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Updated protections for workers in transformation and privatization
The Saudi Cabinet's decision announced their approval to amend the regulations pertaining to the treatment of employees and workers in sectors undergoing transformation and privatization. The aim is to organize end-of-service benefits and leave entitlements, ensuring clarity in financial obligations between the transferring and receiving entities during employee transitions. The amendments stipulate that an employee's service is considered continuous after transfer, meaning the original employer bears responsibility for end-of-service benefits and leave entitlements for the period before transfer, while the receiving entity is responsible for subsequent periods, calculated based on the employee's last salary. The decision also entrusts the Board of the National Privatization Center with issuing the executive mechanism, in coordination with the Ministries of Finance and Human Resources, to ensure financial and regulatory compliance. Additionally, provisions that limited Article 18 of the Labor Law were removed to increase flexibility in implementing transformation procedures.
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