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Saudi Arabia
 


Source and scope of regulations - 2017    

References
NOTE: This information has changed since the previous period covered.
  • Labour Law, Royal Decree No. M/51 as last amended by the Ministerial Resolution No. 50945 adopted on 29 January, 2017
    Date: 29 Jan 2017 (view in NATLEX »)
Scope
Size of enterprises excluded (≤): none
Workers' categories excluded: agricultural workers; domestic workers; seafarers; sportsmen; employer's family members
Remarks:
  • Art. 7 LL: The following shall be exempted from the implementation of the provisions of this Law:
    (1) The employer's family members, namely, the spouse, the ascendants and descendants who constitute the only workers of the firm.
    (2) Domestic helpers and the like.
    (3) Sea workers working on board of vessels with a load of less than five hundred tons.
    (4) Agricultural workers other than the categories stated in Article (5) of this Law.
    (5) Non-Saudi workers entering the Kingdom to perform a specific task for a period not exceeding two months.
    (6) Players and coaches of sports clubs and federations.


Types of employment contracts - 2017    

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Maximum probationary (trial) period: 180 day(s)

Remarks:
  • Art. 53 LC: probationary period is extended to up to 180 days with the 2015 reform.

Fixed term contract (FTC):
  • FTC regulated: Yes
  • Valid reasons for FTC use: no limitation
    Remarks:
    • Sec. 55 LL
  • Maximum number of successive FTCs: 2
    Remarks:
    • Art. 55(2) LL.
  • Maximum cumulative duration of successive FTCs: 36 month(s)
    Remarks:
    • Art. 55 (2) LL: If the original contract term and the renewal period amount to three years and the two parties continues to implement it, the contract shall become an indefinite term contract.
      See art. 37 LL on foreign workers.

Substantive requirements for dismissals (justified and prohibited grounds) - 2017    

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Obligation to provide reasons to the employee: Yes
Remarks:
  • Sec. 75 LL: the contract can be terminated by either party for a valid reason to be specified in a written notice.


Valid grounds (justified dismissal): any fair reasons
Remarks:
  • Sec. 75 LL: "a contract of an indefinite term can be terminated by either party for a valid reason to be specified in a written notice".
    Sec. 80 LL: provides for a list of behaviours entailing dismissal without notice (dismissal for serious misconduct).


Prohibited grounds: maternity leave
Remarks:
  • No statutory provision on non-discrimination in the LL.
    Maternity leave: sec. 155 LL
    Note: dismissal during pregnancy is not prohibited. What is only prohibited is dismissal during illness resulting from pregnancy provided the absence of the worker does not exceed 180 days.


Workers enjoying special protection: pregnant women and/or women on maternity leave
Remarks:
  • Limited protection. No prohibition of dismissal of pregnant women as such: the prohibition only covers maternity leave (sec. 155 LL: 10 weeks period) and period of illness resulting from pregnancy or delivery provided it does not exceed 180 days (sec. 156 LL).


Procedural requirements for individual dismissals - 2017    

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Notification to the worker to be dismissed: written

Remarks:
  • Art. 75 LL.

Notice period:
Remarks:
  • Art 75 LL: the notice period shall be at least 60 days for monthly paid workers and 30 days for the others.
    • tenure ≥ 6 months
      • monthly paid workers - 1 month(s).
      • non-monthly paid workers - 15 day(s).
    • tenure ≥ 9 months
      • monthly paid workers - 1 month(s).
      • non-monthly paid workers - 15 day(s).
    • tenure ≥ 2 years
      • monthly paid workers - 1 month(s).
      • non-monthly paid workers - 15 day(s).
    • tenure ≥ 4 years
      • monthly paid workers - 1 month(s).
      • non-monthly paid workers - 15 day(s).
    • tenure ≥ 5 years
      • monthly paid workers - 1 month(s).
      • non-monthly paid workers - 15 day(s).
    • tenure ≥ 10 years
      • monthly paid workers - 1 month(s).
      • non-monthly paid workers - 15 day(s).
    • tenure ≥ 20 years
      • monthly paid workers - 1 month(s).
      • non-monthly paid workers - 15 day(s).

