Saudi Arabia next to scrap sponsorship system

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Filipino workers sit in an office in Saudi Arabia. Photo -

Deputy Labour Minister for workers affairs Ahmad Al-Humaidan announced on Thursday the government is taking practical steps aimed at scrapping the individual sponsorship (kafala) system.

“We have already begun changing some technical terms related with the sponsorship system, like changing the term ‘transfer of sponsorship’ (naql kafala) to ‘transfer of services.’ Other steps included preventing sponsors from holding passports of foreign workers and cancelling the condition to obtain the sponsor’s approval for workers to bring their families to the Kingdom,” he said.

The Saudi daily Al Eqtisadiah business newspaper quoted the deputy minister as saying while addressing a seminar on private health firms in Riyadh.

Al Humaidan insisted the ministry has replaced several provisions in the kafala system with new regulations that govern the relationship between the employer and the foreign worker. “If you look at any of these regulations, you can’t see anything that is pointing to the sponsorship system. The ministry was able to remove all the restrictions imposed by sponsors on their workers,” he explained while adding that currently there are no obligations between the sponsor and the foreigner except those that come under the framework of an employer and employee.

However, the deputy minister denied that scrapping the sponsorship system and easing restrictions on the labour market will lead to further complications. “It does not mean that a foreigner can enter the Kingdom and then search for a job in the local employment market. This doesn’t make any sense and should not happen in the Kingdom,” he said, while stressing that the Kingdom wanted to follow the example of the most regulated and systematic labour markets in the world, such as the United States in this respect.

Al Humaidan also emphasised that the ministry was striving hard to protect the rights of foreign workers without harming the interests of their employers.

According to media reports, the ministry had completed a study  in March on prospects of canceling the sponsorship system and replacing it with recruitment companies. The study concluded that the move might lead to the complete scrapping of the sponsorship at a later stage. The study took five years to complete and includes rules and regulations for the new recruitment companies.

The Saudi Council of Ministers is expected to approve the proposals before the end of 2012. The study suggested the formation of a commission under the ministry to look into foreign labour issues and put an end to the outdated traditional sponsorship system.

According to the new system, an employer would not be responsible for the wrong doings of a foreign worker outside his work.

The proposed study advocates the introduction of a mandatory insurance policy to protect financial rights of foreign workers and employers. The scheme, which may act as an effective tool to end the justification for introducing the sponsorship system, would cover the damages caused by a foreign worker, payment of unpaid salaries and provision of air tickets.

Qatar announced earlier this month it is considering a revamp of its controversial sponsorship system for foreign workers in the country and introduce a new system that is in line with international labour standards.

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