The Saudi system of sponsoring employment has long been under fire from foreign countries and has even prompted a Hollywood film producer to make a movie highlighting its negative aspects.
The foreign criticism of the system is based on the charge that it limits an individual’s basic freedom to work. The iqama (residence permit) and the labor regulations allow an expatriate only to undertake an officially specified job.
The system has allowed a flourishing illegal trade in employment visas. Unscrupulous sponsors apply for permits to recruit foreign workers in excess of their requirements. These sponsors allow the extra permit holders to work illegally for other people. In return the workers share their income with their respective sponsors.
In these illegal arrangements, sponsors do not pay for iqama renewal, exit-re-entry visa or any other obligation that the law requires of the sponsor. His role in this situation degenerates to simply collecting his cut of the profits.
The opportunity to make easy money tempts him to apply for increasing numbers of work visas for the cleaning or maintenance companies or other businesses registered in his name.
If he needs only 100 workers in his company he applies for 150 foreign workers’ visas. The sponsor then allows the excess 50 expatriate workers to look for jobs illegally elsewhere. As the sponsor evades expensive legal responsibilities toward these workers, the system has emerged to be one of the most profitable, but illegal, investment areas.
It is high time such practices were stopped. Amendments must be made to the system, particularly in the light of the ongoing efforts to free up the economy to attract more foreign investors. The changes are also required to make the system compatible with the demands of the World Trade Organization.
12 August 2002
