Saudi Arabia Introduces New Penalties for Labor Law Noncompliance
In late 2025, Saudi Arabia announced substantial penalties for employers who violate workplace regulations. The new fines, established after a public consultation, are part of an effort to strengthen worker protections in the kingdom. Saudi Arabia’s Ministry of Human Resources and Social Development is responsible for issuing the updated schedules.
The new penalties
Worker transfers: Employers that allow their workers to leave and work for other parties can be fined between 10,000 SAR (~$2,666 USD) and 20,000 SAR (~$5,333 USD).
Maternity leave provisions: Organizations that fail to comply with maternity leave provisions will be fined 1,000 SAR (~$266 USD) for each instance of noncompliance. Employers that do not provide childcare facilities for eligible employees will be fined 3,000 SAR (~$800 USD).
Unlicensed recruitment: The unlicensed recruitment of nationals by employers can result in fines of up to 200,000 SAR (~$53,333 USD). Unauthorized recruitment services can be fined as much as 250,000 SAR (~$66,666 USD).
Environmental compliance breaches: Employers that breach internal or external environmental requirements face fines of 500 SAR (~$133 USD).
Inadequate misconduct investigations: Employers that fail to properly investigate workplace misconduct within five working days or fail to set up investigation committees can face fines of 1,000 SAR (~$266 USD) to 3,000 SAR (~$800 USD).
Escalating penalties
In the case of repeated violations, penalties may be doubled. When multiple individuals are affected by a violation such as wage payment failures, discrimination, or unsafe working conditions, the resulting fine may be multiplied by the number of people impacted. Severe violations can lead to fines of up to 100,000 SAR (~$26,666 USD), closure of the firm for up to 30 days, or permanent closure of the firm.
To avoid these fines, employers should assess their HR operations and their frameworks for licensing and compliance to ensure they are fully aligned with the regulations.
