LMRA: First phase of ‘Wage Protection System’ officially begins today

Manama, May 1 (BNA): The Labour Market Regulatory Authority (LMRA) has announced that the first phase of the ‘Wage Protection System’ has officially begun today.

Commenting on this, the LMRA’s Chief Executive Officer, H.E Mr. Jamal Abdulaziz Al Alawi highlighted the successful enrollment of 92% of the targeted group of stakeholders in this phase, outlining that the LMRA is collaborating with the remaining stakeholders to facilitate their seamless enrollment and readiness.

Al Alawi explained that the LMRA started implementing the first phase today following the Cabinet’s decision to approve the timeline for the implementation of the wage protection system, and the Minister of Labour and Social Development, Chairman of the Board of the Labour Market Regulatory Authority’s Decision Number 22 for the year 2021 on the timeline of implementation of the wage protection system for workers in the private sector. He noted that the current phase includes employers who employ 500 workers or more.

Turning to enrollment procedures, Al Alawi pointed out that LMRA has been keen to facilitate all procedures related to joining the system, adding that employers must open bank accounts for all workers registered in their respective facilities (Bahrainis and expatriates) at commercial banks or financial institutions licensed by the Central Bank of Bahrain, without the need to visit LMRA.

Al Alawi indicated that the system, in its electronic form, contributes to strengthening oversight and ensuring that employers fulfill their obligations towards employees, noting that commercial banks and financial institutions will send wage payment statements periodically according to the approved methods to the LMRA, which, in turn, will verify the commitment of business owners to paying wages.

Al Alawi praised the commitment of 92% of the targeted group of stakeholders in this phase, who partially join the Wage Protection System, by paying the majority of employees’ wages through it; stressing that LMRA has continued its engagement with employers to confirm their full commitment to paying the wages of their employees.

Speaking about the flexibility of the system and gradual implementation, Al Alawi noted that the system grants a six-month grace period with the beginning of the implementation of each phase, during which LMRA follows up on procedures with employers in order to overcome any difficulties that may prevent their registration in the system during the prescribed period.

He outlined that as per the Wage Protection System, the LMRA and the Central Bank of Bahrain are linked electronically with various financial and banking institutions in the Kingdom, welcoming the productive cooperation of the Central Bank of Bahrain in this regard. The LMRA CEO also stressed that enrolling in the system contributes to enhancing transparency, and reducing wage-related disputes, if any.

The implementation of the Wage Protection System will roll out in three phases, where the first phase will include employers who employ 500 workers or more, and has begun today.

The second phase includes employers who employ 50-499 workers, and its implementation is scheduled to begin on the first of September 2021, while the third phase includes employers who employ 1-49 workers, and is scheduled to begin on the first of January 2022.

With regards to the payment of domestic workers’ wages, employers can voluntarily transfer the wages of domestic workers in accordance with the system if they wish to do so.

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