HRSD Ministry seeks feedback on draft rules for recruitment activities, labor services

Saudi Ministry of Human Resources and Social Development (HRSD) invited public input on the draft of the rules for practicing recruitment activities and providing labor services on Istitlaa. HRSD invited the public to share opinions on the draft executive regulations until Feb. 9.

These rules aim to regulate the practice of recruitment activities, provide labor services, as well as supervisory and regulatory activities, along with the authorities exercised by the ministry over licensed entities.

These rules apply to all entities licensed to practice one or more recruitment activities mentioned in the draft or any other recruitment activities approved by the ministry.

The companies subject to these rules include those with large capital at SAR 100 million, medium-cap companies with SAR 50 million capital, in addition to other recruitment firms capitalized at SAR 20 million and SAR 5 million.

To seek a license the company must be a closed joint-stock firm with capital entirely owned by Saudi nationals. Foreign investors who meet the requirements for foreign investment outlined in these rules are exempt, subject to the provisions of the Companies Law, licensing requires meeting the minimum paid-up capital and the bank guarantee.

The ministry may oblige companies to provide insurance coverage for all risks related to technical, labor, and professional failures, in line with the nature, size, and diversity of their operations. The company is not allowed to operate if the remaining duration of the insurance is less than six months.

Competent agencies may request an increase in the bank guarantee based on specified ratios and controls when the company is engaged in licensed activities, under the following circumstances:

- When the licensee requests an increase in the number of permits they can utilize.

- Changes in market conditions.

- Based on the company's operational model.

- The licensee's performance according to performance indicators and minimum standards.

- Increased complaints, delays in recruitment, delays in contracts with clients, or a decline in the quality of services provided.

- Any other cases for which the minister issues a decision.