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The term Kafala, meaning “sponsorship” in Arabic, came to represent a system across the Gulf under which employers exercised almost complete control over migrant workers.
Saudi Arabia has officially abolished its decades-old Kafala system, a labour sponsorship model that long governed the lives of millions of migrant workers. The landmark decision, announced in June 2025, marks a major step toward improving labour rights and migrant welfare in the kingdom. The reform is expected to benefit nearly 13 million foreign workers, mostly from South and Southeast Asia.
What is Kafala System?
The word Kafala, which means “sponsorship” in Arabic, came to symbolise a way of life across the Gulf, where employers held near-total control over migrant workers. They could decide whether a worker could change jobs, leave the country, or even seek legal help.
Introduced in the 1950s, the Kafala system was created to manage the influx of low-cost foreign labour needed to build oil-rich Gulf economies. Every foreign worker was tied to a local sponsor, or Kafeel, who controlled their employment, residency, and legal status.
Concerns related to Kafala System
Over time, the system led to serious abuses. Employers could confiscate passports, delay or withhold wages, and restrict workers’ movements. Without permission from their sponsor, workers were often unable to change jobs, return home, or report mistreatment to authorities.
Human rights organisations frequently described the Kafala system as a form of “modern-day slavery,” arguing that it stripped workers of their basic freedoms and left them highly vulnerable to exploitation.
International pressure for reform
The system drew increasing criticism from international labour bodies, foreign governments, and human rights groups. The International Labour Organization (ILO) and several NGOs accused Gulf nations of fostering conditions that enabled forced labour and human trafficking.
Saudi Arabia, with an estimated 13.4 million migrant workers — about 42 per cent of its population — has long depended on foreign labour for domestic work, construction, agriculture, and other industries. Many of these workers come from India, Bangladesh, Nepal, and the Philippines.
Domestic workers, especially women, were among the most affected, often living in isolation and facing limited legal protection. Reports from rights organisations have documented cases of abuse, overwork, and unpaid wages.
Saudi Arabia’s decision to dismantle the Kafala system follows years of international scrutiny and pressure for reform. It also comes after similar steps taken by other Gulf countries, such as Qatar, which revised its labour laws before hosting the 2022 FIFA World Cup.
How abolishing Kafala System will impact migrant workers
The reform is part of Crown Prince Mohammed bin Salman’s Vision 2030 plan -an initiative aimed at diversifying the Saudi economy, reducing dependence on oil, and presenting a more modern and progressive global image.
Under the new contract-based employment model, migrant workers will have greater freedom and autonomy. They can now change jobs without needing their employer’s approval and leave the country without requiring an exit visa or sponsor’s consent, ending a long-standing restriction that often trapped workers in abusive situations.
Additionally, access to labour courts and complaint mechanisms has been expanded, enabling workers to report violations and seek justice more effectively.
These measures are intended to bring Saudi Arabia’s labour practices closer to international standards and make the kingdom a more attractive destination for skilled professionals and global investors.
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