As the initial deadline to implement a new electronic salary payment system in Qatar approaches, several questions remain about the logistics of the process.

According to a new law signed by Qatar’s Emir in February, companies will soon be required to pay their employees through direct bank transfers, making it easier for expats and the government to scrutinize and document any late or non-existing payments.

Employees should be paid in Qatari currency once a month, or for some category of workers, every two weeks.

For the past several months, various governmental organizations, including the Ministry of Labor and Social Affairs, Qatar Central Bank and the Ministry of Interior have been working to create a database of blue-collar workers and their companies.

According to the Peninsula, once the new system comes online, companies will send money to banks, which will directly deposit wages into an employee’s account. Workers would then be notified of the transfer.

Questions

Many companies have been given half a year to sort the system out, a deadline that expires next Tuesday, Aug. 18.

Once the grace period is over, employers in violation of the amendment could face jail time of up to one month and fines of QR2,000 to QR6,000.

However, MOLSA has the discretion to further extend the deadline. With several questions remaining about the EPS system’s implementation, such a move is possible.

The Peninsula reports:

“It is not known if a company will have to use its existing bank or would need to open a separate account with a bank the labour ministry-QCB suggest. It is also not known if workers will have to chose banks to open WPS accounts or the labour ministry-QCB will assign them banks.

It is also not clear if exchange houses will be part of WPS but indications are they might be.”

Nevertheless, mandatory direct bank transfers are a significant part of a package of labor reforms that Qatar has been promising to implement for over a year.

Other pledges, including revising the law to make it easier for expats to change jobs and leave the country, remain in the works.

Thoughts?