KSA: Employment Update in the Private Sector in The Wake of Covid-19

KSA DECISION ISSUE NUMBER 142906 

In light of the COVID-19 situation in the Kingdom of Saudi Arabia (KSA), on 12 April 2020, the Ministry of Human Resources and Social Development (the Ministry) issued Decision Issue Number 142906 (the Decision), effective immediately and allowing employers and employees in the Kingdom to regulate their contractual relationship. 

PERMITTED ACTIONS 

The Decision outlines guidelines to help private companies navigate during the KSA’s period of applying COVID-19 precautionary measures, subject to any further announcements by the Ministry and government. 

The Decision added Article 41 to the KSA Labor and Workmen Law (the Labor Law), enabling employees and employers to agree within the first six (6) months following the start of the enforcement of the country’s precautionary procedures on either of the following:  

1.    Reduce the employee's wage; 
2.    Grant the employee a leave to be deducted from his/her annual leave; 
3.    Grant the employee an exceptional leave.

It is of importance to note that the implementation of such measures will not be justified if the employer received assistance from the government during this period and nothing in the Decision prevents the employee's right to terminate his/her employment contract.

HOW CAN TLG HELP? 

Our branch office in KSA along with our proactive Corporate & Commercial Team are pleased to provide you with further information, answer your questions and support with assessing applicability and implementation of the Decision on your Company or assist with business restructuring in the Kingdom. 

Please feel free to contact our Corporate & Corporate Division at: corporate@tlg.ae.