The Kafala System and Abuse of Guest Workers

by Alexandra Bixler 


Last week, Saudi Arabia made sweeping changes to the kafala system. Foreign workers are now allowed to switch jobs and travel without their permission of their employers.[1] The kafala system is a system used to sponsor guest workers in nations like Bahrain, Kuwait, Lebanon, Qatar, Oman, Saudi Arabia, and the UAE. While the kafala system involves “contractual agreements” between workers from sending countries and employers from the receiving countries, the scale of power is almost completely tipped away from the guest worker. Critics often brand the system as “modern slavery.”  Receiving countries, enjoying the riches of a steady oil surplus and bustling metropolitan areas, regularly rely on guest workers for care, housekeeping, and manual labor. In fact, these nations rely on foreign workers to such a great extent that they make up more than 50% of the population in Bahrain, Oman, and Saudi Arabia [5]. While laws are in place to prevent abuses of migrant workers, these laws are seldom enforced, and passports are routinely confiscated from migrants for arbitrary reasons  [5] 

Since 2016, the bodies of 473 women migrant workers have been recovered in the Arabian Peninsula. 175 of these bodies were found in Saudi Arabia alone. A few of these deaths led to global outrage [3]. In 2018, Phillipine worker Joanna Demafelis was found dead in a freezer in Kuwait. The Phillipine president, Rodrigo Duterte, then suspended the deployment of new workers entering Kuwait. While the two countries cooperated with one another to prosecute Demafelis’ murderers, this collaboration turned sour when video footage showing Phillipine forces rescuing allegedly abused maids was leaked. This angered Kuwait, who believed this was a violation of their “sovereignty” and claimed in 2018 that they would recruit more domestic workers from Ethiopia instead [3]. Kuwait and the Philippines reached an “agreement” later on, but ultimately conditions for guest workers in Kuwait did not change a considerable amount. In December 2019, another Phillipine employee Jeanelyn Villavende was sexually assaulted and also killed by her employer. On December 30th, 2020, the Kuwaiti criminal court voted to hang the woman employer accused of torturing Villavende due to “jealousy.” However, her husband only received 4 years in prison.[2] 

Nodi was a 13-year-old girl from Dhaka. She falsely claimed she was 27-years-old so she could be placed as a domestic worker in Saudi Arabia [3]. After being tortured by her employer, she died in the hospital. Nodi’s mother, Beauty Akhter, claimed Nodi was tortured from the day she arrived in Saudi Arabia and was never even paid for her labor [3]. While Nodi’s parents knew of the abuse she was receiving, Rahman Lalon, owner of the recruiting agency Dhaka Export (RL-275) threatened the family in various ways rather than attempt to resolve the problem. He was later arrested. The deaths of these women are not merely a few unfortunate incidents, but representative of a wider problem. Bangladesh’s Ministry of Expatriates’ Welfare and Overseas Employment reported that of the roughly 110 female domestic workers they spoke to returning from Saudi Arabia, 35 percent were physically and sexually abused and 44 percent were not paid regularly.[3] 

Time and time again, nations in the Arabian Peninsula have claimed to “reform” the kafala system, or even abolish it, when in reality, the system remains practically the same. Time will tell how much Saudi Arabia’s system for guest workers really changes. Unfortunately, receiving nations have little incentive to change the status quo. In fact, as will be discussed later, their economies rely on it. Likewise, while sending countries may want to change the status quo, their economic reliance on the Arabian Peninsula for economic remittances makes this difficult in practice. Remittances from countries like Kuwait account for $34 billion to the economy in the Philippines [6]. However, oftentimes, the most vulnerable workers do not receive the economic security from the Gulf they initially seeked. After workers pay the expensive recruitment costs, they often receive less money and experience worse conditions than promised. To keep their families from worrying about them, migrant workers often pool their money together and borrow remittances  to send to their families. They may even go as far as sending their family pictures of beautiful waterfronts, rather than their dilapidated apartment without running water [11]. 

