RIYADH — The General Organization for Social Insurance (GOSI) has approved penalties for violating provisions of the labor law and insurance law against unemployment. GOSI has specified penalties related to violation of the unemployment insurance scheme (SANED) regulations announced by the government in the wake of the measures taken to mitigate the economic impact of the coronavirus pandemic situation. Under the scheme, GOSI will bear 60 percent of the wages of Saudi employees working in the private sector for a period of three months. Employers are entitled to apply for the GOSI financial compensation for those Saudi workers whose names are registered with the organization. The new GOSI rules are aimed at avoiding the situation of dispensing with the Saudi staff by benefiting from the financial compensation. The organization has endorsed a penalty of SR50,000 in fine for dispensing with the Saudi staff after the expiry of the period for disbursement of unemployment compensation. There will be a fine amounting to SR20,000 if it was found that the employer is disbursing wages for workers only after the expiry of the period of disbursement of GOSI compensation. GOSI has fixed fines amounting to SR10,000 for each one of the following violations: non-commitment to pay the outstanding wages of workers that is not included in the compensation; furnishing incorrect information about the wages; submission of incorrect information in pledges and declarations; furnishing of any incorrect information in any documents submitted to the organization, and failure in furnishing any of the data or documents requested by GOSI. The penalties will be doubled with the number of workers involved and repetition of the violation by the employer.
