Abdullah A. M. Al-Khodari Sons Co.(Al Khodari) is expecting compensation from the Saudi government for fees that resulted from labor reforms, Reuters has reported citing the company’s chief financial officer Kailash Sadangi.
Sadangi claimed that the labor ministry had already announced that they would “grant compensation for the work permit levy.”
The fines came from the government’s policy aimed at integrating more nationals into the private sector.
Under the rules, a fee of SAR 2,400 per foreigner can be imposed on companies where the expatriate employees outnumber nationals. The measures were seen as harsh by many large companies such as Al Khodari which employs more than 17,000 workers.
However, the government last year started to offer some compensation to companies slapped with such fines.
Higher labor costs led to a 57 percent drop in Al-Khodari's first-quarter profit which hit SAR 13.98 million, when compared to the same period last year.
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