    Pay in lieu of notice: Yes

    Remarks:
    • Art. 76 LL.

    Notification to the public administration: No

    Notification to workers' representatives: No

    Approval by public administration or judicial bodies: No

    Approval by workers' representatives: No

    Procedural requirements for collective dismissals for economic reasons (redundancy, retrenchment) - 2017    

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    Definition of collective dismissal (number of employees concerned):
    No legal definition.

    Prior consultations with trade unions (workers' representatives): No

    Notification to the public administration: No

    Notification to workers' representatives: No

    Approval by public administration or judicial bodies: No

    Approval by workers' representatives: No

    Priority rules for collective dismissals (social considerations, age, job tenure): No

    Employer's obligation to consider alternatives to dismissal (transfers, retraining...): No

    Priority rules for re-employment: No

    Notes / Remarks
    No legal provisions on collective dismissals.

    Severance pay and redundancy payment - 2017    

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    Severance pay:
    Remarks:
    • The Labour Law provides in art. 84 for an end-of-service award that shall be due at the end of the work relation, no matter the reason of termination of employment (retirement, end of the fixed-term contract, "force majeure", resignation). Such award shall amount to half-month wages for each of the first five years of service and one-month wages for the following years. It is however reduced in case of resignation.
    • tenure ≥ 6 months: 0.25 month(s)
    • tenure ≥ 9 months: 0.33 month(s)
    • tenure ≥ 1 year: 0.5 month(s)
    • tenure ≥ 2 years: 1 month(s)
    • tenure ≥ 4 years: 2 month(s)
    • tenure ≥ 5 years: 2.5 month(s)
    • tenure ≥ 10 years: 7.5 month(s)
    • tenure ≥ 20 years: 17.5 month(s)
    Redundancy payment:
    Remarks:
    • No specific redundancy payment. However, the Labour Law provides in art. 84 for an end-of-service award that shall be due at the end of the work relation, no matter the reason of termination of employment (retirement, end of the fixed-term contract, "force majeure", resignation). Such award shall amount to half-month wages for each of the first five years of service and one-month wages for the following years. It is however reduced in case of resignation.
    • tenure ≥ 6 months: 0.25 month(s)
    • tenure ≥ 9 months: 0.33 month(s)
    • tenure ≥ 1 year: 0.5 month(s)
    • tenure ≥ 2 years: 1 month(s)
    • tenure ≥ 4 years: 2 month(s)
    • tenure ≥ 5 years: 2.5 month(s)
    • tenure ≥ 10 years: 7.5 month(s)
    • tenure ≥ 20 years: 17.5 month(s)

    Avenues for redress (penalties, remedies) and litigation procedure for individual complaints - 2017    

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    Compensation for unfair dismissal - free determination by court: Yes

    Remarks:
    • Art. 77 LL: "If the contract is terminated for an invalid reason, the party who is harmed by such termination shall be entitled to indemnity to be assessed by the Commission for the Settlement of Labor Disputes, taking into account the termination circumstances and actual and potential material and moral damages sustained".

    Reinstatement available: Yes

    Remarks:
    • Art. 78 LL.

    Preliminary mandatory conciliation: Yes

    Remarks:
    • Prior to referrimg any dispute to the Commission (acting as a Labour Court), it shall be brought to the labour office which shall attempt to settle it amicably (art 220 LL).
      No information available as to any mandatory conciliation before the Commission for the Settlement of Labour Disputes.

    Competent court(s) / tribunal(s): labour court

    Remarks:
    • Art. 77 LL & art. 210 to 228 LL on labour disputes settlement.
      The competent body is the Commission for the Settlement of Labour Disputes which is part of the judiciary.
      The Commission can only be seized after the amicable settlement before the labor office has failed.

    Existing arbitration: Yes

    Remarks:
    • Art. 224 LL: The parties can agree to settle the dispute through arbitration.

    Source of additional information - 2017    

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