Saudi Arabia slashes fines for labour law violations by up to 94%
Kingdom overhauls penalty system to enhance labour market compliance
Dubai: Saudi Arabia has announced a significant reduction in penalties for violations of the labour law and its executive regulations, cutting fines by up to 94 per cent from the levels set in 2021.
The revision, issued by the Minister of Human Resources and Social Development Minister Ahmad Al Rajhi adjusts the fines based on the size and category of establishments.
Also read
- Saudi Arabia opens first virtual school for orphans and underprivileged children
- Saudi Arabia: Licenses of 10 Umrah firms revoked for repeated failings
- Over 17,000 arrested in Saudi Arabia for residency, labour and border security violations in a week
- Louvre Abu Dhabi: Art Here 2023 exhibition opens with works of Emirati, Saudi, Kuwaiti, Indian, Syrian artists
According to Okaz, the penalty for delayed wage and allowance payments to workers is now set at SR300 for each worker, irrespective of the establishment’s size.
Previously, penalties for late payments varied from SR2,000 to SR5,000, depending on the size of the establishment, with larger ones facing higher fines.
The amendments also saw a reduction in fines for employing women during the six weeks post-delivery, now set at SR1,000, down from SR10,000.
Medical insurance coverage
Fines for failing to provide medical insurance coverage to workers and their families have also been modified.
For smaller establishments with 20 or fewer workers, the fine is SR3,00, increasing to SR500 and SR1,000 for medium and larger establishments, respectively.
In addition, the revised fines include a SR1,000 penalty, regardless of establishment size, for employing Saudi workers in professions reserved exclusively for Saudi female workers.
Before the amendment, these fines ranged from SR2,500 to SR10,000 based on the establishment’s size.
The amendments also drastically reduced fines for falsely registering a Saudi worker without actual employment.
Penalties now range from SR2,000 to SR8,000, depending on the size of the establishment, significantly lower than the previous range of SR5,000 to SR20,000.
These amendments, part of the ministry’s ongoing efforts to review labour market regulations, aim to support the stability and growth of establishments, protect workers’ rights, and enhance the labor market’s attractiveness and flexibility.
The new fine structure takes into account the varying sizes of private sector establishments, categorized into three groups based on the number of workers, to ensure compliance and support for businesses.