In a landmark decision, Saudi Arabia has abolished its decades-old Kafala system, a controversial labour sponsorship model that dictated the lives of millions of foreign workers. The June 2025 announcement marks a major step toward improving migrant welfare and labour rights in the Gulf kingdom.
The reform is expected to benefit nearly 13 million migrant workers, most of them from South and Southeast Asia, including India, Bangladesh, Nepal, and the Philippines.
“This reform redefines how migrant workers live and work in the Gulf, giving them long-denied rights and dignity,” a labour rights expert said.
What Was the Kafala System?
Derived from the Arabic word for “sponsorship,” Kafala was introduced in the 1950s to regulate the inflow of cheap foreign labour that fueled the Gulf’s oil economy. Under this model, every worker was tied to a local sponsor, known as a Kafeel, who controlled their residency, employment, and even exit from the country.
However, over time, the system became synonymous with abuse and exploitation. Employers could confiscate passports, delay wages, and restrict movement, effectively trapping workers in situations that human rights groups likened to “modern-day slavery.”
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For years, the International Labour Organization (ILO), Human Rights Watch, and other global advocacy groups urged Gulf nations to dismantle the Kafala framework. Reports of forced labour, non-payment of wages, and abuse of domestic workers—particularly women—sparked international outrage.
With migrants making up 42% of Saudi Arabia’s population, the system’s collapse comes after intense global scrutiny and regional precedent, as Qatar reformed its laws ahead of hosting the 2022 FIFA World Cup.
“This change brings Saudi Arabia closer to international labour standards,” said an ILO representative.
Part of Crown Prince Mohammed bin Salman’s Vision 2030
The abolition of Kafala aligns with Crown Prince Mohammed bin Salman’s Vision 2030, which aims to modernize Saudi Arabia’s economy, reduce dependence on oil, and attract global talent.
Under the new contract-based model:
- Migrant workers can change jobs without employer consent.
- They can exit the country freely without needing an exit visa or sponsor approval.
- Access to labour courts and complaint mechanisms has been expanded for better protection.
These changes are intended to create a more equitable and transparent labour environment while improving Saudi Arabia’s image as a progressive, globally integrated nation.
