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Companies in Saudi Arabia to be fined for delaying wages

Companies that do not pay salaries to their employees on time will be fined SR3,000 for each unpaid worker, according to a Labor Ministry decision

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Companies in Saudi Arabia that do not pay salaries to their employees on time will be fined SR3,000 ($800) for each unpaid worker, according to a Labor Ministry decision.

Dr. Abdullah Abu Thinain, undersecretary of the Ministry of Labor for inspection and work environment development, said Saturday the ministry will stop providing its services to the firms that do not comply with the wage protection program and fail to submit salary data for two months from the date of compulsory implementation of the program.

Employees of such firms will be allowed to transfer their services to another company without the approval of the current employer.

The ministry’s wage protection program for companies employing 11 to less than 100 workers will begin on Feb. 1, 2016, in various stages.

But the compulsory implementation of the program’s 9th stage for firms with 100 workers will begin on Sunday (Nov. 1, 2015). It will cover 3,595 companies employing 405,590 workers.

Abu Thinain added that the ministry is committed to the implement the wage protection program on all private sector firms so as to ensure payment of workers’ salaries and other entitlements on time, to specify salary levels in all occupations and minimize problems between employers and employees.

The ministry started the wage protection program in 2013. The first stage, which was implemented on Sept. 1, 2013, covered companies with over 3,000 employees.

Compliance with the regulations by companies employing between 1,000 and 3,000 workers became mandatory on Oct. 1, 2013. From April 1, 2015, companies with 240 employees or more were covered by the program.

This article first appeared in the Saudi Gazette on Oct. 25, 2015