Qatar has become the first Arab country to officially "abolish" the kafala (sponsorship) system that governs foreign laborers.

The new labor law, which comes into effect as of Tuesday, "abolishes the kafala (sponsorship) system and guarantees greater flexibility, freedom and protection to Qatar’s more than 2.1 million salaried workforce," according to the Qatar News Agency

Different forms of kafala govern foreign workers' in the United Arab Emirates, Oman, Bahrain, Kuwait, Saudi Arabia, Jordan, Iraq and Lebanon. 

The system is highly criticized by activists and human rights group for exploiting workers and denying them basic rights such as the ability to travel or change jobs. Employers often confiscate workers passports, although this is technically illegal in most countries.

Here's a closer look at what Qatar's labor reforms mean for foreign workers in the emirate, as well as what kafala means for workers in other Arab countries.

1. Some things have improved for foreign workers in Qatar

All work contracts for foreigners must now be approved by Qatar's Ministry of Labor before visas are issued. Previously, many foreigner workers were entering the country only to discover that their contracts had been changed by their employer without their consent. Wages and benefits may have been lowered, for instance.

Employers who confiscate workers' passports also now face a steep fine of 25,000 Qatari riyals ($6,865) per worker. This is one of the toughest fines in the region.

Foreign workers with fixed term contracts can also now change employers with less hassle. Those with open-ended contracts must work five years before changing jobs without hassle.

A government committee has been setup to review any concerns by workers, particularly when employers try to block them from leaving the country.

2. Rights groups are skeptical about how much of this system has been "abolished"

Amnesty International has said that while Qatar's changes are a step in the right direction, the new law "barely scratches the surface of labour exploitation."

"This new law may get rid of the word ‘sponsorship’ but it leaves the same basic system intact," James Lynch, Deputy Director for Global Issues at Amnesty International, said in a statement

Lynch also said that it is positive that "Qatar has accepted that its laws were fueling abuse" but cautioned that "inadequate changes will continue to leave workers at the mercy of exploitative bosses."

In response to such criticisms, the government said it remains "committed to the development of a labor system that is fair to both employers and employees alike." 

Minister of Administrative Development, Labour and Social Affairs Dr. Issa bin Saad Al Jafali Al Nuaimi urged the international community against making "any definitive conclusions until there has been time to see the new law in action."

3. Some things haven't changed for foreign workers

Foreign workers must still obtain permits to leave Qatar for any reason. The law states that an automated system has been implemented to facilitate this process.

But officials are saying that workers will still need their employers' permission to leave the country, according to Doha News. Also, while employers are forbidden from holding workers' passports, a loophole allows them to hold the travel documents with written permission from the worker.

Rights groups have said this loophole can easily be exploited by employers, especially when it comes to low-income laborers who may be less educated and less aware of their rights.

While it is now easier for some foreigners to leave and change their jobs, there are caveats as well. 

Workers still need a "no objection certificate" to change jobs. Only workers on fixed-term contracts can change jobs without the certificate after their contract has terminated.

4. Qatar has received international criticism for its treatment of foreign workers

As the host of 2022 FIFA World Cup, the emirate has been at the center of intense international criticism for the poor treatment of workers building stadiums and other facilities for the event. Human rights groups have gone so far as to call for FIFA to backtrack on its decision.

But Qatari leaders have responded by promising to address the concerns, and pointing to human rights abuses by other world cup hosts. Several leaders have said anti-Muslim and anti-Arab bias have heightened the level of criticism against the country.

Former Qatari Prime Minister, Sheikh Hamad bin Jassim al-Thani argued that the emirate is facing much harsher criticism than Russia, which will host the event in 2018.

"Is it because it's an Arab, Islamic, small country? That's what the people in the region feel," he said in June of last year, according to The Independent.

5. Kafala is a problem throughout the Arab world

While several Arab countries, including the United Arab Emirates, have made some efforts to address kafala like Qatar, significant abuses of foreign workers continue throughout the region.

The system is so bad for some workers that rights groups have called it "modern-day slavery." 

Migrant Rights estimates that more than 600,000 people are working in "forced labor" situations throughout the Middle East. Many other workers are paid very low wages for working long hours, sometimes without any days off. 

Although accurate statistics are hard to come by, rights groups estimate that suicide rates and work-related deaths are extra high among foreign workers in the region.