Saudis to concentrate hiring of labourers

Riyadh hopes replacing hundreds of small firms with a few large ones will improve services for both employers and employees.

RIYADH // The Saudi government is drafting proposals to change how unskilled foreign workers are recruited and trained for work in the kingdom, but has no plans to drop the country's decades-old sponsorship system, senior officials say. The proposals - still being finalised by the ministry of labour - call for a new system of privately run recruiting companies to replace what are now hundreds of smaller, less-regulated agencies, Abdul Wahid K al Humaid, the deputy labour minister, said in an interview. The new companies will have to meet strict standards set by the ministry, and it is hoped that, because of their size, they will deliver improved services to both employers and employees, he said. Instead of "a tiny office in a tiny street", there will be "companies with huge capital" that are "very well organised with branches all over the kingdom and in the sending countries", Mr al Humaid said. Employers, he added, will continue to be the official "sponsor" of their employees once the worker is hired. The specific categories of unskilled labour to be covered by the new system have not yet been disclosed, so it is unclear how sweeping the new system will be. It appears that individual employers will still be able to recruit professional, highly skilled workers directly from their home countries, or from existing recruiting agencies, although such agencies will eventually be phased out. The labour minister, Ghazi al Gosaiby, recently told local reporters the government "has no intention for now of modifying the work system in the kingdom as is the case in Bahrain", which this month became the first Gulf state to scrap the so-called "kafala" system for foreign workers. Comparing it to "the system of slavery", the Bahraini labour minister, Majeed al Alawi, announced that starting on Aug 1 his government instead would issue two-year work permits, and that workers would no longer have to be sponsored by a Bahraini citizen or get their employers' permission to change jobs. Meanwhile, in a separate development, Saudi Arabia's Shura Council has almost completed a review of new regulations to govern the relationship between domestic workers and their employers, according to Fahhad bin Muetad al Hamad, chairman of the council's human resources development committee. The regulations, proposed by the labour ministry, will cover such things as working hours, days off and salary payment deadlines for maids, drivers and gardeners. Of the kingdom's eight million foreign workers, 1.2 million are domestic workers, Mr al Hamad said. Saudi Arabia has come under intense international criticism from human rights groups for its treatment of household staffers, especially maids. At the same time, Saudis often complain that after paying to bring someone from a foreign country to work here, the employee runs away to seek a better-paying job in the underground labour market. The new rules are aimed at ensuring "that each side knows its rights and obligations", Mr al Hamad said. The council debate on the proposed rules "was one of the hottest discussions" he had seen in his five years in the state-appointed advisory body, he said. He expects the regulations, which will be translated into foreign languages, to be implemented within a year. Both free-market economists and human rights groups have pressed for an end to Saudi Arabia's kafala system, which the private consulting firm McKinsey and Co once likened to "a system of indentured employment". In a 2007 report on labour markets in Gulf states, the firm said that by guaranteeing cheap labour, the system depresses wages for everyone, thus discouraging nationals from entering the workplace. A report by the Riyadh Economic Forum in Dec 2007 said foreigners account for 76 per cent of the country's total workforce. One Riyadh businessman, Turki F al Rasheed, said the business community generally likes the current system because it assures them of cheap labour that is totally at their mercy. Migrant workers must surrender their passports to their employers, whose permission is needed to change jobs or leave the country. "Why would I hire a Saudi when I can hire a Bangladeshi for 500 riyals [Dh490] a month and he'll work from 8 am til 11 o'clock at night?" Mr al Rasheed asked. Saying that the proposal for new recruiting companies "will not work", he added he favours abolishing the kafala system and having the ministry of labour issue work visas to foreign workers and set minimum wages. "All the businessmen want to throw hot tea in my face when I talk like this," he joked, adding in a serious tone: "We cannot go on like this; we have millions of Saudis unemployed." Human rights activists want the system dumped because it facilitates exploitation of migrant workers. In an 80-page report on the sponsorship system last year, the National Society for Human Rights, a Saudi non-governmental organisation, assailed it for "practices that go against the teachings of Islamic Sharia". Hussein al Shareef, the society's representative in Mecca said in an interview that details of the government's proposed changes are not clear yet. But, he added, "we are afraid it just transfers sponsorship from individuals to companies". The deputy labour minister, Mr al Humaid, said the new recruiting companies - whose number has not yet been determined - would provide "two types of services". First, they would supply expatriate labour to businesses "in a much, much more organised fashion" than now because they will have computer databases with workers' names and nationalities and "training centres" in the countries where labourers are recruited. Secondly, "these companies will have their own employees to be hired out temporarily". In those cases, the companies will be the employees' sponsor. Although the new recruiting companies appear to be an attempt to curtail employer abuses by inserting a third party that will be required to observe certain standards, one member of the Shura Council, Osama al Kurdi, said he was sceptical of the government's idea. "I don't see how larger companies will do any better than these small companies," he said, adding that they may even "create a monopoly". "The only way to go is to completely revise the sponsorship law." Attempts to get comments from the chambers of commerce in Jeddah and Riyadh were unsuccessful; officials at those organisations did not return phone calls or reply to e-mails. [e-mail]