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Saturday, 13 August 2016

10 kinds of expat related penalties imposed on companies in Saudi Arabia

In 2014, Saudi Arabia’s Ministry of Labor has imposed fine of totaling SR10 million ($2.6 million) on companies violating the labor rules. Deputy labor minister, Abdullah Abu Ethnian was quoted that almost 62,762 violation cases were recorded during inspections. The Ministry recorded 9,500 cases of employing expats without sponsoring and about 3,400 cases of not providing proper environment to female staff. About 2,200 cases were also recorded against those companies who forced their workers to work out in ban summer months. Last year, October 2015, it was said that companies of Saudi Arabia will be charged or their license will be canceled if they violate any rules and regulations announced by Saudi Ministry Of Labor.


  1. Company will pay penalty of SR 2000/- per employee if they keep worker’s passport. Recommended: Legality of Holding Passport by Employer
  2. As stated by Saudi Labor Law, weekends are not included in employees’ annual leave. Organizations will pay a fine of SR 100,000 if they count weekends in employee’s yearly clear out. No particular organization has authority to force workers to work on weekends because weekends are official paid leaves. Furthermore no company has authority to deduct pay for weekends. Recommended: Weekends are not part of Annual Leave, SR 100,000 fine for Violation
  3. The Ministry of Labor and Social Development has imposed fines around SR 250,000 from claiming organizations to Madinah that compelled laborers to perform tasks under hot days which are ban in summer months. Recommended: Work Ban in Afternoon Hours in Saudi Arabia
  4. A fine of SR 50,000 will be imposed on those employers who are caught selling visas to expatriates. Recommended: SR 2,000 for keeping worker’s passport and SR 50,000 fine for selling visas
  5. A fine of SR 15,000 per employee is imposed on those employers who force their workers to perform jobs which are not listed on their iqama.
  6. SR 25,000 fine will be imposed on those employers who don’t comply for Health and Safety requirements as stipulated in Saudi Labor Law.
  7. Companies should provide detailed contract copies to workers otherwise fine will be charged SR 5,000 per employee.
  8. Fine of SR 45,000/- will be charged on companies who hire professional employee without having license. Tests and interviews should be conducted and minimum 3 years’ experience should be compulsory. After verification of certificates expat employee will get Iqama card (residence permit). Fresh graduates will go through a test on basic principles and experienced expat will be tested for direct post
  9. Penalty of SR 10,000 will be charged from companies who will appoint male workers on designations reserved for female workers.
  10. SR 25,000 will be penalized to owner on providing wrong information on businesses and SR 10,000 will be charged by Investigation officer of Ministry. Double fine will be charged on the companies who commit same violation again and it will be treated as repetition of violation if company will not pay fine.
Job Continuation under Saudi Labor Law
  1. Weekends are not part of Annual Leave, SR 100,000 fine for Violation
  2. Am I entitled to get Transportation Allowance during annual leave?
  3. Article 77 of Saudi Labor Law – Good for Expats but Bad for Saudis
  4. Rules related to Annual Leave under Saudi Labor Law
  5. Rules related to Maternity Leave for working women under Saudi Labor Law

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