Saudi’s Labour Reform Initiative: An Overview

Saudi Arabia announced a series of labour reforms over the last few years that claim to loosen Kafala controls and provide more freedom of movement to migrant workers. While largely excluding the country’s most vulnerable workers — domestic and agricultural workers — the reforms seemed promising for the roughly 8.5 million migrant workers who fall under the scope of the labour law.

On paper, workers covered by labour law were granted basic rights for the first time — namely the right to transfer jobs and leave the country without their employers’ permission. These processes were also digitised, theoretically making them more efficient and more accessible. The absconding regime (referred to as “absent from work” in the law) was also reformed to enable accused workers to rectify their status and change employers, rather than face immediate detention and deportation.

The Ministry of Human Resources and Social Development (MHRSD) announced in April 2024 that it will also revise absconding regulations for domestic workers, facilitating easier employment transfer under some conditions. These revised regulations were set to take effect in July 2024, per the MHRSD, though it is unclear whether they have been implemented yet.

The impact of these reforms on migrant workers remains unclear, with sparse information provided by the government. In May 2024, the MHRSD reported that at least one million migrant workers have benefited from the Labour Reform Initiative (LRI) services since its launch. However, the MHRSD did not provide any details about which LRI services migrant workers benefited from, nor a demographic breakdown. According to the US government’s Trafficking in Persons (TIP) 2024 report, “305,444 foreign workers changed employers without the consent of their current employer.” The MHRSD also claimed that the LRI had led to a 50% decrease in migrant workers’ labour disputes between March 2021, when it was first launched, and May 2024.

While Ministry data indicate that thousands of workers have availed of these reforms, in practice employers still retain a large degree of control over workers under their sponsorship. These controls are largely in the form of exit visas that employers can issue for virtually any reason, which force workers to leave the country within a set period of time unless they successfully file a labour complaint. The labour complaints system has also seen some reforms, but access to justice mechanisms remain weak and make it difficult for workers to challenge employers’ actions.

The labour reforms, passed through amendments to the labour law and ministerial decisions, have been digitally operationalised through Qiwa, an e-government platform available in only Arabic and English (reforms for domestic workers are set to be operationalised through Musaned). Consequently, workers must be both technologically literate and proficient in either Arabic or English to navigate the digital systems. Many low-income workers in particular require additional support that is available at a price from private agencies – that provide services to enable online complaints – which they may not be able to afford.

Kafala reform in phases

The first phase of reforms occurred in March 2021 under the Labour Reform Initiative (LRI). On paper, the LRI allowed migrant workers covered under the labour law (which excludes domestic workers) to:

1) transfer jobs without the employer’s consent, as long as they have been in Saudi for at least one year and;

2) leave the country without permission from their employers.

The second phase also targeted only migrant workers covered under the labour Law. These reforms came into effect in October 2022 with the relaxation of absconding regulations, which entitled workers charged with absconding to a 60-day grace period to transfer employment or request a final exit visa and leave the country. If workers fail to take these actions, they will be fined, deported and blacklisted from coming back to the country on a work visa. Previously, absconded workers were subject to immediate administrative detention and deportation.

Changing Employers

Once a migrant worker receives a job offer, they accept or reject it, all without the knowledge of the current employer. Herein lies the crux of the reforms and the most beneficial aspects of it to workers. The current employer will only be informed if the migrant worker accepts the offer. Then, Qiwa automatically begins a countdown of the number of days before the migrant worker is transferred to a new employer. The number of days depends on the migrant worker’s contract and the notice period specified in it. The notice period cannot exceed 120 days..

If their current employer is feeling benevolent, they might allow the worker to transfer without issue. Through Qiwa, employers can reduce the notification period to 1 day, effectively transferring the worker almost instantly. However, if the current employer is against the transfer, they can punish the worker by issuing final exit visas.

Migrant-Rights.Org (MR) spoke to three migrant workers who were threatened with exit visas if they accepted a job offer via Qiwa. One migrant worker told MR that “exit visas are the new absconding reports.” Another said “I’m currently stressed because I received a job offer but my old employer is threatening of giving me a final exit instead.”

