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SAUDI ARABIA: Weighted Nitaqat Introduced
September 29, 2016
As part of Vision 2030, Saudi Arabia has announced the implementation of “Weighted Nitaqat” (or Nitaqat Al- Mozoon) as an enhanced version of their Nitaqat program.
Initially, the Nitiqat program was intended to increase the number of Saudi Arabian nationals employed within the private sector. The Government of Saudi Arabia now aims to improve the quality of employment of Saudi nationals which will significantly improve the life standard of all common Saudi nationals contributing to the success of Vision 2030.
Weighted Nitiqat is due to be implemented on 12 Rabi Al-Awal (approximately corresponding to 11th December 2016). The enhanced Nitaqat system will be comprised of five factors according to which an employer’s compliance rating will be calculated:
- Total number of Saudi nationals employed in a company
- The average salary paid to Saudi nationals by a company (total amount paid in salaries divided by the number of Saudi employees)
- The percentage of Saudi female employees in a company (the number of female employees divided by the total number of employees)
- Retention of Saudi nationals within a company (the total number of years served by Saudi employees divided by the number of Saudi employees in a company)
- The percentage of Saudi nationals within the top 25% of highly paid employees (by taking 25% of highest paid employees and calculating percentage of Saudi employees within that number)
The new system will also divide the Nitaqat categories into the sub-categories Medium A, Medium B and Medium C which will differentiate the Nitaqat criteria across the program.
For more information and advice on how to plan your Saudisation ratios in advance in order to comply with Weighted Nitaqat, please contact us at [email protected].
