The Saudi Arabian government has introduced new regulations for recruitment firms in 2025 to streamline the hiring process, enhance transparency, and protect workers’ rights. These regulations are part of the Saudi Labor Law, which governs all employment-related matters, including recruitment.
Licensing Requirements for Recruitment Firms
All recruitment firms operating in Saudi Arabia must be licensed by the Ministry of Human Resources and Social Development (MHRSD). The licensing process is designed to ensure that agencies adhere to ethical recruitment practices and comply with labor laws. Firms must:
- Submit a detailed application and business plan.
- Provide proof of financial stability and operational capability.
- Maintain an updated record of recruitment activities.
Regulations for Hiring Foreign Workers
Recruitment firms must follow specific rules when hiring foreign workers, including:
- No Recruitment Fees for Workers: Agencies cannot charge job seekers any fees for their services.
- Transparent Job Information: Employers must provide accurate details regarding job roles, salaries, and benefits.
- Non-Discriminatory Hiring Practices: Employers must ensure fair treatment without discrimination based on nationality, gender, or religion.
Employment Contracts in Saudi Arabia
All employment agreements must comply with Saudi Labor Law and include:
- Job title and description.
- Salary and benefits package.
- Work hours and leave entitlements.
- Termination clauses and dispute resolution mechanisms.
Salary and Benefits Guidelines
As per the latest regulations:
- Minimum Wage: The minimum wage for Saudi employees is set at SAR 3,000 ($800) per month.
- Additional Benefits: Employees are entitled to housing and transportation allowances, medical insurance, and annual leave benefits.
- Sector-Specific Salaries: Salary structures vary based on industry, job level, and location, with higher pay scales in major cities like Riyadh and Jeddah.
Working Conditions and Employee Rights
The Saudi Labor Law enforces minimum standards for working conditions, including:
- Safe and Healthy Work Environment: Employers must adhere to workplace safety regulations.
- Maximum Working Hours: Employees cannot work more than 8 hours per day or 48 hours per week, with mandatory overtime pay for additional hours.
- Anti-Discrimination and Equal Pay Policies: Employers must ensure equal pay for equal work regardless of nationality or gender.
Resolution of Labor Disputes
Employees and employers can resolve disputes through the following mechanisms:
- Mediation: A neutral third party assists in reaching a mutual agreement.
- Arbitration: A legally binding decision is made by an independent arbitrator.
- Litigation: Cases can be taken to labor courts for legal resolution.
Employees facing unfair treatment can file complaints with the Ministry of Labor, which investigates and takes action against non-compliant employers.
Termination of Employment Policies
Employment can be terminated by either party under the following conditions:
- Employer-Initiated Termination:
- Serious misconduct.
- Poor performance or incapacity.
- Business restructuring or redundancy.
- Employee-Initiated Termination:
- Resignation with proper notice.
- Retirement.
- Unfavorable working conditions.
Severance Pay and Compensation:
- Employees are entitled to severance pay based on their tenure and reason for termination.
- Employers must provide a return ticket for expatriate workers upon contract completion.
Conclusion
The new Saudi recruitment regulations aim to enhance the efficiency and fairness of the hiring process, ensuring both employers and employees benefit from a well-regulated labor market. Compliance with these rules is essential for recruitment firms to operate legally and maintain a good reputation in Saudi Arabia.
Also Read: Saudi Labor Law 2025
