Nitaqat Program

Introduction

Nitaqat is a program that encourages the entities to localize the jobs, and a Ministerial Resolution No. 4040 dated 12/10/1432 AH,  was issued by the Ministry of Labor -currently Ministry of Human Resources and Social Development- (the “Ministry”), where it was resolved to be effective thereof.

The program started by specifying a criterium for Saudization through classifying entities according to its activity and size into four categories which are: Red, Yellow, Green and Excellent. Where entities do enjoy within the Green and Excellent categories necessary facilitations for its support and growth.

Updates

A Ministerial Resolution No. 4687 dated 18/11/1432 AH was issued by the Ministry, that obliges each entity having nine employees or less to employ at least one Saudi employee and to register him in the Social Insurances.

Followed by Ministerial Resolution No. 4685 dated 03/12/1432 AH was issued by the Ministry, regulates the matter of counting a Saudi employee who works in a part-time job with the Saudization plan, clarifying that it is not possible to count the same employee in the Saudization plan of different entities.

A further subsequent Ministerial Resolution No. 61706 dated 03/01/1442 AH was issued by the Ministry, that specifies a conditional minimum monthly wage for a Saudi employee in order to count him within the Saudization plan.

Developed Nitaqat Program

Across other amendments that regulates the matter of encouraging localizing the jobs until the last update was issued by Minitrial Resolution No. 182495 dated 11/10/1442 AH form the Ministry, announcing the Developed Nitaqat Program that focuses on restructuring the program taking into consideration merging small and very small economic activities with other economic activities, and providing a solid three years’ localization plan, and enhancing the direct relationship between the number of employees and the localization percentage after being based on set and specific sizes.