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Bahrain to Introduce Self-Sponsorship System in April

On March 7, 2017

According to Bahrain News Agency (BNA), a pilot project will be launched in April “to help thousands of illegal workers gain legal status in Bahrain.” The new law will operate like a “free visa” through which workers can sponsor themselves and work for multiple employers. The cabinet approved the work permit and plans to issue 48,000 permits within the coming two years. Workers can be employed by the hour, daily, or in other arrangements. Bahrain’s Labor Market Regulatory Authority (LMRA) chief executive Ausama Al Absi said it is a way “to regulate the free visa system.” There will be 2,000 free visas issued every month starting in April.

Although this will be the first step of its kind for the region, we must be careful in evaluating the new scheme. For example, workers will have to pay all the annual fees for work permits (BD 200, USD530) and health care (BD 144, $381). These are costs that would have been borne by the employer. Moreover, they are expected to pay BD30 (USD80) a month to the Labor Market Regulatory Authority, which is a huge gain for the country.

Al-Absi explains Bahrain’s move towards flexible sponsorship: “we could not fight the market forces, that’s why we came up with the flexible work permit system,” since the country already has an undocumented population in the market.

Undocumented workers pay at least 20 dinars per month to share a room with a dozen other workers. In addition, they now have to pay annual and monthly fees, which may be too prohibitive target group of low-wage workers, discouraging them from regularising their status.

Al-Absi says this system is aimed at “workers declared illegal as of and including September 20 last year and does not cover people on visit visas, runaways or criminals.” This discrimination in status fails to recognise that many undocumented workers have been forced into their status after “running away” from abusive employers, which means they are reported to be “absconding/runaways” by their employers and registered as such in the system. reached out to Bahrain’s General Federation of Workers Trade Unions (GFWTUB) for their take on the self-sponsorship system. Karim Radhi, secretariat and spokesman, said the Union endorses this step from the perspective of human rights and the right to free mobility granted by international human rights laws and labour agreements. He added that the  Kafala system does not only control mobility but also leads to confiscation of workers’ documents, “which is why Kafala qualifies as a form of forced labour according to international standards.” Radhi adds that self-sponsorship will make the working relationship better, especially in cases of work accidents, abuse, or unpaid wages, because workers will have a status that allows them to submit legal complaints.

“However, we must first put into consideration another law being applied simultaneously.” Radhi is referring to the health care fee that requires workers to pay 7 dinars per visit. This is on top of the annual healthcare fee required of each worker that has no sponsor. The Bahraini union also fears the self-sponsorship system will get employers to release those under their sponsorship, in order to avoid providing any of their labour rights, such as residency fees, health care, return tickets, overtime and end-of-contract compensation. In the end, this will create a competition in the job market between those sponsored by their employers and those on free visas. In result, the labour rights of workers in the country are likely to improve.

Some questions still remain unanswered about the self-sponsorship system. Will freelance contracts be required for such workers? If so, what is the obligations of the employer? Will the Bahrain government introduce a social security system that ensures contributions are made by employers for end of service benefits? Will there be minimum wage stipulation?

While on paper this is a positive move away from the Kafala system, the structural stranglehold that Gulf states have over its workers may null the benefits extended by this flexibility.

On another note, the LMRA plans to introduce an e-system to facilitate the recruitment of domestic workers. They are also negotiating with Indian officials to waive the $2,500 bank guarantee required for the recruitment of Indian workers, a scheme introduced two years ago to the ire of Gulf states.

Last year alone, Bahrain’s LMRA  collected BD153m ($405m) in fees and assisted 700,000 walk-in complaints.