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According to reports, Saudi Arabia has ended its 50-year-long worker sponsorship program, known as the Kafala system, in a landmark labor reform.
The decision, first announced in June 2025, will impact the rights and lives of around 1.34 crore migrant workers – the majority of whom are from Southeast Asia and South Asia, including Indians, who live in the Middle Eastern country, India Today reports.
What is the Kafala system?
According to the report, implemented in the 1950s, the Kafala system, which literally translates to sponsorship system in Arabic, gave employers complete control over their employees’ legal status, residence, when or whether they could leave the country, seek legal help or even change jobs. The system tied each sponsor or ‘Kafeel’ to a migrant worker.
Why was the Kafala system criticized?
Originally designed to control the flow of low-wage, migrant workers into the oil-rich country, the system began to be abused. The rights group criticized the policy as “modern slavery” amid reports of employers exploiting workers, restricting their movements, refusing wages, delaying payments and confiscating their passports, it said. Additionally, the allegedly abused workers were unable to seek help or even return home.
Which employees are likely to be impacted?
Saudi Arabia currently has an estimated 13.4 million foreign workers. They constitute about 42 percent of the state’s population as it depends on migrants for construction work, agriculture, domestic work and more.
Most of the estimated 1.34 crore workers are from Bangladesh, India, Nepal and the Philippines.
Demographically, the group most likely to benefit from the reforms are women engaged in domestic work. Global rights groups have repeatedly highlighted the abuses of domestic workers under the Kafala system.
Why the change now?
Saudi Arabia is not alone in reforming its migrant labor policies. It said that in 2022, under immense global pressure due to its designation as host of the FIFA World Cup, Qatar also abolished similarly criticized staffing rules.
The report said the Saudi decision comes from Crown Prince Mohammed bin Salman’s ‘Vision 2030’, which aims to reduce the country’s dependence on oil and re-brand it as a modern and progressive country.
It said the country aims to bring its labor standards at par with the global system to attract more foreign investors and skilled professionals.
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