Article 77 addresses termination that doesn't meet the Labor Law's requirements — without a valid reason, or without following the required notice and procedure. Where a termination is found to be arbitrary, the employee is generally entitled to compensation, separate from and in addition to any end-of-service gratuity owed.
Whether a specific termination qualifies as arbitrary usually depends on the reason given, whether it matches what actually happened, and whether the employer followed the contract's and the law's procedural requirements along the way.
Article 80 lists specific circumstances allowing an employer to end employment without notice or compensation — serious misconduct such as assault, disclosure of trade secrets, a criminal conviction involving dishonesty, or repeated violation of instructions after a documented warning, among others.
Because this article removes the employee's usual entitlements when it applies, employers relying on it need to be able to show the specific ground applies and was properly documented, and employees disputing a dismissal on this basis are often disputing exactly that — whether the conduct alleged actually meets the article's requirements.
Article 85 sets out the reduced entitlement scale for employees who resign voluntarily — no entitlement under two years of service, a third of the calculated amount for two to five years, two-thirds for five to ten years, and the full amount beyond ten years.
This is the same rule covered in more detail in our end-of-service benefits guide, and it's worth reading alongside this one if resignation timing is part of what you're weighing.
| Article | What it covers | Key effect |
|---|---|---|
| 77 | Arbitrary termination | Compensation owed if termination doesn't meet legal requirements |
| 80 | Dismissal without notice | Employer can end employment without notice/pay, but only on specific listed grounds |
| 85 | Resignation reduction scale | End-of-service pay is reduced on a sliding scale for voluntary resignation |
The standard probation period is 90 days, though it can be extended once by written agreement, generally up to a combined 180 days. During this period, either side can typically end the contract with fewer of the usual protections that apply afterward, which is why understanding exactly which side of the probation line a dismissal falls on often matters as much as the substantive reason given.
An employee can't be placed on probation more than once with the same employer for the same role, unless there's been a genuine gap in the employment relationship or a real change in job title and responsibilities — a distinction employers sometimes get wrong when trying to reset a probation period.
Standard working hours are capped at eight hours a day or forty-eight a week, reduced during Ramadan for Muslim employees, with defined rules around overtime pay for hours worked beyond this. Annual leave, sick leave (including the portion paid in full versus partially paid beyond a certain number of days), and other statutory leave categories are set by the Labor Law rather than left entirely to individual contracts.
Salary deductions are also tightly regulated — an employer generally can't deduct from wages beyond specific, limited circumstances and percentage caps, and unauthorized deductions are a common and legitimate basis for a wage complaint.
No — the article requires the specific circumstances it lists to genuinely apply and generally to be properly documented. Simply citing the article number doesn't make a dismissal valid if the facts don't support it.
They apply broadly under the Labor Law, though some categories of work (like domestic labor) sit under separate rules. We can confirm what applies to your specific employment contract.
Generally no, unless there's been a genuine gap in the employment relationship or the role and responsibilities have genuinely changed — this is a common point employers get wrong.
Deductions beyond the specific, limited circumstances and percentage caps the Labor Law allows — this is a legitimate and common basis for a wage complaint if it's happening to you.
Muslim employees generally see reduced working hours during Ramadan under the Labor Law — we can confirm exactly how this applies to your specific contract and role.
Expert Riyadh