Labor Relations | Ministry of Human Resources and Social Development

Section 1 Employment Contract

Article 50:

The employment contract is a contract concluded between an employer and a worker, whereby the latter undertakes to work under the management or supervision of the employer in return for wages.

Article 51:

The employment contract must be written in two copies, with each party retaining one copy. It must be documented in accordance with the relevant regulatory provisions and as specified by the regulations. The contract is considered valid even if it is not written. In this case, the worker alone may prove the contract and the rights arising from it using all means of proof. Either party has the right to request a written contract at any time. As for government employees and public institutions, the decision or appointment order issued by the competent authority shall serve as the contract.

Article 52:

Subject to the provisions of Article (37) of this Law, the Ministry shall establish a standard template for each type of employment contract, which shall essentially include: The employer's name and place of business, the worker's name and nationality, the information necessary to verify their identity, their residential address, the agreed-upon wage, including benefits and allowances, the type and location of work, the date of commencement of employment, the duration of the contract if it is for a fixed term, and the basic rights and obligations of each party.
The employment contract shall be in accordance with the model referred to in paragraph (1) of this article. Both parties to the contract may add other clauses, provided they do not conflict with the provisions of this system, its regulations, and the decisions issued for its implementation.

Article 53:

If the worker is subject to a probationary period, this must be explicitly stated in the employment contract, with the duration clearly specified, provided that the total duration does not exceed one hundred and eighty days in all cases. The regulations shall specify the provisions related to this, including those concerning the leave that does not count toward the duration of the probationary period. Both parties have the right to terminate the contract during this period.

Article 54:

A worker may not be placed under probation for more than one time with the same employer. As an exception to this, the two parties to the contract may agree in writing to subject the worker to another probationary period, provided that it is for a different profession or another type of work, or that at least six months have passed since the end of the worker's previous employment relationship with the same employer. If the contract is terminated during the probationary period, neither party shall be entitled to compensation, nor shall the worker be entitled to an end-of-service award for that period.

Article 55:

A fixed-term employment contract shall terminate upon the expiry of its term. If both parties continue to perform it, the contract shall be considered renewed for an indefinite period. Subject to the provisions of Article (37) of this Law regarding non-Saudis.
If the fixed-term contract includes a condition stipulating its renewal for a similar or a specific period, it shall be renewed for the agreed-upon period. If the contract is renewed three consecutive times, or if the original contract period together with the renewal periods reaches four years, whichever is less, and the parties continue to perform it, the contract shall be converted into an indefinite-term contract.

Article 56:

In all cases where the contract is renewed for a fixed term, the renewal period shall be considered an extension of the original term in determining the worker's rights for which the period of service is taken into account.

Article 57:

If the contract is for the performance of a specific task, it shall terminate upon the completion of the agreed-upon task.

Article 58:

The employer may not transfer the employee from their original place of work to another location that requires a change of residence without the employee’s written consent.
In cases of necessity dictated by unforeseen circumstances, and for a period not exceeding thirty days per year, the employer may assign the worker to perform work in a location different from the one agreed upon without requiring their consent, provided that the employer bears the worker's transportation and accommodation costs during that period.

Article 59:

A worker paid on a monthly basis may not be transferred to the category of daily workers or workers appointed on a weekly, piece-rate, or hourly basis, unless the worker agrees to this in writing, and without prejudice to the rights the worker has acquired during the period they were paid on a monthly basis.

Article 60 :

Without prejudice to the provisions of Article (38) of this Law, a worker may not be assigned work that differs fundamentally from the work agreed upon without their written consent, except in cases of necessity dictated by unforeseen circumstances and for a period not exceeding thirty days per year.

Section 2 Duties and Disciplinary Rules

First: Employers' Duties

Article 61:

In addition to the duties stipulated in this law, regulations, and resolutions issued in implementation thereof, the employer must do the following:

The employer must refrain from exploiting the worker for forced labor, must not withhold the worker's wages or any part thereof without judicial basis, must treat the workers with the due respect, and must refrain from any statement or action that violates their dignity or religion.
The employer must provide workers with the necessary time to exercise their rights as stipulated in this system, without deducting wages for this time. The employer may organize the exercise of this right in a manner that does not disrupt the workflow.
The employer must facilitate all tasks related to the implementation of the provisions of this system for the employees of the relevant authorities.
The employer must refrain from any action that would nullify or weaken the application of equal opportunities or treatment in employment and occupation, whether through exclusion, differentiation, or preference among job applicants or its employees based on race, color, sex, age, disability, marital status, or any other form of discrimination.
The employer must provide suitable housing for his employees, or he may substitute this by providing an appropriate cash allowance along with their salary.
To provide suitable transportation for its workers from their place of residence to the workplace. or he may substitute this by providing an appropriate cash allowance along with their salary.

