Employment legislation ensures equality between the rights of employers and employees. The most frequently talked about section in the Kingdom of Saudi Arabia is the Termination Article 77. This section states what compensation can be provided in cases where an employment contract has been terminated without a valid contract-based cause. It is necessary to understand the terms of this particular section by employers, HR managers, and employees. This section falls under the larger context of the Saudi Labor Law.

How Saudi Labour Law Covers Contract Termination

The Saudi Labour Law recognizes two kinds of contracts: indefinite and fixed-term contracts. The provision that comes into play whenever a contract is terminated illegally without any reason, and when the terms of compensation for termination have not been laid down in the contract agreement, is covered under Article 77. This article states that compensation for the termination of a contract depends on the kind of contract. In the case of indefinite contracts, compensation is usually done in accordance with the years of experience an employee holds.

Why Each Human Resources Application Should Be Labour Law Compliant

The modern workspaces depend on a Human Resources Application to make HR tasks automated. With an advanced HR application, employment contracts become easy to manage with secure storage of employee information, duration tracking, notices, and a record of termination processes.

An advanced HR software also enables organizations to calculate end-of-service benefits, document employment, and generate necessary reports. The automation makes HR decisions labour law compliant without human error, which enhances the relationship between employers and their employees.

Best Practices for Employer and Employee

In every termination of employment, employers need to ensure that there is a proper documentation and communication procedure. The employer should give written notice if necessary, make sure to keep proper employment records, and check any agreements made before terminating an employment contract. The employee, meanwhile, should have an understanding of the conditions of the employment contract and keep a copy of the relevant documents.

Labour laws could be revised from time to time, so consulting the latest guide or the services of a competent lawyer is highly recommended

FAQs

1. What is known as Termination Article 77?

This is a section of the Saudi Labour Law that deals with compensation in some circumstances of termination of an employment contract without valid grounds within the contract.

2. Is Article 77 applicable to all employment contracts?

Article 77 applies depending on the nature of the contract, and the employment contract includes provisions on termination compensation.

3. What is the purpose of a Human Resources Application?

It helps to manage the employees’ information, track contracts, perform automated computations and maintain documents.

For more information, you can visit our website https://www.ehr.sa/ or call us at 0966-559748933