Exit visas

Exit visas have historically been deployed to pressure, manipulate and abuse migrant workers. Workers wishing to leave Saudi for a break from their work or to visit their homes had to secure approval from their employers to obtain an exit and re-entry visa. While some employers allowed their employees to come and go as they pleased, the system enabled employers to weaponise mobility. Workers have been denied their exit for perceived slights or simply as a show of power.

Employers can issue final exit visas in the middle of an employment contract and without prior notice using Absher. The migrant worker must leave the country within 60 days, with the employer responsible for the return ticket. Workers are entitled to receive their salaries, dues, and end-of-service benefits before they leave and to file a labour complaint within this period. Though workers can object to the final exit visa, the justice system is riddled with barriers to  access and moves slowly, making it challenging for migrant workers to file a complaint, secure a hearing, and resolve a labour dispute case within this time-frame. Migrant workers who do not leave the country within 60 days will become undocumented and subject to deportation.

Still, many migrant workers leverage the LRI rules and other administrative requirements to resist unwanted exit visas. Two of them filed a complaint, in person, with the Labour Office, showing a job offer from a new employer and proof of residency in Saudi for at least one year, as required by the LRI. With these documents, the Labour Office issued a letter recommending the cancellation of the exit visas that they presented to the Ministry of Interior. While the MoI has final authority on cancelling the visa, both workers succeeded and were able to transfer to their new employer using the LRI as a basis. Another worker, a non-Arabic speaker, said he was lucky to find a Labour Office staff member who spoke English and was able to help him. Without Arabic knowledge or the help of an English speaker, he was not sure if he would have been able to advance his case.

Exit visas, like any bureaucratic process in the labour migration system in Saudi, can be manipulated and weaponised by employers to discipline their employees. However, migrant workers often find resourceful ways to use the system to their advantage, to the degree they can. In the cases mentioned above, migrant workers leveraged these processes to stay in the country and switch to another job, something that would have been difficult to achieve in previous years.

Exit visas and the LRI promises

The LRI granted migrant workers the right to issue an “exit visa” or an “exit and re-entry visa” for themselves through Absher. Migrants have to pay the SAR200 visa fee (which was only paid by employers in the past) and wait 10 days before obtaining it. Employers will be given a notice once an exit visa is requested, and they have 10 days to raise any objections they may have with the MHRSD.

Even after the LRI, migrant workers who request a final exit visa in the middle of their employment contract will be blacklisted and permanently banned from entering the country. Meanwhile, employers can issue an exit visa at any time during the employment contract.

Some workers worry that issuing an exit visa on their own might antagonise their employer. According to one lawyer MR spoke to, once an employer receives a notification (in the form of a text message) that their employee has requested an exit visa, the employer can go in person to a Labour Office (an office of the MHRSD) and submit a request to cancel the visa. Given the inherent biases in the system, employers will most likely be granted their request, or at the very least protract the process to subject workers to financial and psychological stress.

Workers can only obtain a final exit visa without Absher sending a notification to their employer if they have an absconding report against them (see below Phase II).

The right not to renew a contract or terminate employment

If a worker or employer does not want to renew an employment contract, they have to give the other party a notice as per the conditions in the work contract. Workers have the right to terminate their employment contract during the probationary period without notice. Moreover, workers who wish to terminate the contract before it ends have the right to do so as long as they compensate the employer for early termination by paying the agreed upon amount as stated in the contract. In practice, the compensation is usually set at two months wages, but the two parties can also agree to terminate the contract through mutual agreement.

Qiwa has introduced a streamlined and relatively user-friendly procedure to terminate employment. Migrant workers can submit a request to:

1) not renew their contract or terminate their contract before it ends, provided they give the employer the specified notice period; Or

2) terminate their contract during their probationary period. Workers can submit requests for non-renewal and termination via Qiwa and employers cannot reject it. However, in retaliation, employers can still issue an exit visa during the notice period.

Phase II: Updating absconding (absent from work) regulations

 Note: Labour and immigration laws in Saudi Arabia  use the term “absent from work” in place of absconding. The terms “runaway” (huroob in Arabic) were previously used by officials, but are no longer in use.

In October 2022, the MHRSD updated its absconding regulations, loosening its efficacy as a retaliatory measure against workers.

