Saudi Arabia: An Employer's Duty To Upskill Its Workforce In KSA

Last Updated: 15 July 2016
Article by Sara Khoja

As many readers will know a strong theme of the KSA Labour Law (and the Ministry of Labour's current social and economic policy drive) is the promotion of the employment of Saudi nationals. Part of this policy is an emphasis on succession planning with the aim being the ultimate replacement of any foreign employee with a Saudi national.

There are several ways in which the Labour Law and its implementing regulations set out in Ministerial Resolution No 1982 dated 28/6/1437 (the Regulations) seek to promote upskilling of Saudi nationals and succession planning.  Article 42 of the Labour Law requires employers to maintain a record of succession planning and record the non- Saudi employees replaced by Saudi employees.  As part of these records, employers should maintain job descriptions for each role within the business, creating professional paths for certain skilled job categories and providing training and qualifications to ensure that over time Saudi nationals are upskilled and trained to replace expatriate labour. It is for this reason that under article 37 of the Labour Law, all non-Saudi employees must be engaged on fixed term contracts with such contracts not being renewed when a Saudi national is able to perform the role. 

An employer's duty to train its Saudi national workforce was enhanced in the amendments to the Labour Law (introduced in October 2015) with the duty under article 43 of the Labour Law on employers with 50 employees or more  increasing from a duty to train 6% of the Saudi workforce to 12% on a yearly basis.

Putting together a Training Programme

The recently published Regulations give further insight into this obligation and provide valuable instruction to employers on how to give effect to this enhanced obligation.  The Regulations clarify that an employer should put in place a specific training programme to give effect to this duty, with the programme setting out the rules and conditions of training (e.g. commitment by employee), duration, number of training hours, the theoretical and practical training aspects to be completed, and the testing methods and certificates issued.   The programme should also state the general rules and standards to be followed to raise the Saudi worker's performance level in terms of skill and productivity.

When putting together a training programme or policy, an employer should have regard to the following:

  • Formulating diverse training programmes for each of the professional levels within the organisation;
  • Identifying the professions, jobs and works most needed;
  • Setting standards in line with relevant regulatory bodies eg Saudi Commission for Heath Specialities;
  • Identifying the specific issues or topics most relevant to each professional skill level;
  • Setting adequate testing methods to verify the employee's understanding and that the employee has attained the right level of competency;
  • Providing certificates detailing the employee's name, program title, type of training, duration, the acquired skills and evaluation of the employee based on five levels of competency: fair, pass, good, very good, excellent;

Recovering of Training Costs

The actual training may be delivered 'in house' within the employer's organisation or at a training centre (properly licensed and registered).  The training can also be delivered within or outside the Kingdom. An employer can contractually agree with an employee that all training costs are recoverable if the employee fails to remain with the employer for a specific period following completion of the training. The claw back of the training costs should be commensurate or pro-rated according to the duration of the training and the period the employee remains with the business following completion.

An employer can recover the training costs in full if the employee terminates the  training before its completion date without excuse, if the employee is terminated under article 80 of the Labour Law during the training period or the 'lock in' period following completion, or if the employee resigns and leaves the organisation other than under article 81 of the Labour Law (setting out the reasons an employee may resign without notice).

Reporting Requirement

An employer is obliged to provide an annual report to the Ministry of Labour confirming the names of Saudi employees who have received training, the type of training, duration, results, final objective, and its contribution to the replacement of non-Saudis by Saudis.

Variation

There is a variation on an employer's duty to provide training under article 43 if the employer's Saudisation target is less than 12% under Nitiqat.  In such circumstances, the employer must provide training to all its Saudi workers and not only a set percentage.

For completeness, it is worth recapping on the roles which must be occupied by Saudi nationals and these are: Senior Executive Human Resources, Employee Affairs Manager, Labour Affairs Director, Personnel Relations Manager, Personnel Affairs Clerk, Personnel Affairs Clerk, Employment Clerk, Employees Affairs Clerk, Employment Clerk, Employee Affairs clerk, Attendance clerk, General reception clerk, hotel reception clerk, Patients reception clerk, Complaints clerk, Treasurer, Private security guard, Commentator, Key maker, and Customs broker.

An Employer's Duty To Upskill Its Workforce In KSA

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Authors
Sara Khoja
 
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