Article 62:

If a worker presents themselves for work at the designated time, or indicates their readiness to perform their work at that time, and is prevented from working only due to a reason attributable to the employer, they shall be entitled to wages for the period during which they do not perform the work.

Article 63:

The employer, their agent, or any person having authority over the workers shall prevent the entry of any legally prohibited substance into the workplaces. The penalties prescribed in this Law shall be applied to anyone found in possession of or consuming such substances, without prejudice to the Sharia penalties.

Article 64:

Upon the termination of the employment contract, the employer shall be obligated to the following:

To provide the worker, upon their request and free of charge, with a certificate of service stating the date of their commencement of work, the date of termination of their employment relationship, their profession, and the amount of their last wage. The employer may not include anything in the certificate that may harm the worker's reputation or reduce their future employment opportunities.
To return to the worker all certificates or documents they have deposited with the employer.

Second: Duties of Workers

Article 65:

In addition to the duties stipulated in this Law and the regulations and decisions issued for its implementation, the worker shall:

Perform the work in accordance with the principles of the profession and the employer's instructions, provided that such instructions do not violate the contract, the Law, public morals, and their implementation does not pose a danger.
1. Take due care of the machinery, tools, supplies, and raw materials owned by the employer and placed at their disposal or in their custody and return any unused materials to the employer.
2. Maintain good conduct and ethics during work.
3. Provide all necessary assistance and help, without requiring additional pay, in cases of disasters and dangers that threaten the safety of the workplace or the persons working therein.
4. Undergo, at the employer's request, medical examinations before or during employment to verify that they are free from occupational or contagious diseases.
5. Keep confidential the technical, commercial, and industrial secrets of the materials they produce or contribute directly or indirectly to their production, and all professional secrets related to the work or the establishment, the disclosure of which may harm the employer's interests.

Third: Disciplinary Rules

Article 66:

The disciplinary penalties that the employer may impose on the worker are:

Warning
Penalty
Deprivation of or delay in the periodic bonus for a period not exceeding one year, if such bonus is established by the employer.
Postponement of promotion for a period not exceeding one year, if such promotion is established by the employer.
Suspension from work with withholding of wages.
Dismissal from work in the cases stipulated in the Law.

Article 67:

The employer may not impose on the worker a penalty that is not stipulated in this Law or in the internal work regulations.

Article 68:

The penalty may not be aggravated in case of repeated violation if one hundred and eighty days have passed since the date the worker was notified of the imposition of the penalty for the previous violation.

Article 69:

A worker may not be accused of a violation that was discovered more than thirty days prior. A disciplinary penalty may not be imposed more than thirty days after the date of the completion of the investigation into the violation and its establishment against the worker.

Article 70:

A disciplinary penalty may not be imposed on a worker for an act committed outside the workplace, unless it is related to the work, the employer, or their responsible manager. Furthermore, for a single violation, a worker may not be fined an amount exceeding the wage of five days, nor may more than one penalty be imposed for a single violation. Moreover, no more than the equivalent of five days' wages may be deducted from their salary in any one month in settlement of fines imposed, and the period of suspension from work without pay may not exceed five days per month.

Article 71:

A disciplinary penalty may not be imposed on a worker unless they have been notified in writing of the charges against them, interrogated, their defense investigated, and this is documented in a record placed in their personal file. In the case of minor violations for which the penalty imposed on the perpetrator does not exceed a warning or a fine of no more than one day's wage deduction, the interrogation may be oral, provided that this is documented in the record.

Article 72:

The employee must be notified in writing of the decision to impose a penalty on him. If he refuses to receive the notification or is absent, the notice shall be sent by registered mail to his address listed in his file. The employee has the right to file a written grievance with the competent authority at the employer’s side within thirty days, excluding official holidays, from the date he is notified of the decision. If his grievance is rejected or no decision is made in writing within fifteen days of submission, the employee has the right to appeal the decision before the labor courts within thirty days, excluding official holidays, from the date his grievance was rejected or the expiration of the specified period for resolving the grievance, whichever is earlier.

