Saudi employers now have until 30 June 2026 to reach a 90% contract-documentation rate on Qiwa, up from an 85% threshold that took effect two months earlier. That single deadline is a useful way to understand where Saudi labour law actually stands right now: the headline reform landed back in 2024, but 2026 is when specific, dated, enforceable requirements are arriving one after another.
The pillar covering this reform sets out the scale of what’s changing. This piece goes further, walking through what each specific change actually requires: how the Qiwa mandate works in practice, what’s genuinely different for non-Saudi employment contracts, what the new anti-discrimination protections cover, what’s changed around leave and resignation, and how enforcement has sharpened since the core law took effect.
This is about the labour law itself. Saudization and Nitaqat, the other major compliance shift running in parallel, is covered in full separately.
Explore: Saudi Labour Law & Nitaqat Changes 2026: What They Mean for HR Professionals and Employers
Digital Contracts: What “Mandatory Qiwa Registration” Actually Means
The rule itself is simple: an employment contract isn’t legally recognised in Saudi Arabia unless it’s documented through Qiwa. What’s changed recently is how strictly that rule is being enforced. The Saudi Press Agency reported, independently confirmed by KPMG:
- 85% documentation rate required from 30 April 2026
- 90% documentation rate required from 30 June 2026
- Compliance is calculated by comparing documented contracts against an establishment’s total contract count, a figure employers can check for themselves
Falling short isn’t a paperwork inconvenience. MHRSD has been explicit that non-compliance can lead to restrictions or delays across services that depend on it, work permits, visa issuance, and Saudization standing alike.
The practical fix: pull a current documentation rate for every establishment, identify missing or incomplete contracts, and close the gap before the June deadline rather than after.
Non-Saudi Employees: The End of Indefinite Contracts
Article 37 of the Labour Law requires non-Saudi employment contracts to be written and for a specified term. That rule itself isn’t new. What’s changed is what happens when a contract doesn’t specify one:
- Before: an undated contract defaulted to the duration of the employee’s work permit
- Now: per Addleshaw Goddard, it defaults to one year from the employee’s start date instead
HR teams tracking contract expiry against Iqama renewal dates need to check whether that old link still applies to contracts signed or renewed after the amendment.
The conversion rule for renewals stays intact for everyone else: a fixed-term contract renewed three consecutive times, or reaching four years including renewals, whichever comes first, converts to indefinite if both parties keep working under it. For non-Saudi employees specifically, that conversion doesn’t happen, the contract stays fixed-term regardless of renewal count.
The practical check: review non-Saudi contracts for how duration is defined, and confirm renewal tracking reflects the one-year default where no term is stated.
New Anti-Discrimination Protections
Saudi labour law didn’t previously contain explicit anti-discrimination provisions in this form. Chambers and Partners confirms the amended law now prohibits discrimination or favouritism across hiring and employment decisions based on:
- Race and colour
- Gender
- Age
- Disability
- Marital status
For HR teams, the practical question isn’t whether discrimination was already frowned upon, informally, it likely was, it’s whether policy language and hiring practices now explicitly reflect these specific categories, or whether they still rely on general fairness language that predates this amendment.
The practical check: review job descriptions, hiring criteria, and promotion policies for language that could disadvantage anyone based on the categories above, even unintentionally, and name these protections explicitly rather than leaving them implied.
Leave, Resignation, and Grievance Changes
Several changes here are easy to miss individually but add up to a meaningfully different set of employee rights. Resignation is now formally recognised as a lawful reason for ending employment, something Addleshaw Goddard notes hadn’t been explicitly set out in KSA labour law before this amendment:
- Resignation timing. A written resignation request takes effect after 30 days if the employer doesn’t respond. An employer can delay accepting it for up to 60 days for valid business reasons, but only if they notify the employee in writing before that initial 30-day window closes.
- Notice periods. Ending an indefinite contract now requires 30 days’ notice from the employee, or 60 days’ notice from the employer.
- Disciplinary objections. The window to object to disciplinary action has been extended from 15 days to 30 days, with a further 30 days to file a labour court claim if the employer doesn’t respond.
- Leave entitlements. DLA Piper and Paul Hastings both confirm maternity leave increased to 12 weeks, and bereavement leave extended to cover the death of a sibling for the first time.
None of these require a large policy overhaul individually, but an employee handbook written before these amendments took effect is very likely already out of date on more than one of them.
Enforcement Has Changed Even More Than the Law
The core law was approved back in 2024. What’s genuinely new for 2026 is how seriously it’s now being enforced. In February 2026, MHRSD published an updated Table of Labour Law Violations and Penalties (Decision No. 112377):
- Bird & Bird describes it as the actual checklist inspectors use during inspections, reclassified into activity-based categories
- Gulf News reports at least some penalties, including Saudization quota violations, now scale by employer size: 8,000 SAR (Category A) down to 4,000 SAR (Category B) and 2,000 SAR (Category C)
- MHRSD confirms new dedicated categories for maritime and agricultural work, sectors the previous schedule didn’t cover in the same detail
- A settlement mechanism allows employers to resolve a first-time violation at up to an 80% reduction, provided it’s corrected and reported within 90 days
That last point is the real incentive: there’s a genuine difference between catching an issue proactively and having it found during an inspection.
What HR Should Check Right Now
Everything above points to the same conclusion: this isn’t a reform to read about once and file away. Here’s what to actually check:
- Qiwa documentation rate. Confirm your establishment’s current rate against the 85% threshold (already in effect) and the 90% threshold landing 30 June 2026.
- Non-Saudi contract terms. Review contracts without a specified duration for whether the one-year default applies, and check renewal tracking accounts for it correctly.
- Discrimination policy language. Confirm hiring, promotion, and treatment policies explicitly name the protected categories, rather than relying on general fairness language.
- Leave and disciplinary documentation. Update employee handbooks to reflect the new resignation timing, notice periods, disciplinary objection window, and extended leave entitlements.
- Penalty exposure. Know which violation categories apply to your sector and establishment size, and use the 90-day settlement window if something’s already off.
None of this needs to happen all at once, but it does need to happen before an inspection, a grievance, or a renewal deadline forces the question.
How Avado Can Help
Keeping up with this level of regulatory detail is exactly the kind of ongoing challenge formal HR qualification is built to prepare people for, not a one-time reading exercise, but the judgement to know what’s changed, what it actually requires, and what to check next. Avado already supports HR professionals across Saudi Arabia and the wider Middle East with CIPD qualifications built around exactly this kind of regulatory complexity, backed by HRDF funding and tutors who understand the local landscape.
Explore Avado’s CIPD Courses for Saudi Arabia and the Middle East and build the qualification that keeps you ahead of changes like these!
