Saudi Labour Law amendments: what changed for employers

When did the Labour Law amendments take effect?

The amendments were issued by Royal Decree M/44 dated 8/2/1446H and apply from 20/8/1446H, which is 19 February 2025. The Ministry of Human Resources and Social Development published the implementing regulations to apply from the same day, so the law and its detailed rules changed together for every private-sector employer.

The changes reach dozens of articles. Some only reword the old text, but several change what you write in a contract, how you count probation, how a resignation ends a contract and how many days of leave you owe. The sections below cover the changes that touch day-to-day HR and payroll in a small or mid-sized company.

This article explains the rules in plain words. It is not legal advice: for a dispute or an unusual case, read the article itself or ask a labour lawyer.

How long can probation last now?

Under the amended Article 53, probation must be written into the contract with its length stated clearly, and the total may not exceed 180 days in any case. Before the change, probation was 90 days and could be extended to 180 only by a separate written agreement. Either party may end the contract during probation.

The implementing regulations add two details. Probation may be split into several periods, as long as they follow one another and the split is written into the contract when it is signed. And some days do not count towards probation at all:

• the Eid al-Fitr and Eid al-Adha holidays;
• the National Day and Founding Day holidays;
• sick leave.

So an employee who joins shortly before Eid finishes probation a few days later than the calendar suggests. Keep the end date of each employee's probation on their record and move it when one of these days falls inside it.

What changed for notice periods and resignations?

In an open-ended contract where the wage is paid monthly, the employee who ends the contract must give at least 30 days' written notice, and the employer at least 60 days. Where the wage is not paid monthly, either side gives at least 30 days. Before, both sides had the same minimum, set in the contract.

A new Article 79 bis now sets out how a resignation works, step by step:

• A resignation counts as accepted if 30 days pass without an answer from the employer.
• The employer may postpone acceptance by up to 60 days when the work needs it, with written reasons given to the employee before the 30 days are over.
• The employee may withdraw the resignation within 7 days of submitting it, unless the employer has already accepted it.
• A resignation may not name a later date for itself, and the contract stays in force, with all its duties, while the request is open.
• An employee who leaves by resignation keeps every right the law gives them.

Article 76 still applies: the side that does not respect the notice period pays the other the employee's wage for that period, unless the two agreed on more.

Which kinds of leave changed?

Family leave and maternity leave both grew. Article 113 now gives 5 days on full pay for the employee's marriage or the death of a spouse, parent or child, 3 days for the death of a brother or sister, and 3 days for the birth of a child, to be taken within 7 days of the birth.

Maternity leave under Article 151 is now 12 weeks on full pay, up from 10. The six weeks after the birth must be taken; the other six can be placed as the employee chooses, starting at most four weeks before the expected date of birth, which a medical report from a health authority sets.

If the birth comes later than expected and less than six weeks of the leave remain, the days needed to complete six weeks are unpaid leave. In every case the employee may extend maternity leave by a month without pay, and a mother whose child is ill or has a disability that needs constant care gets one more month on full pay, plus a further month unpaid if she asks.

Can overtime now be paid with time off?

Yes, if the employee agrees. Article 107 still sets overtime pay at the hourly wage plus 50% of the basic wage, but the employer may now give paid compensatory leave instead of the money. The implementing regulations set the terms, so the swap follows clear limits rather than an informal arrangement.

• At least one and a half hours of leave for each hour of overtime, as agreed between the two sides.
• The employer may set when the leave is taken, within 60 days of the overtime unless the two agree otherwise.
• No more than 30 days of compensatory leave in a year.
• Compensatory leave not taken by the time the employee leaves is paid out.

The regulations also cap overtime at 720 hours a year, which may be exceeded only with the employee's agreement. All hours worked on official holidays and Eid days count as overtime.

What must a contract include now?

Article 51 still requires a written contract in two copies, one for each side, and now adds that it must be documented as the regulations set out. The regulations require employers to document their employees' contracts electronically on the ministry's approved platform, so a signed paper copy on file is no longer the whole job.

Under the amended Article 52 the ministry publishes a unified model for each type of contract. As a minimum, a contract names:

• the employer and the place of business;
• the employee's name, nationality, identity details and home address;
• the agreed wage, including benefits and allowances;
• the type and place of work, the start date and, for a fixed-term contract, its length;
• the main rights and duties of each side.

What new duties do employers have?

Article 61 gained three duties. An employer must not exclude, separate or favour applicants or employees on grounds of race, colour, sex, age, disability, marital status or any other form of discrimination. The employer must also provide suitable housing and transport to work, or pay a suitable cash allowance with the wage instead.

Most companies already pay housing and transport allowances, so the practical step is to check that every contract states which of the two the employee receives. That also matters for payroll: the housing allowance is part of the GOSI contributory wage, and recurring allowances count in the wage used for the end-of-service award.

Articles 84 and 85, which set the end-of-service award and the reduced award on resignation, were not changed. Our guide to the end-of-service award walks through both with worked examples.

How DynamoOS helps

Dynamo People keeps each employee's contract dates, probation and leave, and a Saudi company starts with the Labour Law leave types already set up, including 12 weeks of maternity leave and the official holidays on its holiday list. Dynamo Payroll brings approved leave and overtime into each salary slip, so the month is checked before anyone is paid.