The Saudi Arabian Ministry of Labor and Social Development approved the reduction of working hours, or any other precautionary measures that limit the effects of the pandemic. This decision is aimed at limiting the application of the Labor Law in relation to employers severing the contractual relationship due to Force Majeure. These measures will be detailed further by the ministry in the coming days.
According to this decision, the employer in agreement with its employee can:
- reduce the worker’s wages in proportion to the number of actual work hours worked, or
- give him leaves taken from his due annual leaves, or
- give him an exceptional leave, as stipulated in the labor Law (agreed upon non-paid leave).
The regulation prohibits the employer from ending the contractual relationship should he have benefitted from any COVID-19 related state subsidy.
We note that the Ministry previously issued a regulation to sponsor 60% of wages of Saudi national employees in the private sector (for companies that cannot pay their employees’ wages) for a period of 3 months on the condition that the employer is subscribed to GOSI’s unemployment insurance.
The Ministry also made it possible to take advantage of the temporary surplus labor services through the “Ajir” portal, which facilitates the lending of employees to other businesses.
Authored by Senior Associate, Jean Abboud