A Royal Decree issued on May 7 abolished Defense Law no. 13 which has been in place for approximately 3 years since the start of the COVID-19 pandemic. This law has been the legal base for issuing numerous defense orders affecting many areas of social and economic life in general and the labor market in particular. The government relied on the Defense Law during the pandemic to deal with the health, social and economic repercussions of COVID-19, and consequently, the decision to terminate this law has prompted discussions regarding the extent to which labor market dynamics have been impacted by this law.
Currently, the majority of defense orders established under the Defense Law are not being enforced. However, it is important to note that the remaining orders, such as Defense Order No.6, have had a significant impact on the Jordanian labor market. For instance, Defense Order No.6 specifically prohibited the termination of workers' contracts except in certain circumstances. This particular order has been instrumental in providing job security and safeguarding the rights of workers in Jordan. In addition, the executive statement No.7 of the same order required the renewal of fixed-term employment contracts for Jordanian workers that expire during starting 30 April 2020 until the announcement of the end of the Defense Law.
How does ending the defense orders affect workers?
With the suspension of the Defense Law the Kingdom’s original laws will be reinstated and applied, including the Labor Law and Jordanian Civil Law.
However, an increase in labor complaints presented to the Ministry of Labor and Labor courts is expected due to the increase in expected layoffs in the private sector.
Other labor issues need to be reconsidered now, especially the decision to reduce service fees in the tourism sector from 10% to 5%. This decision negatively affected the living conditions and job opportunities of approximately 50,000 workers in this sector. In addition, establishments in the tourism sector continued to reduce workers' wages under the pretext of the Defense Law No.6 even after the sector recovered from the pandemic and its repercussions. After the suspension of the Defense Law, establishments within the Tourism sector were supposed to find ways of refinancing salary arrangements in accordance with the new wage levels. However, establishments might sign new contracts with workers on a lower salary in order to correct their financial situation, which is not in the best interest of workers.
The lifting of Defense Order No. 28, which suspended the imprisonment of those defaulting on their personal credits, puts approximately 158,000 individuals at risk of imprisonment. Many of those at risk are business owners and workers who have lost their jobs and are now in debt.
Did the defense orders achieve their desired goal?
Defense Order No. 6 had several deficiencies, including failing to address the issue of workers who are not registered in the social security system and are therefore unable to receive unemployment benefits. This is a significant concern, particularly given that more than half of Jordan's workforce (59%) works as informal labor with no access to social security. It also failed to adequately protect the rights of expatriate and migrant workers.
Defense orders 9, 14 and 24, included economic protection programs by the Social Security Corporation (SSC) to support daily workers and workers in the most affected sectors, such as the “Istidama” program, which allowed establishments to reschedule their owned payments to the Social Security Corporation (SSC), in addition to wage subsidies that protected workers from loss of income while keeping firms solvent and operational.
At the time, Jordan Labor Watch viewed this as a positive step, but the government’s decision to extend the Istidama program allowed companies to evade paying their dues to (SSC) over an extended period of time.
In general, the significant number of workers in the private sector who lost their jobs indicates that the defense orders failed to achieve the government's objectives and exposed the inadequate system of social protection within the Jordanian labor market.
In light of the Defense Law being suspended, it is crucial that the government strengthens social protections and ensures that workers' rights are safeguarded under all circumstances. This should be the government’s main priority.