Workers set vehicles and construction equipment on fire at Saudi Ogers offices when a protest demanding delayed wages turned violent, in a second such incident in less than two months in the kingdom.
About 150 Saudi Oger workers who gathered in front of the companys Jeddah branch office late on 7 June to demand delayed salaries set ablaze several buses used to transport labourers and heavy construction equipment. The police were called in, which dispersed the crowd and prevented further damage to company property, according to local daily Arab News. It did not say whether any arrests were made.
They were protesting against non-payment of salaries for six months, Jeddah police spokesman Atti al-Qurashi was quoted by Arab News as saying.
Violent labour protests are uncommon in Saudi Arabia, which deals with social and labour unrest swiftly and decisively. However, the social backlash of lower oil prices and the resulting delay in payments to contractors from government bodies, is quite evident in labour protests, which are now becoming a common sight in major cities.
Workers of Saudi Binladin Group (SBG) set on fire several company buses in Mecca in May, just a day after the company laid off almost 50,000 of its workforce. SBG terminated the deals of expatriate labourers and gave them permanent exit visas to leave the kingdom. The workers, however, refused to leave the country without getting paid, which resulted in violent confrontation.
SBG has laid off about 70,000 employees so far and its spokesman said the company is honouring its commitments to workers and has fully compensated affected employees. Protests in the meantime are continuing in Mecca and Jeddah, where SBGs headquarters is based, with workers claiming they have not been paid for more than six months.
It is not known how many workers Saudi Oger has let go to cut costs, but labour protests are a common feature at its offices, according to reports.
Saudi Oger like SBG, prospered during Saudi Arabias building boom of the past decade. Both were involved in building some of the most iconic projects in the kingdom, including skyscrapers, bridges, railways and airports.
However, Saudi contractors are the worst hit among the Gulf construction firms as the price of oil, which accounted for more than 70 per cent of the governments revenue in 2015, has fallen from a mid-2014 peak of more than $110 a barrel. The kingdom is expected to run a budget deficit of $86bn this year and is already running an austerity campaign. It has cut spending and has capped the award of new deals. Payments to contractors have come down to a trickle, which is causing a knock-on effect on the broader economy.
Meanwhile, the Labour and Social Affairs Ministry has transferred construction sector workers complaints to a special court. The Labour Office has stopped all services to these companies as a result of a violation of the Wage Protection System, Arab News cited Ahmed al-Ghamdi, director of the media centre at the ministrys branch in Mecca, as saying.
In March, the ministry had confirmed stopping only social security and passport affairs services to Saudi Oger as part of its punitive steps.
The authority has now formed a committee to address the issues raised by Ogers employees and the Riyadh governorate is expected to coordinate with the committee to resolve the labour matters.