Employers can still file absconding reports, but they no longer render migrant workers undocumented automatically. Moreover, the new absconding reports can only be issued against workers who do not have, or failed to sign their e-contract (it is the responsibility of the employer to issue e-contracts and follow up with their workers to ensure they sign on it).

Once an absconding report is issued, workers have a 60-day grace period to adjust their status, either by finding a new employer, or obtaining a final exit visa. If workers fail to avail of the grace period, they are considered absconders and are subject to fines, detention, and deportation.

Though reforms to the absconding regime are extensive, the new system still enables grave rights violations. When an employer issues an absconding report, they sever their employment relationship with the worker, effectively denying the worker any claims to end-of-service benefits, bonuses, injury claims, or any other remuneration. Within the grace period, the worker has the right to file a complaint against their employer through the MHRSD labour dispute system if they believe the absconding charges are malicious or false.

However, labour dispute procedures are not always straightforward and time-consuming. Even if disputes can be filed online, workers may need to follow up in person at the labour office to ask for a case status or expedite a hearing date, which can be a costly endeavour as workers must pay for transportation, and any translated materials needed, in addition to taking time off work for those who have secured new jobs. In the 60-day grace period, the worker would’ve lost his or her job, and if they have no savings, they cannot spend their time chasing their case with MHRSD. Labour disputes are also lengthy processes, often requiring more than 60 days to be resolved. In many cases, such as when the phone number of the worker is not updated or linked to their account in the Saudi government system, workers are not notified that they have a case or an absconding report filed against them unless they log into their Qiwa portal, giving them less time to file appeals or use the grace period to transfer to another employer.

Still, this new update has made absconding less appealing to employers to use as a retaliatory measure. One employer told MR that it is now more effective to issue final exit visas to discipline workers rather than an absconding report. Final exit visas can be used to end the employment relationship without having to terminate the contract through labour law mechanisms. Exit visas can be more appealing to unscrupulous employers than termination of contracts. Workers with exit visas are given a certain period of time to leave the country. If they fail to do so, their status becomes irregular, and they will be subject to detention and deportation. Unlike exit visas which by law have barely any consequences, and are seen as a privilege for employers, terminating contracts in the middle of employment can be litigated easier in the justice system.

The Next Steps For Genuine Labour Reform

Although the reforms were mistakenly praised as the end of the Kafala system in 2021, the Kafala’s essential components—where workers remain tied to and controlled by their employers—persist. The exact modes of control may have shifted, but the power imbalance remains heavily in employers’ favour. While some important advances have been made, these gains are undermined by employers’ authority to issue final exit visas, the inaccessibility of Qiwa to the majority of migrant workers, and weaknesses in the justice system. As highlighted in Migrant-Rights.org’s analysis of reforms in Qatar and its exploration of other temporary migration schemes, the Kafala system cannot be reformed or fixed piecemeal — it must be completely dismantled.

To do so, the Saudi government must centre labour and human rights in line with international standards; take into account workers’ experiences, including input on seemingly sleek but hard to navigate platforms such as Qiwa, Musaned and Absher; ensure there are no loopholes in the system for employers to exploit and abuse; govern with transparency and accountability, including through releasing detailed data on workers leaving the country or transferring or terminating employment without employers’ approval; and build the capacity of the MHRSD and labour court system to handle labour disputes in a speedy, fair and non-discriminatory fashion.

Domestic interests can be leveraged to pursue these changes. While external pressures, including human rights concerns and international reputation —  in particular, the country’s ranking in the US Trafficking in Persons report — contributed to the current reforms, local concerns have been the primary catalyst. According to one Saudi official, the reforms intended “make Saudis more attractive to private employers who would rather hire foreigners over whom they currently have greater control.” At the same time, the MHRSD has also framed these reforms as a way for businesses to reduce the cost of recruiting migrant workers in the country. According to MHRSD documents, the measures also aim to reduce the number of workers with irregular status in the region, estimated to be around four million workers in 2019. With both the government and the private sector standing to benefit from these changes, there is a strong foundation to advocate for labour and migration policies that fully safeguard the rights of migrant workers.