On 4 November 2020, the Ministry of Human Resources and Social Development (MHRSD) announced certain labor reforms for foreign national employees working in the private sector that will come into effect on 14 March 2021. Since the initial announcement, the MHRSD (in coordination with the National Transformation Program and National Information Center) announced the conditions in order to benefit from each of the initiatives. These are:
|Initiative||Current Position||Position as of 14 March 2021||Conditions|
|1||Employee Mobility||The new employer must request the foreign national’s transfer of sponsorship and the existing employer must provide a statement of no-objection.
Existing employers have the right to reject a transfer to a new employer, and instead issue the foreign national a final exit visa which would make it cumbersome, costly, uncertain and slow for the foreign national to return to the Kingdom on the sponsorship of a new employer.
If the current employer provides a no-objection statement, the employee will transfer to the new employer, assuming it will not cause the new employer to be below the “medium green” level for Saudization purposes.
The new employer is responsible to pay all government fees to transfer the foreign national’s sponsorship. This is SAR 2,000 if it is the individual’s first transfer of sponsorship, SAR 4,000 for a second transfer and SAR 6,000 for a third transfer (or more than third transfer).
|The foreign national employee will no longer require the existing employer’s consent in order to transfer, subject to certain conditions as listed in the next column.
There will be no fees to transfer sponsorship as is currently the case.
|The foreign national employee must:
The new employer must:
|2||Exit / Re-entry Visa||Foreign nationals require a visa to exit and re-enter the Kingdom. This is issued by the employer through its Muqeem online portal.
The exit / re-entry can be issued for a single exit and re-entry, or multiple exit and re-entries over a certain period of time, for example six months, one year, two years. At present, a single exit / re-entry visa is SAR 200 and is valid for maximum two months (outside of the country which can be extended for SAR 100 for each additional extra month within the validity of the employee’s residency permit). A multiple exit re-entry visa is SAR 3,000 for six months, SAR 5,000 for one year and SAR 8,000 for two years.
The cost of the foreign national employee’s exit / re-entry visa must be borne by the employer and cannot be charged to the employee. (The foreign national employee can issue an exit / re-entry visa for his/her dependents through his/her Absher online account and will pay the fee directly.
|The employee can issue his/her own exit / re-entry visa without the employer’s consent through his/her Absher online account, subject to certain conditions. The employer will not be entitled to cancel the employee’s exit / re-entry visa.
The employee will be responsible to pay the cost of his/her exit / re-entry visa. Some employers may decide to reimburse their foreign national employee this cost. The employee can still issue exit / re-entry visas for his/her dependents and will be able to cancel his/her, or his/her dependents’ exit / re-entry visa during the validity period.
If the employee leaves the Kingdom and fails to return, he/she may be subject to applicable penalties for unlawfully terminating the employment contract.
|The employee must:
|3||Final Exit Visa||An employer has the right to issue a foreign national employee with a final exit visa at any time, even if such employee wishes to remain in the Kingdom and transfer to another employer.
A foreign national employee has 60 days from the final exit visa to leave the country. There is no fee to issue a final exit visa.
The employee can issue a final exit visa for any of his/her dependents at any time through his/her Absher account.
|The employee will be able issue his/her own exit / re-entry visa without the employer’s consent through his/her Absher account, subject to certain conditions. The employer will not be entitled to cancel the final exit visa.
The employee can still issue a final exit visa for his/her dependents and will be able to cancel his/her, or his/her dependents’ final exit visa during the validity period.
If the employee leaves the Kingdom prior to the expiry of his/her employment contract he/she may be subject to applicable penalties for unlawfully terminating the employment contract.
|The employee must:
Note on Employee Mobility: If the above mentioned conditions to transfer sponsorship without the current employer’s consent are not met, there are other circumstance in which the foreign national employee could transfer his/her employment. These are:
- if the employee does not have a documented contract, taking into consideration that the deadline to have a documented contract is three months from the employee’s date of entry into the Kingdom
- if the employee has not received a salary for three consecutive months
- if the employer is absent due to travel, imprisonment, death, or any other reason
- if the employee’s work permit or visa has expired
- if the employee reports a violation of the “law against commercial cover-up” by the employer (this law prohibits and penalizes schemes aimed at evading – and covering up violations of – the foreign investment laws), provided the employee is not involved in the “cover-up” activity
- if a labor dispute arises between the employee and the employer, and the employer or his representative fails to attend two litigation hearings at any judicial level despite being notified of the hearing dates or not attending two amicable settlement hearings, or
- if the current employer approves the employee’s transfer of sponsorship.