Saudi private-sector employers whose businesses have been crippled by the coronavirus pandemic have been told they can cut their employees’ wages and working hours.
A ministerial decision was issued in Saudi Arabia on Sunday to regulate the labor contract during exceptional circumstances caused by the coronavirus outbreak.
It stipulates reducing salaries in the private sector by 40 percent with the possibility of terminating the contracts.
The new decision has also included a provision in which the employer would be allowed to cut wages even he or she is entitled to the subsidy provided by the government, such as those for helping pay workers’ wages or exemption from government fees.
But they may do so only with the employees’ consent, and the reduced wages must accurately reflect the number of hours worked, the Ministry of Human Resources and Social Development said.
“Workers can report any violation through the ministry’s website, channels and social media platforms,” Saad Al-Hammad, director of Human Resources Affairs at the ministry revealed.
The ministry said its aim was to protect employees from dismissal or loss of contractual benefits during the pandemic. It would continue to regulate the labor market, mitigate the economic effects of the virus outbreak on the private sector and protect the interests of both parties in the labor relationship, it said.
The decision also specified the conditions in which that employers are entitled to terminate any employee;
- First the passing of six months since the measures of salary cut has been taken.
- Reducing pay, annual leave and exceptional leave were all used.
- Company proves that its facing financial troubles due to the circumstances.
These developments come in line with the actions taken by Saudi Arabia to address the coronavirus pandemic and consider it a force majeure in the contracts signed with employees in the Saudi labor market.
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