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Sunday, Jul 03, 2022

Termination of contract ‘without genuine reason’ pushes 12,500 Saudis to leave their jobs

Termination of contract ‘without genuine reason’ pushes 12,500 Saudis to leave their jobs

A total of 12,520 Saudi male and female employees had left their jobs due to termination of their work contract without a valid reason during the second half of 2021, according to a monitoring conducted by Okaz/Saudi Gazette based on government reports.
It was found that 5,761 Saudi employees had submitted their resignations based on Article 77 of the Labor Law, while 6,759 employees were dismissed based on the same article.

The monitoring showed that the male employees who had submitted their resignations during the second half of last year accounted for 3,335, while the number of Saudi female employees who tendered their resignations reached 2,426, bringing the total of Saudis who had submitted their resignations under Article 77 of the Labor Law to about 5,761 employees.

Among these employees, those whose contracts were for a fixed period of time, need to pay compensation to employers for the remaining period of their contracts.

As for employees whose terms of contracts are unlimited, they have to pay compensation equivalent of 15 days’ of wages for each year of the previous period of the contract. The average number of Saudis who submitted their resignations per day is about 31 Saudis.

While the number of Saudi employees who were dismissed from their jobs based on Article 77 of the Labor Law reached about 6,759 employees, including 4,094 male employees and 2,665 female employees.

According to Article 77, when the contract is terminated by one of the parties (employer or employee) for an unlawful reason, the party affected by the termination of the contract will be entitled to get compensation equivalent to 15 days’ wages for each year of the worker’s service years if the contract is for an unlimited period of time.

However, if the remaining period of the contract is for a fixed term, the wages for the period will be paid to the affected party, and the article stipulated that the compensation should not be less than the worker’s wages for a period of two months.

As for the Saudis whose contracts were terminated based on Article 80 of the Labor Law, their number during the second half of 2021 accounted for about 15,116 male and female employees, with an average dismissal of 82 Saudi men and women per day.

Article 80 of the Labor Law included the right of the employer to terminate the worker’s contract without payment of remuneration.

The major reasons for the termination are identified in the article as follows: “The worker’s assault of his superiors or subordinates; his perpetration of an act that violates someone’s honor or trust; or his carrying out an act that leads to incurring losses for the employer; or his unauthorized absence for an intermittent period of 30 years or 15 consecutive days with a warning or the employee’s disclosure of industrial or commercial secrets.”

There will be exemptions in certain specific cases, the law points out.
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