In a significant move to foster a more attractive and stable work environment, the Saudi Cabinet has approved a comprehensive series of amendments to the Labor Law. These changes aim to align with the goals of Saudi Vision 2030, support sustainable development, and enhance job stability, while protecting the rights of all parties in contractual relationships. The result of an extensive study and consultation process, the amendments introduce key changes to 38 articles, remove 7, and add 2 new ones, refining existing regulations and bolstering the market and productive sectors.

Key Amendments to the Labor Law Provisions

Adding Definitions for Terms

Added definitions for ” Attribution and Resignation” and added a clause clarifying resignation procedures.

Clarification of Contract Renewal

A mechanism for determining the contract period and renewing it for non-Saudi workers in case the contract does not specify its duration.

Addition to Employer Obligations

Employers are prohibited from taking any action that may result in the suspension or cancellation of equal application of usage and professional treatment.

Rights for Trainees and Apprentices

Adding the rights and obligations of both the trainee and the employer in a training contract.

Requirement for Specifying Probation Period

Determining the probationary period in the employment contract not to exceed a total of 180 days.

Addition of Termination Conditions Related to Bankruptcy

Added a condition for termination of the employment contract associated with bankruptcy procedures, ending upon the issuance of a decision or judgment by the competent court.

Modification of Notice Period for Termination

Amended the notice period for terminating an indefinite contract to be 30 days if the termination is by the worker, or 60 days if the termination is by the employer.

Compensatory Leave

Employers can offer compensatory paid leave days instead of overtime pay, with the worker’s consent

Special Leave Entitlements

Workers are entitled to full-pay leaves for personal and family events, 5 days for marriage, 5 days for death of spouse, ascendant, or descendant, 3 days for death of brother or sister, days for birth of a child (within 7 days of birth) Leaves are calculated from the date of the incident. Employers may request supporting documents for verification purpose

Enhanced Maternity Leave Benefit

Increased maternity leave for women to twelve weeks.

Option to Agree on Additional Leave

The possibility for an agreement to obtain unpaid leave for a period agreed upon by the employer, not counted towards the worker’s total working hours.

https://portal.uqn.gov.sa/details?p=25379

List of violations of supporting the Human Resources Development Fund “HRDF”

The Human Resources Development Fund (HRDF) has issued a new regulation that includes a set of violations that require penalties, in a step that comes as part of the Fund’s efforts to ensure the sustainability of its programs to achieve the goals of the Kingdom’s Vision 2030. This regulation sends a clear message to beneficiaries of support programs that there are strict control mechanisms in place to ensure that government support is invested in the right place and that the most benefits are made of it.

https://www.uqn.gov.sa/details?p=25399

Investment Law

The Investment Law was redesigned as an integrated system to replace the foreign investment Law issued by Royal Decree No. (M/1) dated 5/1/1421H, in order to align with the Kingdom’s Vision 2030 and the targets of the National Investment Strategy, as well as best international practices, in addition to taking into account the established principles and policies of investment in the Kingdom approved under the Directive No. (16917) dated 27/3/1440H, in order to increase the Gross Domestic Product and achieve economic diversification by supporting the development of investment sectors, increasing the private sector’s contribution to GDP, and preserving the rights of investors.

https://portal.uqn.gov.sa/details?p=25337

System of the Oversight and Anti- Corruption Authority

The new Oversight and Anti-Corruption Authority system aims to protect the rights and interests of citizens by combating corruption that negatively affects public services and the national economy. This system enhances citizens’ confidence in state institutions and ensures a fair and transparent work environment for all.

https://www.uqn.gov.sa/details?p=25318

Governance Guidelines for Public Entities

A new step towards enhancing transparency and accountability!The Governance Manual for Public Entities was recently approved, which will establish the principles of good governance in all state institutions. This achievement represents a qualitative leap in the management of public affairs, as it will contribute to raising the efficiency of performance and achieving strategic goals.

https://www.uqn.gov.sa/details?p=25324

The Council of Ministers: Extending the period of the state’s bearing the financial compensation prescribed for expatriate workers for industrial establishments to 11/7/1447 AH

Good news for industrial plant owners! The Council of Ministers approved the extension of the period for the state to bear financial compensation for expatriate workers. This extension will save industrial companies significant financial burdens, enabling them to invest in developing their operations and increasing their productivity.

https://portal.uqn.gov.sa/details?p=25344

Adoption of (177) Saudi Standard and Adoption of (430) Standard Specification

In an important step to enhance the quality of products and services in the Kingdom, the Saudi Organization for Standardization and Metrology announced the adoption of 177 new specifications and the adoption of 430 others. These new specifications cover a wide range of sectors, including industry, agriculture, and services. Through this measure, SASO seeks to achieve compliance with international standards and enhance the competitiveness of Saudi products in global markets.

https://www.uqn.gov.sa/details?p=25345

Integrated Customs Tariff

In a step towards unifying customs procedures and facilitating trade, the competent authorities announced the launch of a new integrated customs tariff system. This comprehensive system is aimed at simplifying customs operations and standardizing customs prices on various goods and products. For more information about this important update and its impact on your business.

https://www.uqn.gov.sa/details?p=25353

Technical Regulation for Communications and Information Technology Equipment

The Saudi Standards, Metrology and Quality Organization (SASO) has issued a new technical regulation for communications and information technology products, in line with the Kingdom’s commitments to the World Trade Organization agreements, and in order to ensure the quality and safety of products traded in the Saudi market, and to standardize conformity assessment procedures.

https://www.uqn.gov.sa/details?p=25398

• This new regulations are summarized for guidance, for more information please visit the provided links, and for clarifications and implementation contact The Vision Advocates.