Saudi Arabia Amends Labor Law Executive Regulations

Saudi Arabia recently amended the executive regulations to its labor law. The new amendments make it easier for expatriate workers to change their employment status. Originally, foreign workers had to respect the mandatory one-year minimum period of employment with a single employer before being permitted to seek alternative employment. Now, expats can switch employers during that period with the current employer’s consent. Another key amendment is that expats no longer require their previous employer’s consent to start working for a new employer once the mandatory minimum has expired, as long as the employee notifies the first employer 90 days before the expiry of the contractual term. The amendments to the executive regulations chip away at the vestiges of Saudi Arabia’s kefala, or sponsorship system, which severely limited foreign employees’ freedom to contract. They also promote a labor market that welcomes foreign investment while remaining committed to the Saudization of the workforce.