that they did not have major problems at work. Salaries were generally paid on time through automatic bank transfers, especially with those who work for large companies. Most had contracts, and generally the terms of the contracts were honored. ¶18. (SBU) Several workers gave examples of problems that they or people they know had encountered, however. One worker was being asked to pay for damages to a company vehicle that was rear-ended while he was driving it on the job. Another had been badly underpaid for a contracting job he had done. When asked about whether they or their friends had gone or would go to the Egyptian Embassy if they had a problem, the workers responded with an assortment of scoffs, incredulous stares, and wisecracks that made clear that they would not. ¶19. (SBU) Only one worker, who gave his name as Allam, had KUWAIT 00002231 005 OF 005 actually tried going to the Egyptian Embassy. He had given his passport to the (Egyptian) representative of his employer in order to transfer his sponsorship because he had reached the end of the agreed-upon period of service and his iqama was expiring. The representative told him the sponsor was in jail for labor-related violations and offered to transfer his residence for a fee of 300 Dinars (USD 1035). Since Allam is subject to a 2 Dinar-a-day fine while he is in the country illegally, he agreed. The representative, however, simply whited-out the name of the original company and expiry date on the contract and replaced them with other information. Allam was understandably unsatisfied with this and refused to pay the money. He has been unable to retrieve the passport for five months. He said the Embassy had asked him for his passport and information on his sponsor. Allam only knew the Egyptian representative of his sponsor, and was therefore unable to provide the information. He had found another employer and did not seem to have a plan for how to resolve the problem of his missing passport. He seemed to have given up on the Embassy being able to help him. Source Country Assistance Helpful; GOK Must Do More -------------- -------------- ¶20. (C) While the Egyptian workers clearly discounted the ability of their Embassy to help, the Embassy may have in fact improved Egyptian workers, situation in Kuwait. The Egyptian Embassy's blacklisting of companies and direct intervention may solve and prevent many problems, though quantifying these successes is impossible. Getting involved in individual cases like Allam's is no doubt a difficult prospect. On the other hand, the Embassy can intervene when a company is repeatedly violating workers' rights or violating a large number of workers' rights. This can then send a message to other companies. ¶21. (C) The Egyptian Labor Ministry's efforts appear to be worthwhile as the information it gathers can help to identify unscrupulous companies. Kuwaitis and their Egyptian agents, however, easily avoid the Egyptian Labor Ministry's efforts to control the outflow of Egyptian workers. More work clearly needs to be done by the Kuwaiti Government. Residence trading puts workers in deep debt and therefore makes them subject to exploitation. With the economy currently booming, Egyptians are finding work easily. If the economy weakens, some of these Egyptians may find themselves accepting jobs that will not suffice to pay back their debts, leading to indentured servitude. Some South Asian workers already complain of being trapped under their debts. The fact that most Egyptians do not have a similar complaint supports the Egyptian Embassy's claim that its efforts have elevated the conditions of its workers. ¶22. (C) In the end, most Egyptians are being paid according to the nationally-mandated system of a monthly electronic bank transfer. (Note: There are reports that companies hold the workers, ATM cards and withdraw parts of their salaries every month, though none of the workers Post talked with reported this happening to them. End Note.) Most find it worthwhile to come to Kuwait and many of the Egyptian workers reported working in Kuwait for ten years or more. The law in Kuwait, when enforced, is adequate to insure acceptable working conditions, and Egypt has come up with helpful means of protecting workers that other countries should consider emulating. Post will pass on the lessons of the Egyptian Embassy to the source country labor attaches without compromising the identity of the source. Enforcement on both ends clearly needs to be encouraged in order to prevent possible increases in labor exploitation. ********************************************* * For more reporting from Embassy Kuwait, visit: http://www.state.sgov.gov/p/nea/kuwait/?cable s Visit Kuwait's Classified Website: http://www.state.sgov.gov/p/nea/kuwait/ ********************************************* * TUELLER