Advantages of a notarized employment contract as an enforceable instrument for wage protection

The Ministry of Human Resources and Social Development in Saudi Arabia announced the launch of the second phase of its initiative to recognize the notarized employment contract as an enforceable document. This strategic step will encompass fixed-term contracts upon their renewal or extension after expiry. The notarized employment contract is a cornerstone of the Ministry's ongoing efforts to enhance the reliability of contractual relationships and improve the efficiency of procedures related to safeguarding the rights of all parties involved in employment, thereby creating a safe and stable work environment for everyone.

Digital transformation and the evolution of the work environment in Saudi Arabia

Over the past few years, Saudi Arabia has witnessed radical transformations in its labor market, driven by the objectives of Vision 2030, which aims to attract global and local talent. Historically, labor disputes were often lengthy and protracted in the courts, prompting relevant authorities to launch successive programs such as the Wage Protection Program and the electronic documentation of contracts. This announcement is a logical and historical continuation of efforts to digitize the labor sector, as traditional paper contracts have been replaced by legally binding digital contracts with the force of an enforceable instrument. This streamlines legal procedures and accelerates the process of securing rights in an unprecedented manner.

Key advantages of a notarized employment contract for the parties involved in the contractual relationship

A legally binding employment contract offers a range of essential advantages that ensure transparency and fairness in the workplace, most notably:

• The contract is digitally linked directly to the Wage Protection Program, which facilitates monitoring establishments’ compliance with paying salaries on time.
• The contract ensures full compliance with the latest amendments to the Saudi labor law, thus preventing companies from falling into legal violations.
• It provides complete clarity on all elements of pay, including commissions, allowances, and other financial benefits, preventing any future confusion.
• It precisely regulates the provisions for the probationary period, the duration of the contract, and the procedures for resignation or termination of the employment relationship.
• It provides a detailed table of legal and labor terminology definitions to standardize understanding between the worker and the employer.

Steps to benefit from the executive bond through the Qiwa and Najiz platforms

The Ministry of Human Resources clarified that benefiting from this service requires first documenting or updating the contract through the approved “Qiwa” platform, and then obtaining an enforcement number from the Documentation Center affiliated with the Ministry of Justice. In a move aimed at expediting justice, if a worker does not receive their full wages within 30 days of the due date, or receives only a portion of them after 90 days, they have the right to submit a direct electronic enforcement request through the “Najiz” platform of the Ministry of Justice. To ensure fairness for both parties, the employer has the right to object within five days of being notified of the request.

Local and international impact to enhance labor market stability

The implementation of these decisions has far-reaching implications. Locally, this measure will reduce the influx of labor cases to labor courts, thus easing the burden on the judicial system and increasing worker productivity due to job and financial security. Regionally and internationally, these steps will enhance the Kingdom's position as an attractive environment for foreign investment and highly skilled professionals. They also reflect Saudi Arabia's commitment to the International Labour Organization's (ILO) international standards regarding the protection of workers' rights, which will positively impact the Kingdom's ranking in global labor market competitiveness indices.