JEDDAH: Companies that fail to meet Saudization targets within the allotted three months starting July 9 will be given a further two months' grace if the ministry deems them sufficiently committed to the required changes. The new program which puts private sector companies in four categories – red, yellow, green and “excellent” – to reward or penalize them for their rates of Saudization, was outlined by Adel Fakieh, Minister of Labor, at a meeting with the business community in Jeddah earlier this week. Fakieh said that while firms have three months from July 9 to adjust their rates of Saudization – now referred to as “nationalization” at the ministry – two further months of grace would be given to those whose progress in employing Saudi staff reflects positively on their commitment to the program. The ministry estimates 20 percent of companies will find themselves in the red zone once the system starts. “The extra two months are meant to enable companies to move on from the red category to the yellow one, as well as keep on with nationalization in order to move on from yellow to green during a set period,” the minister said. “That will qualify those companies for the privileges and benefits usually given to the companies in green. If they fail to improve their categories, however, they will be subject to the penalties as set out in the regulations, such as the non-renewal of work permits for their foreign staff.” He said the companies classified as green or excellent will have the benefit of being allowed to employ foreign staff straight from firms in the red or yellow categories. “That means they will be able to take on staff already trained, which will save them time and money. But I don't believe that those companies will be overly hasty in taking on foreign staff as it could be detrimental to their standing in the classification.” The system does not apply to all market sectors, and Fakieh said that exempted operations such as pharmacies, goldsmiths and jewelers could be joined by others if the ministry deems it a necessary and after “prolonged study”. He also warned others to whom the regulations do not apply — such as individuals with nine or fewer persons in their employment — that the ministry would not “fall for any tricks”. “Some may try and open several establishments at the same time to employ more foreigners, but the ministry has means of discovering such tricks,” he said. “Should any be discovered, offenders will be put into the color-coded system.”