Article 73:

The employer shall record the fines imposed on the worker in a special register, indicating the worker's name, wage amount, the amount of the fine, the reason for its imposition, and the date thereof. These fines may only be used for the benefit of the establishment's workers, and their disbursement shall be decided by the workers' committee in the establishment. In the absence of such a committee, the disbursement of fines shall be subject to the approval of the Ministry.

Section 3

Employment Contract

Article 74:

The employment contract shall terminate in any of the following cases:

If both parties agree to terminate it, provided that the employee's consent is in writing.
If the specified term of the contract expires, unless the contract has been explicitly renewed in accordance with the provisions of this system; in which case, it shall continue until its term.
Based on the will of one of the parties in contracts of indefinite duration, in accordance with Article (75) of this Law.

3 (Repeated) Resignation

Upon the employee reaching the retirement age as stipulated by the Social Insurance Law, unless both parties agree to continue employment beyond this age.
Force Majeure
Permanent closure of the establishment.
Termination of the activity in which the worker is employed, unless otherwise agreed.

7 (Repeated) Issuance of a final resolution or ruling by the competent court to terminate the employee's contract in any of the bankruptcy proceedings initiated under the Bankruptcy Law.

Any other situation specified by another regulation.

Article 75:

1. If the contract is of indefinite duration and the salary is paid monthly, either party may terminate it for a legitimate reason, as follows:

a. If the termination is initiated by the employee, they must provide written notice to the employer at least thirty (30) days prior to the termination date.

b. If the termination is initiated by the employer, they must provide written notice to the employee at least sixty (60) days prior to the termination date.

2. If the contract is of indefinite duration and the salary is not paid monthly, the party terminating the contract based on a legitimate reason, whether the employee or the employer, must provide written notice to the other party at least thirty (30) days before the termination date.

Article 76:

If the party terminating an indefinite-term contract fails to observe the notice period stipulated in Article (75) of this Law, they shall be obligated to pay the other party an amount equal to the worker's wage for the same notice period, unless the two parties agree otherwise.

Article 77:

Unless the contract includes specific compensation for its termination by either party for an illegitimate reason, the party prejudiced by the termination of the contract shall be entitled to compensation as follows:

Fifteen days' wages for each year of the worker's service, if the contract is for an indefinite term.
1. Wages for the remaining period of the contract, if the contract is for a fixed term.
2. The compensation referred to in paragraphs (1) and (2) of this Article shall not be less than the worker's wages for a period of two months.

Article 78:

If the notice is given by the employer, the worker shall be entitled to be absent for a full day per week or for eight hours during the week during the notice period to search for other employment, while being entitled to pay for that day or those hours of absence. The worker shall have the right to determine the day and hours of absence, provided that the employer is notified of this at least one day prior to the absence. The employer may exempt the worker from working during the notice period, while considering their period of service continuous until the end of that period. The employer shall remain obligated to all resulting implications, particularly the worker's entitlement to wages for the notice period.

Article 79:

The employment contract shall not terminate upon the death of the employer, unless their personal attributes were taken into consideration when concluding the contract. However, it shall terminate upon the death of the worker or their inability to perform their work, as evidenced by a medical certificate issued by the authorized health authorities or the authorized physician appointed by the employer.

Article 79:(Bis)

The resignation request is considered accepted if thirty (30) days have passed since its submission without a response from the employer. The employer has the right to postpone the acceptance of the resignation request for a period not exceeding sixty (60) days if the interests of the work require it, and based on a written explanation provided to the employee. The postponement of acceptance must occur before the expiration of the thirty (30) days mentioned in this paragraph. The duration of the postponement of acceptance is calculated from the date the written explanation mentioned in the previous paragraph is provided to the employee.
The employment contract ends upon the resignation being accepted by the employer, or after the thirty-day period mentioned in paragraph (1) of this article has passed without a response from the employer, or upon the expiration of the postponement period for acceptance as referred to in paragraph (1) of this Article.
The employee has the right to withdraw the resignation request within a period not exceeding (7) days from the date of its submission, unless the employer accepts it before the withdrawal.
A deferred date of resignation shall not be specified in the resignation request.
The employment contract remains valid during the resignation request period, and both parties to the contract are obligated to fulfill all obligations arising therefrom during that period.
An employee whose contract is terminated by resignation is entitled to all rights stipulated under this Law.