Receiving countries in the Arabian Peninsula have little incentive to change the current sponsor-sponsee relationship, where Gulf employers sponsor guest workers, with sending nations. Given the political infrastructure of the Arabian Peninsula, nations like Kuwait place a strong emphasis on prestigious public sector jobs for natives, which leads to the outsourcing of cheap, lower-level labor [5]. Citizens also feel entitled to the wealth that oil provides in their nation for the simple reason that they were born there. Thus, they feel foreign workers are  entitled to neither citizenship nor these oil benefits. Without the possibility of citizenship, their “temporary” status, and the desperation of foreign workers, few mechanisms are in place to monitor the conditions workers experience. Thus, the receiving state is able to exercise a great deal of control over its employment “contracts.” Some laws in place further enforce the power inequalities between the worker and employer. For example, the 1959 Kuwait Residency Law says aliens can be deported if the ministry of the interior objects to their presence for “security or moral reasons.” This description is vague and arbitrary, and makes it easy for foreign workers who attempt to stand up for themselves subject to deportation [5].  Additionally, the Kuwaiti Labor Laws of 1964 do not apply to domestic workers, even if they face some of the worst abuses. However, even if an employee does claim their rights were violated under the Kuwaiti Labor Laws, they would still have to pay the costs associated with the recruitment agencies responsible for placing them once again [5]. David Mednicoff, the Department Chair of Near Eastern Studies at the University of Massachusetts-Amherst, argues that Gulf governments and employers do not see the abuse of workers as a human or civil rights issue, but rather a contract issue [5]. These beliefs make it difficult to reform the kafala system on a larger-scale. 

Another barrier to significant reform in the kafala system is Gulf nations’ over-reliance on the public sector, oil more broadly, and inefficient economic systems with no chance at long-term success. Crony capitalism–a system where business success is dependent on personal ties to the government, rather than merit–dominates oil-centered economies in the Gulf and is blamed as one of the causes for economic dissatisfaction and underdevelopment in the Middle East North Africa (MENA) region [7]. For example, to find prestigious public sector jobs, social services or get into college, people in the Arabian peninsula resort to bribery. Additionally, featherbedding is the process of hiring more workers than needed for the sake of employing more people, even if doing so is economically inefficient [7]. In the Gulf, public-sector state employment is determined more by the number of graduates than by staff that is actually needed. For example, in Kuwait, there is a sense of citizens feeling entitled to high-paying bureaucratic jobs, but a lesser regard for what these employees’ tasks would consist of [8].

While the United States relies mostly on the private sector for economic development and high-paying jobs, in many Gulf nations, the private sector is reserved for lower-level and less secure jobs, with a high immigrant presence. Generally lucrative public sector jobs are taken by citizens with connections [9]. The public sector is oversaturated (less than ¼ job growth in the Gulf is in the public sector), but it continues to attract youth due to the pay, vacation time, regular salary increases, cost-of-living adjustments, holidays, and shorter workdays. Workers regularly retire with full benefits after 20 years, meaning it is not uncommon to retire in their 40s [9]. Youth heavily rely on their families to navigate the job market. However, these family members likely never had to navigate the private sector, and place pressure on their children to get a public-sector job. In many cases, negative stereotypes are associated with natives who work in the private sector [9]. Holding a public sector job is also important in the marriage market, and is how men can prove how financially stable they are to the families of potential spouses. Additionally, the public sector is seen as a far more appropriate place for native-born women to work rather than in the private sector. 

In response to an oversaturated public sector, government officials have tried to incentivize growth in the private sector. In 1994, Oman enacted a sector-specific quota for private employers for hiring nationals and a 7% wage tax on foreign workers [9]. Similarly, in 1995 Bahrain required new businesses to demonstrate that at least 10% of their employees were Bahraini. Additionally, these firms had to increase their number of Bahraini employees by 5% each year [9]. As promising as the regulations may seem, quotas, at-large, are far from being achieved. While the public sector still appeals to the youth, private firms worry about the possibility of their young workers leaving for a “superior” public sector job, making them reluctant to invest in training. In extreme cases, private companies  have ghost workers that they “hire” and pay without the expectation that they will have to do anything as a way to avoid training and development costs [9]. 

More recently, the Gulf tried a series of different approaches to increase youth employment. In 2006, Oman began eliminating the kafala system, which reduced segmentation in the labor market and increased national and foreign-born wages [9]. In 2011, Saudi authorities implemented the Nitaqat System. This system applied different quotas based on industry and company size, with highly committed companies being economically rewarded, and low nationalization companies being penalized. Bahrain implemented the most effective system in the Gulf [9]. It eliminated wage expectation and skill gaps between foreign-workers and Bahrainis which made the hiring of Bahrainis a rational business decision, eliminated quotas, deregulated hiring and firing procedures, increased working conditions, and allowed union membership. However, despite positive effects, some were still unhappy. Some Bahraini nationals were upset about the new unemployment insurance tax, and saw it as an income tax. Nonetheless, the Gulf continues to seek new and innovative strategies to better accommodate young workers in the private sector, though significant social and economic factors limit the effectiveness of some of these strategies. 

