Employment laws and regulations governing labour relations are rapidly shifting in the Kingdom of Saudi Arabia. The “Saudization” system (i.e. Nitaqat) that requires employers in the private sector to hire a minimum percentage of Saudi nationals has been underway for several years. More recently, the Saudi Arabian Ministry of Human Resources and Social Development launched a Labour Reform Initiative (LRI) to replace the existing sponsorship system (i.e. kafala), which had previously placed significant constraints on foreign worker job mobility in the Kingdom.

Al-Ghazzawi and Partners can help your business successfully navigate the changing employment landscape. Throughout our five decades of practice, we have strongly believed that maintaining sound employer-employee relations is critical to our clients’ success. Labour disruptions, high employee turnover, fraud, and negligence can exact a great toll on a business – as does being offside with labour regulations.

Managing Labour Disputes in Saudi Arabia Requires Expert Guidance

In past years, labour disputes were referred to the Ministry of Labour Commission and the High Commission for the Settlement of Labour Dispute. Today, Labour disputes are referred to new specialized courts established pursuant to Royal Decree No. 20712. There are seven labour courts across the Kingdom in Riyadh, Jeddah, Dammam, Makkah, Madina, Buraydah, and Abha. In addition, there are 27 supporting Labour Circuits and six Appeal Courts.

Clients depend on our guidance to manage labour disputes in the most timely, confidential, and cost-effective methods possible – while protecting their reputation as employers within the Kingdom.

Our employment law services regularly include:

• Representing clients at all Labour Committee and Labour Court hearings.
• Launching urgent proceedings in the Labour Committees.
• Advice on labour strategies and compensation structures.
• Drafting contracts of employment and other procedural agreements.
• Advice for new market entrants on labour laws and strategies.
• Advice on the labour implications of mergers and acquisitions.
• Advice on alternative means of dispute resolution including mediation and arbitration.
• Initiating litigation when required.
• Defending against accusations of unfair labour practices.
• Handling issues related to labour dismissal and employment benefits.
• Conducting internal investigations with employees for negligence, improper discharge of their duties, financial misconduct, fraud, misappropriation, forgery, etc.

Serving Domestic and International Clients on Matters of Employment Law

Our clients operate locally, regionally, and globally. As such, our employment legal expertise extends beyond the Kingdom. With our Cooperation Agreement with Gowlings WLG, we combine our extensive local knowledge with Gowlings’ expertise in all major global jurisdictions. This allows us to serve our international clients seamlessly and remain consistent with global best practices and their own internal employment policies.

Furthermore, growing Environmental, Social and Governance (ESG) expectations of all global companies make it increasingly critical for boards and management to familiarize themselves with how their companies are managing human capital in Saudi Arabia. The pressure to maintain fair and consistent employment standards, and avoid any appearance of exploitation, has never been greater. We assist our clients to incorporate social and human capital policies in their governance and stay ahead of both local labour laws and international best practices.

About Our Employment Law Practice Group

Our legal team regularly handles the most complex issues under employment law in the Kingdom. They are supported by our team of litigators who adeptly resolve most disputes through negotiation and mediation, well before matters reach the courts.

Notable employment law projects include:

• Advising a global communications service provider on employment issues arising from the acquisition of another international firm in the field of telecommunication and networking.
• Guiding a leading tobacco manufacturer through the dismissal of a large batch of employees.
• Aiding an oil and gas major affiliate in a claim by 130 employees for payment of early retirement benefits, saving the client over USD $13.3 million.
• Advising a large multinational industrial gas manufacturing company in its claims against a key executive for misappropriation of company funds.

Contact Our Employment Law Practice Group

No matter the complexity of your labour related challenges, our legal team has the capabilities and depth to resolve the most complex disputes. With offices located in Jeddah, Dammam, and Riyadh, we support domestic and international clients across the Kingdom. Contact us to book a consultation.