Saudi Arabia: Changes to the Saudisation Scheme Announced

Analysis

The Labour and Social Development Ministry has announced changes to the Saudisation scheme by introducing a Balanced Nitaqat programme launched on 11 December 2016.

The programme evaluates each company based on five different criteria, taking into consideration its size and business activities. Companies will be granted points for compliance with each separate criterion and the final score will determine the company's position in the Nitaqat classification system and eventually its ability to hire foreign nationals.

The New Criteria:

1-Cumulative Saudisation (10 points for each 1% of Saudisation calculated as an average over the past 26 weeks, maximum 1000 points);

2-Percentage of Saudi female employees (2 points for every 1%, maximum 200 points);

3-Average duration of employment of Saudi nationals (4 points for every year, maximum 100 points);

4-Average salaries of Saudi nationals (6 points for every SAR 1,000, maximum 270 points);

5-Number of Saudi nationals with high salaries (0.1 point for every 1%, maximum 10 points).