S Arabia plans to end ‘kafala’ labour system

Staff Correspondent

29 October, 2020 12:00 AM printer

Kingdom of Saudi Arabia (KSA) is set to announce major labour reforms that could effectively end its controversial ‘kafala’ labour system for foreign workers, says a report published by Arabian Business, quoting a news outlet close to the government.

New rules governing foreign labour are scheduled to be unveiled as early as next week and would be applied from the first half of 2021, the online Maaal newspaper reported, citing an unidentified source.

According to Maaal, the changes were to be disclosed earlier this year but were delayed by the pandemic.

The ‘kafala’ system, applied to foreign employees in Gulf Arab countries for decades, has been criticised in and outside of the oil-rich Gulf state as a form of indentured servitude.

Some economists argue that it is embedded in an imbalanced labour market, where private employers hire cheaper and more easily exploitable foreign workers albeit unemployment is rising in Saudi Arabia.

Foreign workers in Saudi Arabia currently must be tied to a sponsor whose permission they need for changing jobs, opening a bank account or even for leaving the country on vacation.

Several neighbouring countries of KSA have taken steps to reform kafala labour system without fully ending it.

Maaal reported that the kingdom’s Ministry of Human Resources and Social Development didn’t immediately respond asked for a comment.

However, the ministry is set to hold a press conference next week to outline reforms to “increase the competitiveness, attractiveness, and flexibility of the Saudi labour market in accordance with international standards,” according to the invitation sent to journalists from the ministry.