It’s hard enough to set up a company in Saudi Arabia without having to navigate the Saudi Labour Law. But mastering it is what separates reactive businesses from resilient ones. Understanding the law gives you a clear edge: it protects your company, strengthens your team, and keeps your operations running without disruption.
Key Takeaways on Saudi Labour Law
- Minimum working age: 15 for Saudis, 24 for foreign hires
- Employers can legally terminate contracts under specific conditions
- Standard probation period: 90 days (no compensation if terminated during this time)
- Annual leave: 21 days, rising to 30 after 5 years of service
- Maternity leave: up to 10 weeks, with full or half salary based on tenure
- Emergency, Hajj, Umrah, and marriage leave are granted under set rules
- Employers must treat staff fairly and avoid actions that lead to disputes
- Absher Business helps you stay compliant and focus on growing your company
Why Saudi Labour Law Matters for Your Business
Compliance with Saudi Labour Law ensures the stability of any company that operates in the Kingdom. It supports a healthy employer employee relationship, strengthens the company’s reputation, and reduces the likelihood of disputes.
When employers follow the law, they create a workplace based on trust, transparency, and professionalism. This also helps attract skilled talent who prefer working in well-regulated environments.
Read More: Human Capital Investment
Legal Working Age in Saudi Arabia
Working Age for Saudi Nationals
- The minimum legal working age is 15.
- Individuals under 15 cannot be employed or allowed into workplaces.
- Young people aged 13 to 15 can work in light activities that do not harm their health, affect their growth, or interfere with their education.
- Employers must verify the applicant’s age through a national ID or passport before hiring.
Working Age for Foreign Employees
- The minimum age for hiring a foreign worker is 24.
- Work visas or employment permits cannot be issued for someone younger than this age.
Employer Rights Under Saudi Labour Law
Saudi Labour Law provides employers with clear rights that support proper business operations. These include:
- Using the employee’s skills and experience based on what is written in the employment contract.
- Making administrative and operational decisions such as assigning duties, approving leave requests, and applying disciplinary actions.
- Protecting the company’s interests and intellectual property, including client data and commercial information.
- Setting recruitment standards that match the company’s needs.
- Ending the employment contract in line with the law when an employee violates company rules or fails to perform tasks.
- Requesting compensation for any material or moral damage caused by negligence or violations.
Probation Period Rules
- The standard probation period under Saudi Labour Law is 90 days.
- Sick leave and Eid holidays are not counted as part of the probation period.
- Either party may terminate the contract during probation without compensation or end of service benefits.
- When the employee completes probation with positive performance, annual leave entitlement begins.
Annual Leave Entitlement
Saudi Labour Law grants employees:
- 21 days of paid annual leave each year.
- 30 days once the employee completes five continuous years with the company.
- Important rules for employers:
- The employee should use their annual leave within the year of entitlement.
- Unused leave days cannot be carried over or compensated with cash.
- Employers may schedule annual leave based on work needs.
- Employers may rotate leave between employees to maintain smooth operations.
- Employers and employees may agree to delay a portion of annual leave when required by work conditions.
Emergency Leave
Employees are entitled to emergency leave in unexpected circumstances such as accidents, illness, or death in the family. Proof must be provided. Employers are encouraged to support employees in such situations since a respectful workplace increases loyalty and commitment.
Hajj and Umrah Leave
Hajj Leave
- Employees in both the public and private sectors may take paid leave for Hajj when:
- They have completed at least two continuous years with the employer.
- The leave is granted only once during the entire employment period.
- The duration is between 10 and 15 days including the Eid Al Adha holiday.
Umrah Leave
- Umrah leave ranges from 10 to 15 days.
- The exact number of days depends on what is stated in the employment contract.
- Employers may limit the number of employees on leave based on operational needs.
Marriage Leave
Employees are entitled to 5 paid days for marriage. The employee must inform the employer in advance to allow proper planning and workload distribution.
Provisions for Pregnant Employees
Saudi Labour Law includes clear protections for pregnant employees:
- Employers must provide medical care during pregnancy.
- Employees cannot be dismissed for pregnancy related illness when supported by a certified medical report.
- The maximum allowed absence related to pregnancy is 180 days within one year, whether continuous or intermittent.
Maternity Leave
Maternity leave includes:
- 4 weeks before the expected delivery date.
- 6 weeks after delivery.
- The expected date must be supported by a certified medical certificate.
Salary during maternity leave:
- Half salary if the employee has worked for one year or more.
- Full salary if the employee has worked for three years or more.
How to Reduce Absenteeism Risks
Unplanned employee absence can disrupt operations and weaken team morale. To prevent it, employers should:
- Honor every clause in the employment contract
- Share accurate, transparent information during hiring and onboarding
- Foster a respectful work environment that values employee dignity
- Avoid assigning tasks outside the agreed scope without clear consent
- Focus on creating a workplace culture built on trust, clarity, and support
- When employees feel respected and treated fairly, they’re far less likely to walk away without notice.
Legal Grounds for Termination
Saudi Labour Law permits employers to terminate employment in specific cases, including:
- Physical assault in the workplace
- Breach of confidentiality or disclosure of sensitive company information
- Continued underperformance despite written warnings
- Misconduct or behavior that violates professional standards
- Deliberate damage to company property
- Forgery of documents or certificates submitted during hiring
- Exploiting the job role for personal benefit
- Inadequate performance during the probation period
How to Choose the Right Employee
Hiring the right team member is one of the most important decisions you’ll make. Look for candidates who demonstrate:
- Relevant experience and job-specific knowledge
- Alignment with your company’s values and work ethic
- Sound judgment and the ability to solve problems under pressure
- Strong communication and collaboration skills
- A clear drive for growth and continuous learning
How Absher Business Supports Your Company in Saudi Arabia
Absher Business provides guidance based on strong knowledge of Saudi Labour Law. Our team assists entrepreneurs with company setup, licensing, and government paperwork including commercial registration renewals. This support helps businesses remain compliant and operate smoothly in the Saudi market.
Read More: Investing in Saudi Arabia
