A large number of expatriates have lost jobs in layoffs in the energy sector due to massive restructuring some say has nothing to do with the falling world oil prices.

Many expatriates are left struggling, desperately looking for new employment, as they have taken huge bank loans and must repay them if they must travel back home for good.

The problem is a vast majority of these workers, being professionals who had plush jobs, have been living here with families with most having children in school. In almost everyone’s case the loss of employment was sudden and shocking. “I was handed this letter of dismissal literally out of the blue,” said a person not wanting to be identified by name or nationality.

The suffering people are of different nationalities, including Indians, Filipinos, Indonesians and Arabs, to name a few.

Indonesian embassy sources confirmed that many compatriots with bank loans to repay were approaching them for help in getting another job after having been retrenched by an energy company. “Obviously, we can’t help them in any way except urge some influential community members to help them get substitute employment,” said a source.

Sources cited a fellow Indonesian who came here to work in the energy sector two years ago. 

“His family joined him some five months back, and now that he has lost job, it’s a disaster. It’s a tragic situation for him and his family. They are stuck here due to an unpaid bank loan. Plus, his children are in school.”

Philippine embassy and community sources claim many Filipinos employed in the energy sector have suddenly lost jobs and having to repay bank loans, are looking for new, suitable employment.

Also, several Filipinos, Indians, Indonesians and others are saddled with police cases because they are unable to maintain loan repayments.

A leading energy company isn’t giving exit permit to its employees who cannot provide clearance from banks where their salaries were transferred.

A bank gives clearance only when it has nothing to receive from a customer. 

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People who have taken loans cannot hope to get a clearance letter from their banks unless they have repaid loans.

However, being fair, the oil company has given time to those laid off to look for new employment, and as rules demand, has informed the banks about employees’ dismissal after transferring their end-of-service benefits to their bank accounts.

Prominent businessman Ahmed Al Khalaf, familiar with the layoffs being implemented by a local energy giant, said job cuts are because of a restructuring of the company, not because of falling revenue fuelled by plummeting global crude prices.

“The company has a new CEO. He has been in the company for long and knows it in and out, so he is making it more efficient. Many departments are being merged,” said Al Khalaf. 

“The layoff is good for cost-efficiency of the company though it may not be good for people who have lost jobs,” he added.

Many big international oil companies are also cutting jobs, he said, because they are suspending or cancelling projects as they may not be economically feasible any more due to the falling oil prices.

About bank loan defaults by people losing jobs, he said employers are not to blame. 

“Companies issue salary certificates and give an undertaking to banks that if an employee is laid off, they would inform them and transfer their terminal benefits,” said Al Khalaf.

A banking industry source working in the credit department of a local bank, confirmed that loan defaults were on the rise due to the layoff by an energy company — whose employees are, incidentally, treated by the banking industry as prized customers due to their huge pay and perks. “Yes, many cases of consumer loan defaults are being sent by banks to  police,” he said. 

Since banks give away unsecured personal or consumer loans — without collateral and only against transfer of a customer’s salary, they take two signed blank cheques from the borrower for the loan and interest as a guarantee.

In the case of default (usually if a loan remains un-serviced for three months, it is considered doubtful and the duration is reduced by banks to two months), the cheques are deposited in the bank for loan recovery.

The cheques bounce and a police case is filed. The first thing police do is impose a travel ban on the defaulter, summon the person and try to work out an amicable solution.

According to the banker, some Indians in debt who lost jobs got money here from their home to repay loans in full and that was how they escaped the ordeal others are facing.

“Indians mostly take loans to invest in their country so they are in a position to retrieve funds from there in emergencies,” said the banking industry source.

If police are not able to resolve an issue involving a dud cheque, the matter is sent to court. “There are many such cases in the courts today,” points out famous lawyer Yusuf Al Zaman.

“Bank loan default cases are in such large numbers that they are so obvious,” he said. “Banks must review conditions for consumer lending,” Al Zaman added, hinting that banks are to blame for social consequences of people not being able to repay debt or of rising indebtedness in society.

Giving away a huge consumer loan to merely on the basis of a salary transfer is irresponsible because employment can be volatile as it is only a matter of personal agreement between the employer and the employee, said the lawyer.

Many expatriates have lost jobs and stuck here, many with families because they must repay bank loans. “Many of them are not in a position to get a job because they have criminal proceedings going on against them for default,” said Al Zaman.

Insurance industry sources say all bank loans are insured but only against risks like the death of the borrower (barring suicide) or his total disability in an accident.

But bank loans are not covered against risks like the loss of job or his disappearance from the country, sources claimed.

Several schools are reporting an increase in parents’ request for transfer certificates for their children after the layoffs.