Latest Updates to the Saudi Labour Law (2025)

Latest Updates to the Saudi Labour Law (2025): Strengthening Digital Governance, Workforce Development & Family-Friendly Policies

Saudi Arabia has announced significant amendments to its Labour Law, effective February 2025, reinforcing its commitment to building a modern, transparent, and competitive labor market aligned with Vision 2030.

The reforms aim to enhance workforce protection, digitize employment processes, support national talent development, and create a more balanced and family-friendly work environment.

1. Mandatory Digital Contract Authentication - Article (52)

• Employers must digitally authenticate all employment contracts via the Qiwa platform upon commencement of employment.
• Employee records must be retained for a minimum of five years.

Goal: Boost transparency, prevent disputes, and streamline workforce compliance processes.

2. Non-Saudi Employment Contracts - Article (37)

• If the contract of a non-Saudi employee does not specify a duration, it will be deemed as a one-year contract starting from the employment date.
• It will automatically renew as long as both parties continue the employment relationship.

Goal: Enhance clarity and fairness in expatriate employment terms.

3. Probation Period Update -  Article (53)

• Maximum probation period extended to 180 consecutive days.
• Cannot be extended or repeated except in specific cases with written agreement.

Goal: Give employers a reasonable evaluation period while ensuring clarity for employees.

4. Resignation and Legal Definitions - Article (80) & New Definitions Clause

• "Resignation" is now formally defined as a written and voluntary request by the employee.
• Employer approval may be required where specified in the contract.

Goal: Standardize resignation procedures and protect employees from coercion.

5. Wage Protection & Overtime Pay - Article (107)

• Overtime compensation to be paid at not less than 150% of the basic wage.
• Stricter enforcement and penalties on wage delays or failure to issue digital pay slips.

Goal: Guarantee fair compensation and enhance payroll compliance.

6. Family-Friendly Leave Policies - Article (151) & Supplementary Clauses

• Maternity Leave: 12 weeks fully paid
• Minimum 6 weeks post-delivery, remaining weeks can be taken pre- or post-birth.
• Paternity Leave: 3 paid days within 7 days of childbirth.
• Bereavement Leave: 3 paid days for the death of a sibling (and other close relatives in some cases).

Goal: Strengthen family support structures and enhance employee well-being.

7. Training and Saudization Requirements - Article (43)

• Employers must invest in training and developing Saudi nationals.
• Clearer obligations toward preparing nationals to replace expatriate workers progressively.

Goal: Support national workforce development under Vision 2030.

What These Changes Mean for HR & Employers?

These reforms require organizations in Saudi Arabia to reassess and update their HR strategies and internal policies to ensure full compliance. 

Employers must now rely on digital platforms such as Qiwa to authenticate employment contracts and maintain accurate electronic records, while also strengthening payroll systems to guarantee timely salary payments and adhere to overtime regulations. 

HR departments should review and revise employment contracts, employee handbooks, and internal procedures to align with the new rules, particularly regarding probation periods, resignation procedures, and leave entitlements. 

Moreover, companies are expected to enhance training and development initiatives to support the nationalization agenda and prepare Saudi talent for future leadership and operational roles. By embracing these changes, organizations can build a compliant, transparent, and supportive work environment that meets evolving legal standards and fosters long-term workforce stability.