Khaled Khalawi Makkah daily Most people are unaware of the major features of labor contracts signed between employers and employees. Proper understanding of the provisions of the contract is useful for both parties to protect their interests in the best possible manner. There are two types of labor contracts: those for a specified period of time and those without any specific period. Contracts for unspecified periods can be terminated if one party wishes to do so and for this there is no need to secure the consent of the other party. However, a contract for a specified period cannot be terminated unless there is an agreement between the two parties. It is not possible to terminate the contract before completion of the period even if one party wishes to do so. A contract for an unspecified period will be terminated if the worker reaches 60 years of age in case of man and 55 years in case of a woman whereas the contract for a specified period will continue until the end of the period even if the worker crosses the above age limit. There are two situations in the case of specified contracts. 1) There should be a mention in the contract of a further automatic renewal (the period could be identical with the previous period). In such a case, the contract will be renewed automatically when its initial period expires unless there is an objection from the concerned parties. If the contract is renewed after the expiry of the second contract or the duration of both first and second contracts exceeds three years, then the contract is automatically converted into one that does not expire. 2) If there is no mention in the contract of an automatic renewal, the contract will end with the expiry of its initial period. The two parties can, however, agree to renew it. In such a case, the contract would also be automatically converted into one that does not expire. In order to terminate a contract which is for an unspecified period of time, the party which wants to end it should write a letter to the other party at least 30 days prior to the end of the contract. During the one-month notice period, the party should continue his routine work at the firm. If one of the parties violates the notice period, he/she has to pay that month's salary to the other party. When the party (worker) informs the other party that he/she is leaving the job, the other party (employer) shall accept it unless the employer is afraid of any justifiable situation that affects the firm adversely. In such case, the party (worker) shall consider this situation. If he is adamant in using his right to quit the job with a deliberate intention to harm the other party (employer), then the employer is entitled to demand compensation for the harm caused to him. It is not permissible for non-Saudis to enter into a contract for an unspecified period. As for Saudis, they can enter into contracts either for specific periods of time or an unspecified period.
