As many as 200 French employees are said to file lawsuit against contractor following alleged non-payment of wages
Construction giant Saudi Oger is expected to file for bankruptcy amid liabilities of over $800 million in alleged unpaid salaries and other outstanding payments, according to press reports.
The Saudi Arabian contractor’s latest problems have come to light following the filing of a lawsuit against it by employees in French courts, according to reports in French and international media.
It was claimed that as many as 200 French employees working as engineers and managers on Saudi Oger projects in the kingdom have alleged that they have not been paid for nine months.
Negotiations between the lawyer representing the employees and the company have reportedly failed to find a resolution to date. Employees are demanding the full payment of salaries and compensation owed.
A report by the Saudi Gazette said economists expect the company to declare bankruptcy to get over its acute financial problems.
The Riyadh-based construction giant has allegedly failed to pay financial dues to medical insurance companies, which has resulted in the stoppage of medical insurance to its employees, a Saudi Oger source told the newspaper.
“The problem is not only with medical insurance, but also with the end of service benefits. Some employees are entitled to more than SR500,000,” the source said.
The company is liable for the payment of medical insurance and the fees of the General Organisation for Social Insurance (GOSI), a number of economists and lawyers added. The only way to get out of this financial crisis is to declare bankruptcy, they said.
“The company can get out of its commitment to pay its dues by openly announcing bankruptcy,” Adnan Khoja, member of the insurance committee at the Jeddah Chamber of Commerce and Industry (JCCI), told the Saudi Gazette.
Meanwhile, the French embassy in Riyadh has said that it has been giving financial aid to the afflicted French employees so as to help them meet their expenses, including their children’s school fees, until the issue has been resolved.
Jean Marc Ayrault, the French foreign minister, said that the French government is communicating with officials in the kingdom and the company to help resolve the issue.
Earlier this month a source at Saudi Oger said that 31,000 employees have lodged complaints over alleged delayed wages.
Both Saudi and foreign workers are said to have filed complaints with the Saudi Arabian Labour Office, an Arab News report said.