Saudi Arabia’s Transition Beyond the Kafala System

By Aimee Li ‘28

In June 2025, the Saudi Arabian government officially repealed the Kafala labor system, which, for over five decades, has managed the residency and employment of migrant workers in countries in the Gulf Cooperation Council (GCC). This labor framework, established in the 1950s as a response to the swelling demand for cheap labor, tied the legal rights of migrant workers to local sponsors, giving workers little autonomy and alleviating the state’s administrative responsibility of managing migrant workers. Most migrants come from regions in South and Southeast Asia that have high poverty rates, and moved to wealthy Gulf nations in the hopes of elevating their family’s financial state. Yet, they receive little protection from the host country’s labor law as a result of the Kafala system, and often suffer systematic abuse and coercion.

In the 1950s, GCC countries, prospering from oil, solicited temporary foreign workers who could supplement labor for the thriving economy’s construction projects. These nations created the Kafala system to protect the safety and well-being of workers from abroad. According to the Council on Foreign Relations, when the system was newly established, it mainly governed workers from neighboring Arab countries. However, during the oil boom in the 1970s, the states’ growing demand for cheaper labor drew in non-Arab workers from countries in the Global South, specifically in Africa and South Asia.

The Kafala system, which translates to “sponsorship” in Arabic, has come to enshrine severe power imbalances, in which employers enforce absolute control and violate workers’ human rights. For example, migrant workers require permission from their sponsors to change jobs and to leave the country. Some organizations, such as The Lawfare Institute and the Human Rights Watch, corroborate, characterizing the labor system to be a “violation of human rights.” According to Walk Free, the system “leaves migrant workers vulnerable to exploitation.” ImpACT International echoes this sentiment, describing the system as “modern-day slavery.” While the GCC has been profiting from the labor migrants, local agencies have documented numerous reports of violence, sexual assault, and exploitation by employers. Many female workers who attempt to escape have become victims of sex trafficking, according to the South China Morning Post. Past promises for reform have fallen short; although some countries claimed to have improved the labor system, there remains a continuous lack of policy protecting workers’ rights.

Calls for reform spread after preparations for the 2022 FIFA World Cup incited international scrutiny. FIFA had agreed to host the 2022 World Cup in Qatar without any conditions regarding the legal protections for laborers. Though the Kafala system was reportedly abolished in Qatar in 2017, critics from Amnesty International claimed that the reforms were not properly enforced during preparations for the World Cup. Per the Council on Foreign Relations, workers were forced to toil under temperatures above 100 degrees Fahrenheit, building pavements and stadiums in preparation for the games.

More broadly, in the past decade, thousands of workers have reportedly died due to harsh working conditions. The Human Rights Watch stated that the claims that the gulf states have heightened protections against worker abuse were “grossly inaccurate and misleading.” Workers received little to no compensation or recognition for enduring abuse and exploitation. The injustice of the system has even discouraged victims from filing formal complaints or reports against their employers. An unnamed worker interviewed by the Human Rights Watch shared that litigation is often difficult because wage abuse cases “require constant follow-up,” and“companies don’t obey court orders.”

In place of the Kafala system, Saudi Arabia has implemented a contractual employment model aligned with international labor standards, granting much more freedom to workers, as a part of Vision 2030, a blueprint launched in 2016. According to its mission statement, Vision 2030 aims to diversify and develop Saudi Arabia’s economy while protecting all workers amid economic liberalization. The government has framed the reform as an enhancement of worker protections and a step towards modernizing the economy, marking a turning point for Saudi Arabia. The new labor regime works towards elevating working and living conditions for around thirteen million migrant workers who have been under the Kafala system. According to ImpACT International, this reform aims to “create a fairer labor market, attract skilled global talent, and support Saudi Arabia’s Saudization policy,” a policy striving to nationalize the workforce. Employment will now be based upon legal contracts that allow workers to report abuse without fearing retaliation from sponsors.

Although reforms are not fully implemented yet, the Middle East Briefing described them as marking the end of “the era of sponsorship.” The success of the reform in Saudi Arabia could potentially influence neighboring countries as a growing number of Gulf countries are straying away from sponsorship-based labor systems. While some supporters of the Kafala system claim that abolishment could disrupt the economy, critics argue that all Gulf countries should work beyond reform to completely obliterate the system.