Article 80:

The employer may not terminate the contract without rewarding, notifying, or compensating the worker, except in the following cases and provided that the worker is given the opportunity to state their reasons for objecting to the termination:

If the worker commits an assault on the employer, the responsible manager, or one of their superiors or subordinates during work or due to it.
If the worker fails to fulfill their essential obligations arising from the employment contract, or disobeys lawful orders, or intentionally disregards the clearly posted safety instructions for work and workers, despite being given a written warning.
If the worker is proven to have engaged in misconduct or committed an act involving dishonesty or breach of trust.
If the worker intentionally commits any act or omission with the aim of causing material loss to the employer, provided that the employer notifies the competent authorities of the incident within twenty-four hours of becoming aware of its occurrence.
If it is proven that the worker resorted to forgery to obtain the job.
If the worker is appointed under probation.
If the worker is absent without a legitimate reason for more than thirty days during one contractual year, or for more than fifteen consecutive days, provided that the dismissal is preceded by a written warning from the employer to the worker after twenty days of absence in the first case and ten days of absence in the second case.
If it is proven that the worker exploited their job position unlawfully to achieve personal gains and benefits.
If it is proven that the worker has disclosed industrial or commercial secrets specific to the work they perform.

Article 81:

The worker shall be entitled to leave work without notice, while retaining all their statutory rights, in any of the following cases:

If the employer fails to fulfill their essential contractual or statutory obligations towards the worker.
If it is proven that the employer or their representative engaged in deception towards the worker at the time of contracting with regard to the terms and conditions of work.
If the employer, without the worker's consent, assigns them work that differs fundamentally from the work agreed upon, and contrary to the provisions of Article (60) of this Law.
If the employer, a member of their family, or the responsible manager commits an act of assault characterized by violence or an act violating public morals towards the worker or a member of their family.
If the treatment by the employer or the responsible manager is characterized by harshness, injustice, or humiliation.
If there is a danger in the workplace that threatens the worker's safety or health, provided that the employer was aware of its existence and did not take measures indicating its removal.
If the employer or their representative, through their actions, particularly their unfair treatment or breach of the contract terms, has compelled the worker to appear as though they are the one who terminated the contract.

Article 82:

The employer may not terminate a worker's service due to illness before the worker has exhausted the specified periods of sick leave stipulated in this Law. The worker has the right to request that their annual leave be combined with their sick leave.

Article 83:

If the work entrusted to the worker allows them to become acquainted with the employer's clients, the employer may, in order to protect their legitimate interests, stipulate that the worker shall not compete with them after the termination of the contract. For this condition to be valid, it must be written, specific in terms of time, place, and the nature of the work, and its duration must not exceed two years from the date of the termination of the relationship between the two parties.
1. If the work entrusted to the worker allows them access to the employer's business secrets, the employer may, in order to protect their legitimate interests, stipulate that the worker shall not disclose these secrets after the termination of the contract. For this condition to be valid, it must be written and specific in terms of time, place, and the nature of the work.
2. Notwithstanding the provisions of this Law, the employer may file a lawsuit within one year from the date of discovering the worker's violation of any of their obligations stipulated in this Article.

Section 4 End of Service Indemnity

Article 84:

Upon the termination of the employment relationship, the employer shall pay the worker an end-of-service indemnity calculated on the basis of half a month's wage for each year of the first five years of service, and one month's wage for each subsequent year. The last wage received shall be the basis for calculating the award. The worker shall be entitled to a pro-rata award for fractions of a year worked.

Article 85:

If the employment relationship ends due to the worker's resignation, they shall be entitled in this case to one-third of the end-of-service award after a continuous service period of not less than two years and not more than five years. They shall be entitled to two-thirds of the award if their continuous service period exceeds five years but does not reach ten years. They shall be entitled to the full award if their continuous service period reaches ten years or more.

Article 86:

As an exception to the provision of Article (8) of this Law, it may be agreed that all or some commission amounts, sales percentages, and similar elements of the wage paid to the worker that are inherently subject to increase or decrease shall not be included in the wage on which the end-of-service award is calculated.

Article 87:

Notwithstanding the provisions of Article (85) of this Law, the full end-of-service award shall be payable in the event of the worker leaving work due to force majeure beyond their control. A female worker shall also be entitled to the full award if she terminates the contract within six months from the date of her marriage contract or within three months from the date of her delivery.

Article 88:

Upon the termination of a worker's service, the employer shall pay their wages and settle all their entitlements within a maximum period of one week from the date of the termination of the contractual relationship. However, if the worker is the one who terminated the contract, the employer shall settle all their entitlements in full within a period not exceeding two weeks. The employer may deduct any debt owed to them by the worker due to the work from the amounts owed to the worker.