When I first heard about the Kafala system over a decade ago, I admit I struggled to grasp how worker sponsorship could feel so different from the employment models I knew. But since then—and after helping Chinese companies expand into the Gulf Cooperation Council (GCC) region—I’ve seen just how much this system shapes the realities for Chinese HR managers in places like Saudi Arabia, UAE, Qatar, Kuwait, Oman, and Bahrain.
If you’re leading HR for a Chinese business pushing into the GCC, maybe with a surge of engineers, tech support, or back-office teams, the Kafala system will impact nearly every hiring, onboarding, and employee management decision you make. The nuances still catch me off guard sometimes, even after years of practice.
The Kafala system isn’t just paperwork. It affects work lives, cross-border growth, and company reputation.
So here’s my practical take—a step-by-step breakdown tailored for Chinese HR teams—on what the Kafala system is, how it changes your job, what’s been reformed recently, the risks, and some hands-on advice from what I’ve seen on the ground. I’ll bring EWS Limited’s cross-border expertise into the equation too, since our solutions are designed exactly for these situations.
The Kafala system, which directly translates as ‘sponsorship’, forms the backbone of how foreign labor works in much of the GCC. In Kafala countries, a migrant worker’s immigration status is legally tied to a local sponsor—usually the employer—who takes charge of their visa, entry, exit, and many key work permissions. In practical terms, you can’t just hire, fire, relocate, or transfer your Chinese staff at will. Even moving an employee to another branch might require not only government paperwork but sometimes the explicit permission of their prior or current sponsor.
Kafala isn’t one-size-fits-all: Each GCC nation has its own quirks, reforms, and speed of change. Even in countries like Qatar and Saudi Arabia, where some key reforms have been introduced, the underlying employer control and sponsorship link remain very different from labor law models in China or Europe.
For Chinese HR, this means:
“Kafala decisions can be strategic, not just administrative.”
This is where, in my opinion, the experience and local expertise of teams such as ours at EWS Limited become almost indispensable, especially if you seek frictionless employee transfers and peace of mind on compliance.
Let me break it down as simply as I can. Under the Kafala system, legal responsibility for foreign employees (including nearly all Chinese expatriates) passes to the employer or sponsor (‘Kafeel’). This system determines:
In early days, many of my clients from China expected something closer to the European blue card or H-1B: get a visa, work with relative freedom, and change jobs if needed. But under Kafala, movement and employment rights are restricted unless the sponsor allows otherwise, or unless recent reforms apply.
Not every GCC nation enforces Kafala in exactly the same way. Here’s how I’ve seen it play out:
If you want detailed local expertise in Kuwait, I’ve recommended Chinese HR teams study the guidelines provided by EWS Limited on Employer of Record Kuwait, because rules shift quickly but local best practice is crucial to avoid compliance risks.
Sometimes, when discussing Kafala, people assume it’s fixed in stone. That’s not true. In fact, reforms through 2020-2022 have greatly changed how sponsorship works in some countries—and Chinese HR needs to stay up to date, because the compliance risks can shift with little warning.
As recently as 2020, Qatar scrapped the NOC, enabling most expatriate workers to change jobs freely. The ILO’s note confirmed that over 100,000 workers have already switched jobs under the new rules. However, HR should watch what’s still required: contracts, notification periods, and payroll formalities haven’t disappeared.
A BBC News report about Qatar’s labor policy change shows authorities responding to international pressure, but practical realities for HR teams still include language barriers, procedural bottlenecks, and communication with authorities.
Saudi Arabia also relaxed parts of the Kafala system from March 2021, letting many workers move jobs and travel for emergencies without explicit employer exit permission. Analysis from the Middle East Institute notes that more than 10 million foreign workers in Saudi will be affected in phases, but only certain job categories and sectors apply, so careful legal review remains necessary.
One recent client of mine—a telecom infrastructure provider—found out the hard way. The company relied on an outdated process for exit permits, and an engineer missed an urgent family event due to confusion about new rights. Stories like this remind me that “reforms” often don’t mean total freedom, especially for HR managers trying to balance legal safety and employee expectations.
Although Bahrain, Kuwait, and Oman are examining their own sponsorship systems, the Kafala-to-employer link persists. For Chinese HR, these locations can be daunting. That’s why I usually advise cross-checking local regulations directly—EWS Limited puts clear documentation at the center of every Employer of Record solution in Bahrain and elsewhere.
Let me focus on a few practical rules and tips that come up most, especially in IT and engineering sectors where Chinese companies are expanding quickly.
