Saudi to levy hefty fines on private firms that do not pay salaries on time

Private companies in Saudi Arabia will face hefty fines if they fail to pay salaries to their employees, local media reported.

The ministry of Labour and Social Development will levy a fine of SAR3,000 per staff member on firms that do not pay monthly salaries on time, Saudi Gazette reported.

Sources in the ministry said companies will also be fined SAR10,000 for each employee in case end of service benefits (ESB) is delayed by a maximum period of two weeks.

The ministry will also slap fines of SAR25,000 if a company fails to allocate special work places for women; SAR20,000 if it does not provide enough security guards; SAR15,000 if it employs less than two women in each shift; and SAR15,000 if a company does not have emergency exits and rescue equipment including fire extinguishers.

Fines will also be levied on companies that employ workers without written and documented work contract; make their staff work for more than eight hours a day; and refuse to give employees their weekly off-days or annual vacations, the report stated.

Companies that pay their workers in currencies other than Saudi riyals or withhold the worker’s salary or part of it without any legal justification will also be subject to fines.

According to the kingdom’s labour law, salaries have to be paid during working hours and at the workplace or, with the consent of the worker, through accredited banks in the country.

Certain construction companies in the kingdom such as now-liquidated Saudi Oger faced a major slowdown in the last few years and failed to pay their workers.

The company reportedly owed SAR2.6bn to employees in outstanding dues such as delayed salaries and allowances, end-of-service awards and other entitlements, local daily Saudi Gazette cited officials as saying earlier this year.

Read: Debts of liquidated construction firm Saudi Oger exceed SAR40bn – report