Implementing a minimum wage policy will be very costly for Bahrain and will not have a direct impact on reducing the unemployment rate among low-skilled citizens, Labour Minister and Labour Market Regulatory Authority (LMRA) board chairman Jameel Humaidan has said.

Also, if Bahrain imposed a standard minimum wage for both Bahrainis and expatriates, then 80 per cent of the wage increase would only benefit expatriate workers, he said.

Setting a discriminating minimum wage, i.e. a minimum wage for Bahrainis and another of lesser value for expatriates, would set up cost differences between Bahrainis and expatriate workers, he added.

This came in the LMRA’s recommendations in response to questions by the parliamentary committee, led by Ahmed Al Salloum, in charge of probing falling living standards for citizens.

Mr Humaidan stressed that many successful economies had applied the minimum wage system but the percentage of expatriate workers in their labour markets was much lower than that of Bahrain.

He pointed out that 80pc of the total fees for issuing permits is transferred to the Labour Fund (Tamkeen), which uses them to develop the skills of Bahraini workers in the private sector with the aim of creating suitable job opportunities for them, while imposing heavier fines on violators of the Labour Market Law, with the fines ranging between BD1,000 and BD2,000 for each violating worker.

In response to a question by the committee about whether increasing fees for expatriate workers would lead to an increase in the employment of citizens, the minister confirmed that the increase in fees had a direct impact on the cost of recruiting foreign workers.

But he said the extent to which Bahraini workers would be able to compete in the labour market with their expertise and skills should be taken into account before raising fees for expatriate workers.

It was also important to study its impact on the overall economic situation in the kingdom, he pointed out.

The minister added that the fees imposed on employers in return for issuing work permits to foreign workers were currently being studied by the ministry and the authority based on an urgent proposal received from Parliament recently.

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