Saudi Arabia May Fine SR1 Million for Unjust Foreign Hiring

Saudi Arabia is contemplating imposing penalties of up to SR1 million on employers who employ foreign workers without genuine job placements, as the government has put forth a draft scheme for public feedback in its efforts to combat illegal recruitment practices.

This initiative combats the illegal practice of recruiting workers without actual job placements, known as “phantom labour brokerage.”

The draft scheme was proposed by the Ministry of Human Resources in Saudi Arabia includes stringent fines ranging from SR200,000 to SR1 million for recruiting one or more workers from abroad without legitimate employment opportunities.

Under the proposed measure, foreign offenders will face deportation from the country. 

The Ministry will be responsible for identifying such violations and referring them to the public prosecution for potential legal action.

Additional Information:

• In recent years, Saudi Arabia has been working to regulate its job market and enhance its competitiveness. 
• In 2020, Saudi Arabia implemented significant labour reforms, particularly in its sponsorship system.
• In 2023, the Ministry of Human Resources introduced a verification initiative through its Qiwa platform, requiring private sector organizations to record 20% of their employees’ contracts by the first quarter of 2023, 50% by the second half, and 80% by the third quarter of the year.