Saudisation measures criticised by contractors

Ministry of Labour says it will look into decision to charge businesses annual fee for every expatriate worker in excess of Saudi workers

Saudi Arabia’s Ministry of Labour will address concerns raised by private businesses over fees being charged to companies with expatriate workers exceeding Saudi employees, the Minister of Labour said on Saturday.

Adel Fakeih said that his ministry would look to address the problems faced by businesses as a result of the ministry imposing an annual fee of SAR2,400 for every expatriate worker in excess of Saudi employees in the private sector.

Fakeih added that the ministry would look a ‘legitimate and reasonable concerns fairly’, a report in Arab News.

The minister’s comments come after Abdullah Al Mubti, president of the Council of Saudi Chambers, criticised the ministry’s decision.

“The ministry’s decision has caught us off-guard,” he said. “About 90% of workers in the contracting sector are foreign workers,” Al Mubti added, urging the ministry to encourage Saudi Arabians to work with contracting companies.

Raed Al Oqabli, deputy chairman of the Contractors Committee at Jeddah Chamber of Commerce and Industry, warned that the ministry’s decision could have a negative impact on the national economy.

“About 90% of the one million workers in the contracting sector are foreigners. This is because most Saudis are not willing to undertake jobs offered by contracting companies as they have to work under difficult conditions,” he explained to the newspaper.

“This decision is going to affect all contracting companies in the Kingdom as there is no company that has an equal number of Saudi workers to foreign workers.”

Al Oqabli added that the cost of employment would have an impact on the cost of the project, as contractors calculated the cost on the basis of expenditures. He estimated that the increase in project costs would be at 25% with the new ruling.

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