Saudi Arabia reforms widely criticised kafala system
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Riyadh Saudi Arabia King Abdullah Financial District

New labour laws designed to reform a system of “modern slavery” in Saudi Arabia have gone into effect as the Gulf state provides workers with greater job mobility and attempts to become a more “attractive” employment environment for foreign talent.

In November 2020, the Ministry of Human Resources and Social Development (MHRSD) launched the Labor Reform Initiative (LRI) which amends the kafala – or sponsorship –  system, described as a modern form of slavery tying expatriate workers to their Saudi employers.

Seen as exploitative by human rights campaigners, the state’s sponsorship system allows employers to report employees as having “absconded” should they leave their job without consent, resulting in the worker potentially being arrested and deported by Saudi authorities.

Under the reforms, after completing one year of employment, or upon the expiry of the work contract, workers will be able to enter and exit the kingdom and transfer between employers without their former employer’s consent.

MHRSD has stated the LRI will improve the efficiency of the working environment in Saudi Arabia, decrease the number of disputes between employers and employees, and enhance the competitiveness of the local labour market.

“Through this initiative, we aim to build an attractive labour market and improve the working environment,” MHRSD Deputy Minister Abdullah bin Nasser Abuthunain said last year.

Rights groups have highlighted that the reforms do not abolish the exit permit altogether, however. Workers must still submit a request to the MHRSD to exit the kingdom with the ministry notifying the employer electronically of their workers’ departure.

The announced reforms could be a step in the right direction, they by no means dismantle kafala in full

Time will tell if or how employers can hinder this process, according to Migrant-Rights.org, which also highlighted that, under MHRSD guidelines, migrant workers will be required to pay fees to obtain an exit-re-entry visa, currently $53.

Saudi Arabia is home to more than 10 million foreign nationals and it is estimated that only 6.7 million migrants – those working in the construction, hospitality, oil and gas, and infrastructure sectors – will benefit from the reforms.

The LRI does not apply to domestic workers, farmers, gardeners, drivers, and security guards, or those on short-term visas, according to Equidem, a UK-based human rights and labour rights charity. The new regulations also do not apply to the kingdom’s 3.7 million domestic workers.

“Saudi Arabia has one of the most abusive versions of the kafala system, and while the announced reforms could be a step in the right direction, they by no means dismantle kafala in full,” said Adam Coogle, deputy Middle East director at Human Rights Watch.

“Most important, millions of domestic workers are denied the proposed reforms, leaving them at the mercy of their employers as they work out of sight in private households.”

The Kafala system is also found in Bahrain, Kuwait, Jordan, Lebanon, Oman, Qatar, and the United Arab Emirates, but there have been growing calls for these Middle Eastern countries to reform their labour laws due to widespread exploitation and abuses such as the withholding of passports.

Last summer, Qatar introduced similar amendments as Saudi Arabia, while also becoming the first country in the region to adopt a non-discriminatory minimum wage. The UN’s International Labour Organization said the change “effectively dismantles the kafala sponsorship system and marks the beginning of a new era for the Qatari labour market”.

Migrant-Rights.org, has said it is “critical that these reforms [in Qatar] are followed by stringent implementation and prosecution of those [employers] who fail to comply”.

Earlier this month, the European Parliament voted to introduce new laws that would hold companies accountable when their actions infringe human rights.