Another reason for the disposable treatment of guest workers is the idea that their presence is not permanent. While Americans do not necessarily feel entitled to oil in Alaskan reserves, this is not the case with nations like Kuwait. Gulf residents feel a sense of ownership over the nation’s natural resources. In the “Basic Foundations of the Kuwaiti Society,” Article 21 states, “all of the natural wealth and resources are the property of the state…[t]he state shall preserve and properly exploit these resources, heedful of its own security and national economy requisites” [10].  Additionally, people simply feel entitled to the resources because they are in their country and provide strong feelings of autochthony.  [10]. This has created a mentality of a static citizenry where foreigners have almost no path to citizenship, as citizens believe the social services, utilities, and education they enjoy from their resources would no longer be accessible. Additionally, the Kuwait Investment Authority claims its mission is to “achieve a long-term investment return on the financial reserves entrusted by the State of Kuwait, providing an alternative to oil reserves, which would enable Kuwait’s future generations to face the uncertainties ahead with greater confidence.” This intergenerational savings platform transfers 15% of oil revenues to it, building the idea that oil is an economic security blanket to generations of Kuwaiti families. [10]. As a result of these factors, many citizens feel they are shareholders of the nation’s oil. 

International outcry may be one way to see changes in the status quo with the kafala system. For example, as a method of protest, millennials and generation Z are more likely to boycott a business if it goes against their principles. If the gulf nations face sanctions, or other financial consequences for the abuse of migrant workers, then the status quo would no longer benefit them financially. The hope is that by enacting a ban on the entry of domestic workers other sending governments will create a coalition to express  how their continuation of providing cheap labor will come at a price –better conditions for workers. However, ultimately, given the dire economic state of these nations and their reliance on receiving nations for remittances, these countries are not really capable of withholding a long-term ban, or of making demands. 

Saudi Arabia is one of the United States’ closest allies in the Middle East. Saudi Arabia is one of the world’s biggest arms importers, and despite concerns about what Saudi Arabia is doing with these resources, the United States and United Kingdom continue to supply Saudi Arabia the majority of their arms [4]. In return, Saudi Arabia provides 10% of the United States’ oil imports [12]. This is in spite of Saudi Arabia’s consistent abuse of guest workers, imprisonment of feminist activists, military intervention to promote dictatorships across the Middle East, and contribution to civilian attacks and extreme famine in Yemen. And yet, the United States has rarely spoken out against them. An even better alternative to a coalition of “sending countries” creating a list of commands would be the demands of crucial relationships Saudi Arabia holds dear in the West. Perhaps economic sanctions and the limiting of firearm trades or pursuing renewable energy alternatives would create adequate pressure to create lasting change in the kafala system. 


References

[1] https://www.aljazeera.com/news/2021/3/14/saudi-arabias-long-awaited-kafala-reform-goes-into-effect

[2] https://news.abs-cbn.com/overseas/12/30/20/kuwaiti-woman-sentenced-to-death-for-torturing-killing-pinay-maid

[3] https://www.thedailystar.net/country/news/473-women-migrant-workers-dead-abroad-2016-175-saudi-arabia-alone-1987181

[4] https://www.brookings.edu/blog/order-from-chaos/2021/02/04/its-time-to-stop-us-arms-sales-to-saudi-arabia/

[5] Longva, Anh Nga. “Keeping Migrant Workers in Check: The Kafala System in the Gulf.” Middle East Report, no. 211, 1999, p. 20., doi:10.2307/3013330.

[6] https://www.compareremit.com/money-transfer-guide/top-five-countries-that-benefit-most-from-remittance/

[7] Cammett, M., & Diwan, I. (2017). The Political Economy of Development in the Middle East. The Middle East, Ellen Lust, Editor, University of Gothenburg, 106–159. 

[8] Herb, M. (2014). Chapter 1: Labor Markets and Class Politics. The Wages of Oil: Parliaments and Economic Development in Kuwait and the Uae, 18–44. 

[9] Dyer, P., & Kherfi, S. (2016). Gulf Youth and the Labor Market. Young Generation Awakening: Economics, Society, and Policy on the Eve of the Arab Spring, 88-109.

[10] Beaugrand, C. (n.d.). Oil metonym, citizens’ entitlement, and rent maximizing: Reflections of the specificity of Kuwait. In The Politics of Rentier States in the Gulf (33rd ed., pp. 56-59). The Project on Middle East Political Science.

[11] https://repository.library.georgetown.edu/bitstream/handle/10822/558543/CIRSSummaryReport2MigrantLaborintheGulf2011.pdf?sequence=5#_ga=1.53810208.927720351.1441100058

[12] https://www.americangeosciences.org/critical-issues/faq/how-much-oil-does-us-export-and-import

Photo credit: https://www.middleeasteye.net/news/anger-over-suicide-23-year-old-domestic-worker-lebanon