Ijarah

IjÉrah based contracts Definition of ijÉrah The literal definition of ijÉrah is “the reward given for service rendered”. It is derived from the root word ’ajjara – to recompense, compensate or to give a consideration or return. Technically, ijÉrah has two different connotations: The first meaning is “to employ the services of a person on wages given to him as a consideration for his hired services”. In this context, the employee is called ajÊr (worker) or musta’jar (hired). This type of ijÉrah includes every transaction where someone else hires the services of a person. (Doctor, lawyer, teacher or any person who can render some valuable services). The second meaning is “to transfer the usufruct of a particular property to another person in exchange for a rent claimed from him”. In this context, the owner of the leased property is called mu’jir (lessor). This type of ijÉrah includes leasing all types of proprieties and assets. In both types of ijÉrah, the beneficiary of the services of the worker or of the leased property is called musta’jir (hirer/lessee) and the compensation payable to the employee/lessor is called ’ujrah. The classical jurists have given several definitions of ijÉrah. The ÍanfÊs defined it as a contract pertaining to usufruct with compensation. The shÉfÑÊs defined it as a contract over a desirable, known, permissible, and accessible usufruct, in exchange for a known compensation. Finally, the malikÊs and the ÍanbalÊs defined it as the transfer of ownership of a permitted usufruct for a known period in exchange for compensation. From the above definitions, it can be said that ijÉrah is “a contract for the transfer of ownership of usufruct for compensation”. Whereas, some scholars say that “It is a sale of a known usufruct for a known compensation”.

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Related Terms IjÉrah and bayÑ: The difference between ijÉrah and bayÑ is that ijÉrah is a sale but only of the usufruct, whereas a normal bayÑ (sale) contract is a transfer of the corpus. A...