Even with new rules, transferring sponsorship can still mean:
Failing to manage transfer steps just once can risk visa cancellation, fines, or unwanted attention from authorities. Unfortunately, I’ve seen sponsors who overlooked a single step only to find the employee unable to re-enter the country or facing lengthy detention at airports.
While Qatar and Saudi Arabia have relaxed formal “exit permits”, some job types, especially in government-linked or strategic sectors, still need clear permission, according to the BBC. Consider building a travel policy for your Chinese employees’ business and personal trips that acknowledges:
Chinese firms are sometimes surprised by non-payroll legal dues attached to Kafala sponsorship. For example:
This is why multi-currency payroll partners (like those at EWS Limited) become lifelines for many Chinese HR teams. I’ve seen payroll slip-ups snowball into local newspaper scandals, so I urge triple-checking those details.
I’ve felt, on site visits in Riyadh and Doha, how the day-to-day of Kafala shapes everything from personal relationships to worker loyalty. This doesn’t show on spreadsheets, but every HR manager moving Chinese teams into the GCC needs to understand it on a human level.
“Trust is built in small steps when people feel respected—Kafala can challenge that.”
From what I’ve seen, common pain points include:
Strong onboarding, clarity about rules, and access to trusted contacts (including in Mandarin and Arabic) help buffer these issues a lot.
I’ve counseled companies who faced everything from visa rejections to sudden employee absconding. The risks for Chinese HR managers, in my experience, break down like this:
In Oman, for example, our guidance on Employer of Record Oman highlights the danger of small errors—just one invalid work permit can get a company blacklisted locally.
Reflecting on my many consultations, and seeing all the complexity in play, I’d share these practical tips:
Above all, create a culture of early problem-solving: encourage open reporting of issues by staff, even if it’s just a minor misunderstanding. In the GCC, local reputation is gold.
In my years advising Chinese technology and engineering brands launching into the GCC, I’ve learned the Kafala system is not just a bureaucratic hurdle, but a real test of cross-cultural HR skill and corporate patience. There’s no one method that suits every situation, but a few truths hold: local experience matters, documentation saves careers, and proactive communication reduces headaches for everyone involved.
The right HR partner—one that understands every step of GCC sponsorship, payroll, immigration and mobility—will turn compliance from a roadblock into a growth accelerator. This is where EWS Limited brings value to the table: whether it’s providing a single point of contact, handling global payroll, or managing ‘impossible’ transfers of staff between Gulf projects.
To learn how EWS Limited’s solutions for Employer of Record, payroll outsourcing, and global mobility can help Chinese HR teams master the Kafala system and set up for long-term GCC growth, reach out to us. Your expansion into the Gulf doesn’t have to feel complicated or risky—let’s make it a confident next step.
The Kafala system is a legal framework used in many GCC countries where a foreign worker’s visa and legal status are tied to a local sponsor, usually the employer. This means the sponsor controls key permissions like job changes, entry, and exit. Rules vary between Saudi Arabia, Qatar, Bahrain, Kuwait, Oman, and the UAE, but the core mechanism gives the sponsor significant authority over the migrant worker’s employment and residency.
Chinese employees working in the GCC under Kafala may find that their freedoms—such as moving to another job or traveling abroad—are limited by their employer’s decisions. Employers (Chinese or otherwise) effectively “own” the work permit, and without the sponsor’s consent, changing jobs can be difficult. Some employees experience anxiety around job mobility, permissions to travel, or extensions of stay, all of which are under the sponsor’s direct influence.
From my experience, the best ways for Chinese HR to handle Kafala issues include building relationships with local legal experts, documenting every HR and payroll process, and giving clear guidance to workers before and during their assignments. Using services focusing on Employer of Record, payroll outsourcing, and global mobility (such as those at EWS Limited) allows for simplified compliance and quicker response to changing legal realities. Training staff in advance and maintaining open communication with both employees and local authorities reduce confusion and minimize risk.
The risks for companies under Kafala include legal penalties from visa or contract mistakes, reputational harm from unhappy employees or public disputes, business disruption due to staffing delays, and difficulties managing payroll or end-of-service obligations. Even a small oversight—like missing a permit renewal—can result in fines, blacklisting, or project setbacks. These risks are higher when expanding rapidly or when operating without strong local HR partners.
In my view, hiring under the Kafala system is sometimes unavoidable for company expansion into the GCC. With the right planning, compliance support, and trustworthy local partners, Chinese businesses can hire, manage, and retain staff safely—even under Kafala. However, it takes more attention to legal and cultural details than many HR teams expect. Where possible, working with an experienced firm like EWS Limited makes Kafala management much less stressful and can set your company up for sustainable success in the Gulf.
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