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The Kuwaiti government announced it will be scrapping the sponsorship system for foreign workers in February 2011, becoming the second GCC country to end what has been described as “modern slavery." Kuwaiti Minister of Social Affairs and Labour Mohammed al-Afasi said that the system, called kafeel, will be abolished to give way to the creation of a public authority for the recruitment of workers.

 

The kafeel system requires Kuwaiti employers to sponsor foreign workers, making the latter vulnerable to abuse. Foreign workers can only look for new jobs without prior approval from their sponsors after three years of service.

 

In 2009, Bahrain abolished the scheme which it likened to “modern-day slavery." International human rights groups have also criticized the policy.

 

The proposed bill further requires a nationally implemented minimum wage for certain jobs, especially for the lower-paid categories.

 

September 29, 2010

 

 

Analysis and Forecast: Decreasing Risk


 

The Kuwaiti announcement that the government is now actively working to reform the labour laws is a welcome move. There have been discussions of such reforms going on for months, but this is the first time the government has committed to a date.

 

Current labour laws in the GCC have generally been criticized by international rights groups as they subject foreign workers, who form the majority of GCC populations (except in Saudi Arabia) to abuse.

 

When Kuwait introduces the new law, it will likely to make the country more attractive both to foreign talent as well as improve the country’s image, contributing positively to the government’s attempts to attract foreign investment and diversify the economy. The new law will also lead to more better skilled workers to move to Kuwait from other GCC states, as Kuwait has a reputation of having the most severe labour laws in the region. So far, such workers have preferred other GCC states.