Labor Law in Saudi Arabia

The Labor Law in the Kingdom of Saudi Arabia is a set of regulations and procedures that govern the labor market in the Kingdom. The law was issued by a Royal Decree on September 27, 2005, and it has undergone several amendments, the most recent being in 2024.

Since the issuance of the Labor Law in 2005, and until 2024, six Royal Decrees and Council of Ministers' decisions have been issued to amend the law, in the years: 2013, 2015, 2018, 2019, 2020, and 2024. These changes included numerous provisions of the system, and some of these provisions have been amended multiple times.

The latest amendments, issued on August 6, 2024, included the modification of thirty-eight provisions, the deletion of seven provisions, and the addition of two new provisions to the Labor Law. The amendments support the direction toward developing existing regulations and bylaws, contributing to the support of the market, productive, and service sectors, and providing an appropriate legislative environment. They also support small and medium-sized enterprises with the aim of creating more job opportunities for citizens and achieving sustainable development goals in line with the Labor Market Strategy and the objectives of Saudi Vision 2030.

The amendments took into consideration the interests of all parties involved in the contractual relationship. They included expansions in the parts related to leaves and contracts, the addition of definitions for the terms "resignation" and "delegation," as well as the introduction of an article outlining the procedures for resignation and modifications to the grievance procedures for workers. Penalties were also introduced for engaging in employment activities without a license from the ministry. The new amendments stipulated that employers must provide a policy for training and development to enhance employees' skills and improve their performance. Additionally, several changes were made to the part on marine employment.

The amendments contribute to creating an attractive labor market in line with the best global practices, in addition to generating more job opportunities for citizens and workers. This, in turn, helps reduce employee turnover and minimize labor disputes and conflicts. The amendments help enhance opportunities for dedicating time to development and innovation while protecting the rights of both parties in the contractual relation and developing human resources. Additionally, the amendments promote foreign investment and attract the skilled professionals needed by the labor market.

The Labor Law in the Kingdom consists of sixteen parts, containing 245 articles, which include the following: definitions and general provisions, organization of recruitment, employment of non-Saudis, training and qualification, work relations, working conditions and circumstances, part-time work, protection against occupational hazards, major industrial accidents and work injuries, and health and social services, employment of women, employment of minors, marine employment contract, working in mines and quarries, work inspection, commissions for settlement of labor disputes, punishments, and concluding provisions.

The Labor Law in the Kingdom considers work a right for citizens, and non-Saudis are not permitted to engage in work unless the conditions stipulated in this law are met. It also considers all citizens equal in the right to work without discrimination on the basis of gender, disability, age, or any other form of discrimination, whether during their performance of work, at the time of employment, or at the time of advertising

The following are exempted from the implementation of the provisions of the Labor Law: The employer's family members, namely, the spouse and the ascendants and descendants who constitute the only workers of the firm, players and coaches of sports clubs and federations., domestic workers and the like, agricultural workers, private herdsmen, and the like, and non-Saudi workers entering the Kingdom to perform a specific task for a period not exceeding two months.

The Labor Law in the Kingdom outlines the duties of employment units established by the Ministry of Human Resources and Social Development, which include: assisting workers in finding suitable jobs, aiding employers in recruiting suitable workers, gathering necessary information on the labor market and its developments and analyzing such information to make it available to various public and private organizations concerned with economic and social planning affairs, registering job seekers, obtaining data on vacant jobs from employers, referring workers’ applications to suitable vacant jobs, and providing advice and assistance to job seekers with respect to vocational qualification and training or the required retraining to fill vacancies.

The Labor Law in the Kingdom prohibits recruitment from abroad for the purpose of work without the approval of the ministry. It also prohibits non-Saudis from engaging in any work or being allowed to engage in any work except after obtaining a work permit from the Ministry of Human Resources and Social Development.

The Labor Law in the Kingdom requires the employer to prepare his Saudi workers and enhance their technical, administrative, vocational, and other skills.

The Labor Law considers the employment contract as a contract concluded between an employer and a worker, whereby the latter undertakes to work under the management or supervision of the former for a wage. The law grants the Council of Ministers the authority to set a minimum wage. The law prohibits employing a worker for more than eight hours per day or more than forty-eight hours per week. During the month of Ramadan, the actual working hours for Muslims are reduced to a maximum of six hours a day or thirty-six hours a week.

The Labor Law in the Kingdom grants working women the right to a fully paid maternity leave for a period of twelve weeks, six of which must be taken after delivery. The remaining six weeks are to be divided at the female worker’s discretion. Such period may start four weeks prior to the expected date of delivery. The expected date of delivery is determined pursuant to a medical report certified by a health authority. In the event that the remaining leave is less than six weeks due to a delayed delivery beyond the expected date, the remaining period is counted as unpaid leave. In all cases, a working woman is entitled to extend the leave by an additional month as unpaid leave.

In the event of giving birth to a sick child or a child with special needs whose health condition requires a constant companion, a female worker is entitled to a one-month leave with full pay starting at the end of the maternity leave, and she is entitled to extend the leave for an additional month as unpaid leave. Part fifteen of the Labor Law addresses the penalties for violations of the law.