Expatriates working in Saudi Arabia are in an unenviable situation. All of us have fixed term contracts which we sign before taking up an assignment in the kingdom. We just assume that once the contract is extended, we have another term of stay in the kingdom.
I have mentioned in the past the importance of going through your contract terms and conditions very carefully before signing it. What protects you once you land here is only the contract and nothing else. Note that all the important things which matter to the expatriate, your job title, family visa, end of service benefits, virtually all of your benefits and obligations of your sponsor, are all based on your contract.
My attention was drawn to an interesting article in today's Arab News. This is a question by one of the readers to a lawyer about the status of his contract. The question relates to a "time bomb clause" in the contract by which the employer can terminate the contract at any point of time by giving a month's notice despite a contract to the contrary. The reply given by the lawyer is 100% correct and I have no reason to dispute it, given that the learned lawyer is a well-respected one in his profession. What I would like to focus in today's post is what is NOT mentioned in the reply.
For those of us expatriates who have continued to stay beyond the "initial" contract which was signed after entering the kingdom for the first time, you must be careful on what you sign while extending your contract. Clever employers use the word "extension of contract" rather than just "contract". Expatriates working in Saudi Arabia must be aware of their rights and obligations while extending their contract with the above words. What this means in simple language is explained below.
When you first arrive in the kingdom on a contract, this becomes the "mother" contract. Now let's say you signed a 2-year contract. At the end of the 2nd year, both you and your employer want to renew this for another 2 years, either on the same terms or on mutually agreed upon terms and conditions. In case the new contract says that it is an "extension of contract", your employer has every right to terminate you with just a simple one-month notice. All is not lost. You too have an equal right to terminate the contract with the same notice period. It doesn't matter if you have a 2-year contract extension. What this, in effect, means is that the employer is not obliged to give you your complete end of service benefits and other dues until the "end" of your contract, i.e., until the 2-year period in the renewed contract is completed. This is the difference between a "contract" and an "extension of contract".
For example, this is my 12th year of stay in the kingdom. After the "mother" contract of the first 2 years, the contract with my employer has always been an "extension of contract". My employer chose not to sign a fresh contract, but rather just "extend" the existing contract. Of course, it was by mutual consent. So, every two years I sign a contract extension for another 2 years. I am under no kind of illusion that I would stay in the kingdom for atleast 2 more years. Every day I come to work, I know that I have a notice period of 30 more days on either side, even though I have a 2-year contract. I am quite happy with this arrangement because I am not bound to work for the complete 2-year period in the extended contract and I can just quit if I get a better job by giving a month's notice, just as how my employer can also fire me by giving a month's notice. So, all is fair in love and war, as they say.
After all, the only thing certain in Saudi Arabia is uncertainty! Hope this post is an eye-opener for fellow expats.