Unfair dismissal in Saudi labor law refers to an employer terminating an employee’s employment without prior notice or for unjustified legal reasons, or by ending the contract before the agreed-upon term. If an employer dismisses an employee without a legitimate reason, it is considered unfair dismissal, and the employer is obligated to compensate the employee as stipulated in Saudi law.
Instances of Unfair Dismissal:
According to the Saudi Labor Law, the following actions by an employer constitute unfair dismissal:
- Terminating an employment contract for reasons not specified in Article 80 of the Saudi Labor Law.
- Failing to provide the employee with written notice of termination at least 30 days in advance if the employee is paid weekly or daily, and 60 days in advance if paid monthly.
- An employee’s absence from work without notifying the employer is considered unfair dismissal if the employer has not adhered to the contract, or if the employer has engaged in fraud or deception in the contract, or if the employer has assigned the employee tasks that do not align with their duties, or if the employer has assaulted the employee or subjected them to unethical behavior.
Circumstances for Dismissal Without Prior Notice:
Article 80 of the Saudi Labor Law outlines certain circumstances where an employer can terminate an employment contract without prior notice or compensation:
- Failure of the employee to perform their assigned duties.
- Assaulting the employer or a subordinate, whether verbal, physical, or psychological.
- Intentionally causing financial loss to the company.
- Revealing company secrets that cause harm.
- Misusing the job to obtain illegal gains.
- Forgery or manipulation of employment documents.
- Absenteeism of 30 non-consecutive days or 15 consecutive days within a year.
- During the training or probation period.
- Engaging in immoral or dishonest behavior.
- Failure to follow work procedures or safety regulations.
Compensation for Unfair Dismissal
An employee who is unfairly dismissed is entitled to compensation as follows:
- Fixed-term contracts: The employee is entitled to compensation for the remaining period of the contract.
- Indefinite contracts: The employee is entitled to compensation of 15 days’ wages for each year of service.
- End-of-service gratuity: Employees who are unfairly dismissed are entitled to full end-of-service gratuity.
Legal Reasons for Dismissal
There are legitimate reasons for dismissing an employee without compensation:
- Expiration of the employment contract.
- Reaching the retirement age (60 for men, 55 for women).
- Closure of the establishment.
- Mutual agreement to terminate the contract.
- If the contract is indefinite, either party can terminate it with prior notice.
Penalties for Unfair Dismissal
The Ministry of Human Resources and Social Development has imposed penalties for repeated instances of unfair dismissal, including:
- Barring the establishment from participating in the “Sand” initiative.
- Suspending services provided to the establishment.
- Requiring the establishment to increase compensation for unfairly dismissed employees.
In conclusion, Saudi labor law provides significant protections for employees against unfair dismissal. By understanding these regulations, both employers and employees can ensure fair and equitable employment practices.
