Riyadh: In a sweeping move, Saudi Arabia has officially scrapped its decades‑old “kafala” sponsorship regime, freeing millions of foreign workers from longstanding restrictions that tied their legal status to individual employers. The announcement, made in June 2025 and confirmed in October, is expected to directly benefit about 13 million migrant workers, most hailing from South and Southeast Asia.
The reform is part of Crown Prince Mohammed bin Salman’s ambitious Vision 2030 programme to modernise Saudi society, diversify its economy and improve labour rights in line with international standards.
What the Kafala System Meant?
Kafala — an Arabic term meaning “sponsorship” — was introduced in the 1950s as a mechanism to govern foreign labour in the Gulf region. Under this system, migrant workers’ residency, employment and travel were tied to a local sponsor (“kafeel”), who held significant control over their movement and legal status.
Critics described it as a structure enabling exploitation: employers could confiscate passports, delay wages, restrict job changes or travel, and workers had little legal recourse. The system was increasingly likened to “modern‑day slavery”.
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What Changes Are Now in Effect?
Under the new labour framework announced by Saudi authorities:
- Migrant workers will now have the freedom to change employers without obtaining approval from the current sponsor.
- Workers will be able to leave the country without needing their employer’s consent or exit visa in most cases.
- A contract‑based employment model is being introduced, affording greater legal protections and enabling improved access to grievance mechanisms.
- The reform applies to an estimated 13 million migrant workers in Saudi Arabia, who make up nearly 42 % of the country’s population.
Why the Shift Now?
Saudi Arabia’s heavy reliance on foreign labour — particularly in sectors like construction, agriculture and domestic work — has long drawn international scrutiny. With roughly 13.4 million migrant workers in the Kingdom, most from India, Bangladesh, Nepal and the Philippines, the labour system had become a focal point of human‑rights concerns.
By dismantling the kafala regime, the Kingdom aims to bolster its global standing, attract investment, and align its labour practices with its Vision 2030 ambition of economic diversification and social reform.
Challenges and Implementation Ahead
While the legal reform marks a milestone, analysts caution that effective enforcement will be the real test. Organisations such as Amnesty International and Human Rights Watch warn that vulnerable groups — especially domestic workers — remain outside full protections and depend heavily on employer goodwill.
Workers and rights‑groups note that a culture of dependency on sponsors, lack of independent monitoring and weak redress frameworks persist. Without rigorous oversight, the promise of reform may be undermined.
Why This Matters?
For millions of migrant workers, this reform represents more than a legal change — it signals greater autonomy, the ability to seek better employment conditions and the freedom to return home or change jobs without employer permission. For Saudi Arabia, it’s a high‑stakes step toward labour modernisation and global labour credibility.
Yet the true measure of success will be how well the reforms translate into improved working lives on the ground and whether other Gulf states follow suit.