Saudi Arabia – Recent Changes to Work Visas, Block Visas and Nitaqat

What has changed

The Ministry of Labour and Social Development (MLSD) has recently made several significant changes to its rules for issuing block visas and work visas, and to the “Nitaqat” Saudization system.

The MLSD reversed the October 2017 decision to reduce the validity period of block visas from two (2) years to one (1) year. Effective immediately, employers once again have two (2) years to complete the consular process to hire an employee from abroad.

Who is affected

Clients who have hired or intend to employ foreign nationals in Saudi Arabia.

What to expect

Nitaqat:

Employee onboarding or releasing will now take immediate effect on a company’s Nitaqat rating. Previously, it took twenty-six (26) weeks for employee onboarding to have a positive or negative effect on a company’s Nitaqat rating. The more extended waiting period was beneficial for larger establishments. However, smaller establishments who had to increase their ratings had to wait longer for their rating to increase and to receive their block visas. The updates are valid for companies which are in the platinum and green Nitaqat classifications, and for the last thirteen (13) weeks have maintained at least a green Nitaqat rating.

The Saudization system (Nitaqat) is complex, with companies grouped by industry sector and company size, then ranked into six (6) categories (Premium, High Green, Medium Green, Low Green, Yellow, and Red) of Saudization – the percentage of the company’s workforce that must consist of local workers.

Block Visas:

Block visas are used as the primary basis by which qualifying companies bring foreign workers to the country. Under the scheme, employers receive a pre-approved “block” of visas to hire foreign workers. With these recent changes, employers will now have just one (1) year for each block visa in which to recruit and hire workers and then apply for work visas at the Saudi overseas consular posts in the home country of the workers. Block visas are available to companies rated platinum or green in the Nitaqat system.

A new “compensatory” or “replacement” block visa scheme has been launched, allowing qualifying employers in the platinum and green (high, medium and low) Nitaqat categories to replace an employee within six (6) months of them leaving the country. However, the visa cannot be granted if it will push the company’s Nitaqat rating to yellow. Additionally, all legal licenses must be valid at the time of claiming the compensatory visa through the Ministry of Labour.

Work Visas:
The MLSD has also announced that it will issue new work visas for foreign nationals working in the private sector for two (2) years instead of one (1), without additional fees. If the visa requirements are still valid, employers can cancel old visas and apply for new visas. In 2017, the MLSD reduced work visa duration from two (2) years to one (1) year for all except domestic and government workers.

What you need to do

Contact your Emigra Worldwide representative for further details on how these updates may impact you or your client.

This alert was prepared with information provided by Newland Chase.