Stories of exploitation: New Saudi labour law fails to protect financial rights of many migrant workers

Stories of exploitation: New Saudi labour law fails to protect financial rights of many migrant workers

LONDON - As a new labour law went into effect this week in Saudi Arabia, the kingdom will tout it as a reform that marks it as an enlightened, humane leader. However, what it is not publicising, says a new report from ImpACT International for Human Rights Policies, is that the new law exempts the most vulnerable groups of migrant workers, including men and women recruited by private families to clean their homes, drive them to their destinations and tend their lawns.

“Saudi Arabia is a nation built by modern-day slaves, and this law won’t substantially change that,” says Sudeshna Dey, researcher with ImpACT in India. “The government has honed a system of labourer exploitation so entrenched that it continues to pervade every fiber of society.”

 I came to Saudi Arabia mainly to send [my family] money to cover their expenses. But when I came here, I was surprised that I could not open a bank account without the permission and help of my employer. I currently don't have an account, simply because he does not want to help me open one.

Isher, India worker in Saudi Arabia

The estimated 13 million migrants who work in Saudi Arabia were recruited by agents in India (the largest contributor, at 4 million), Pakistan, Kenya, Bangladesh, Yemen and Ethiopia. Although they sign contracts promising acceptable wages, once they arrive, they are often paid only half of what was promised. Women, for example, are often paid a paltry wage of 1,000 riyals (266 USD) a month or less, making it almost impossible to send much home after they pay their own expenses. Sometimes, women are not paid at all.

Lack of pay is not the only restriction on migrants’ financial rights and freedoms. Under the infamous kafala sponsorship system, which enables blatant human rights violations by giving their employers almost total power, a sponsor request is required before migrants can open a bank account or take out a loan.

Saudi banks classify migrant bank accounts as “high risk,” and thus impose a number of conditions:

  1. Banks require an official request from the employer, including the nature of the migrant’s work, the purpose of the account, the wage paid and the sources of any other income. The migrant’s work permit and passport must also be submitted.
  2. Once the account is opened, the migrant is issued an ATM card only; personal checks and credit card are not allowed.
  3. If migrants want to leave the country permanently, the banks immediately freeze their accounts and require the money to be withdrawn.

In one incident, 33-year-old Isher, told ImpACT: “I have six siblings who live with my parents in India. I came to Saudi Arabia mainly to send them money to cover their expenses. But when I came here, I was surprised that I could not open a bank account without the permission and help of my employer. I currently do not have an account, simply because he does not want to help me open one.”

More such stories are described in the ImpACT report.

The concentration of power in the hands of an employer opens the door to abuse and exploitation—a form of slavery

- Sudeshna Dey, researcher at ImpACT in India

“This concentration of power in the hands of an employer opens the door to abuse and exploitation—a form of slavery,” says Dey. “The International Labour Organisation has issued many reports on wages, rights and working conditions but its recommendations have not been implemented. International human rights organizations, including national and local bodies in Saudi Arabia and the countries that send migrants to the kingdom, must come together to demand an end to a discriminatory and archaic system of governance that allows systemic abuse of migrants.”

All types of foreign workers have a right to fair, timely wages; independent bank accounts; and the ability to borrow money if they have sufficient financial resources. Without these rights, migrants cannot achieve the financial health for which they traveled.

Click here to view the full report


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