The Kingdom’s sponsorship system was established in the 1950s to control the interaction between migrant workers and their employers. A migrant worker’s immigration status is associated with a certain employer or sponsor (kafeel) under the kafala for a predetermined amount of time.
In the past, the kafeel has been granted extensive authority over migrant workers’ movements. For the length of the agreed-upon contractual period, a migrant worker is permitted to work in the Kingdom; nevertheless, they are not permitted to leave the Kingdom or transfer their employment to another employer or sponsor without first getting written consent from the kafeel.
In addition, the Kafeel had the exclusive authority (other than the government) to obtain, renew, and cancel residence and work permits for migrant workers. The Kafeel had to report to immigration authorities if a migrant worker stopped working and certify that the migrant worker was provided with transportation back to his home country after the end of the work period.
Finally, the Kafeel can report to the authorities if a migrant worker has absconded from justice and under what circumstances the migrant worker will lose his documents and may be deported. The country is doing everything possible to ensure that everyone can come and contribute to the development, use job search sites https://layboard.in/vacancies/jobs-in-saudi-arabia/speciality/caregiver and increase your chances of success.
What has changed?
To replace the current sponsorship system, the Saudi Ministry of Human Resources and Social Development introduced the LRI on November 4, 2020. As will be explained below, the labor reforms bring about important modifications to the existing immigration and labor regulations.
Reform of Labor Laws
Resolution No. 51848/1442 (the “Resolution”), which was adopted by the Ministry of Human Resources and Social Development, shall apply to all work relationships regulated by the Saudi Arabian work Law, including the kafala system, as of March 14, 2021. The primary focus of the resolution is labor mobility. It will enable overseas employees to:
- Resign from their positions when their employment contracts expire without the employer’s or kafilah’s approval.
- Quit their job before their contract expires, as long as they have lived in the nation for a minimum of a year and given their employer 90 days’ notice. Furthermore, the Regulation permits migratory workers to switch jobs within the first year of employment under specific circumstances.
- Lastly, hitherto solely at the kafeel’s discretion, the ministry has established an internet platform where employers and employees can submit notices, job offers, and transfer requests. Therefore, save your time and start using websites like Layboard to get a job in Saudi Arabia.
Reform of Exit and Re-entry Visas
Requirements for foreign workers entering and leaving Saudi Arabia are likewise covered by the LRI. Before, a foreign employee had to get an exit and re-entry visa from their employer in order to leave Saudi Arabia. The LRI eliminates the need for employer or Kafeel consent to leave or return to the nation.
Instead, employees can use the Saudi government’s internet platform to make their own requests. As is typical in the GCC, Saudi officials may refuse to allow them to leave if they have unpaid bills or fines. After approval, the employer/kafeel will receive an automated notification upon the employee’s departure and return to the nation.
Reform of the Final Exit
Before the changes, Saudi Arabia’s immigration laws required kafeels, or employers, to sign a “final exit visa” for foreign workers who wanted to leave the country and return home. Employer/kafeel consent will no longer be needed in order to leave the Kingdom after the LRI is put into effect.
What information should employers be aware of?
In addition to the impending modifications to the Labor Law, businesses operating in Saudi Arabia should be mindful of three potential restrictions on its use.
First, the Saudiization system (Nitaqat) governs the hiring of foreign workers in addition to the Labor Law. Depending on the industry and workforce size, Nitaqat mandates that private sector firms hire a minimum proportion of Saudi citizens. The Ministry of Interior will need a letter of no objection from the existing employer if a foreign worker wishes to transfer their sponsorship to another employer, per the current Nitaqat standards.
The Ministry of Interior, which oversees the Nitaqat system, has yet to make a comparable notification, despite the Regulation’s pronouncement that the Labour Law would no longer contain such a provision. Employers should continue to be informed of the upcoming law before changing their hiring procedures, since the Ministry of Interior has not yet declared any modifications to immigration legislation outlining how it will apply LRI in relation to the issue of exit and re-entry visas.
Second, not all workers are covered by the Saudi Arabian Labor Law, other regulations apply to domestic and agricultural workers, certain maritime workers, athletes and coaches in clubs and sports unions, etc. As of right now, it is unclear if these worker groups will be covered by the LRI.
Thirdly, by incorporating non-compete agreements into employment contracts, companies can further safeguard their commercial interests. The Labor Law specifically permits non-compete agreements, subject to the restrictions outlined in Article 83. If an employee breaks their non-compete agreement, employers have a year from the date of the violation to sue for damages.
Human Trafficking and LRI
Companies are increasingly demanding to include social and human capital management goals into their internal business plans and policies as a result of the emergence of environmental, social, and governance (or “ESG”) investment criteria. For instance, shares of the UK security firm G4S were blacklisted by Norway’s sovereign wealth fund last year because of an “unacceptable risk that the company facilitates systematic human rights abuses” against its employees in the United Arab Emirates and Qatar.
Consequently, boards are finding it more and more crucial to comprehend how their organizations handle their supply chains. Thankfully, by fighting the underground market for smugglers and other abuses under the old kafala system that traffickers might exploit, LRI is contributing to the worldwide anti-trafficking movement.
