Saudi Court Orders SR275,000 Compensation for Unfair Dismissal of Employee Over Unpaid Wages

A Saudi court has mandated a Riyadh-based company to compensate an ex-employee with SR275,000 after finding her dismissal over unpaid wages was unjust.

Court Ruling on Arbitrary Dismissal

A labour circuit at the appeals court in Riyadh ruled that the female employee was entitled to compensation after she was arbitrarily fired for her absence from work, which was due to the company’s failure to pay her salary for two months, according to Okaz newspaper.

Details of the Compensation Award

The compensation covers damages for the legal notification period, her leave balance, and her end-of-service gratuity. Additionally, the court ordered the company to provide the ex-employee with a certificate of experience in accordance with Saudi labour law. The ruling is final.

Impact on Expatriate Workers in Saudi Arabia

Statistics on Labor Lawsuits in the Kingdom

Saudi Arabia is home to a large community of expatriate workers. In the first quarter of the year, a total of 31,655 labor lawsuits were filed in the Kingdom, according to official figures.

Riyadh accounted for the largest share of these cases with 10,000 suits, followed by Mecca with 7,700, and the Eastern Province with 4,590.

Mechanisms for Dispute Resolution

Saudi Arabia has introduced a mechanism to facilitate the amicable settlement of disputes between employees and employers, aiming to ensure stable relationships between contractual parties.

Efforts to reach a friendly settlement are the first phase in handling labour disputes, during which mediation is used to bring the parties closer together in hopes of reaching a mutually acceptable compromise. If no agreement is reached, the suit is referred to a labor court within 21 days of the first settlement session.