The Transfer-of-Services Clause in the Employment Contract: What Happens to the Contract When a Non-Saudi Worker Moves to a New Establishment
How the employment contract documents a non-Saudi worker's move between two establishments: consent, notice, the handover of entitlements, and the start of the new service.
Moving a non-Saudi worker from one establishment to another inside the Kingdom has become a routine step in the labor market, yet in many small and medium businesses it happens without the employment contract saying anything about it. The request is filed electronically, the work permit moves, and only later do the parties discover that no one fixed when the first service ended, who pays the entitlements for the period served, or how the new establishment proves the date the worker started with it.
The transfer-of-services clause is the part of the employment contract that fills this gap. The clause neither creates the right to move nor prevents it, because that is regulated by the Ministry of Human Resources and Social Development through its electronic services, but it records what the parties agreed about consent, notice and the settlement of entitlements, turning the move from an administrative event into a documented path that can be relied on in any disagreement.
This guide explains what happens to the contract on a move, what the clause records, who files the request on the Qiwa platform, and how the new employer documents the start of service. Template E-01, the fixed-term employment contract, includes certified wording for this clause, and template E-02, the indefinite employment contract, is its companion in an establishment that employs both Saudis and non-Saudis. This guide is general information and not legal advice on any specific case.
Get the Fixed-Term Employment Contract templateE-01What happens to the employment contract when the worker moves to a new establishment
A transfer of services does not mean the old contract passes unchanged to the new employer. In practice, the first employment relationship ends with the current establishment and a new relationship begins under a new contract with the receiving establishment, and the two are linked by an electronic transfer request that the ministry approves, after which the worker's data is updated and a new work permit is issued. Each side therefore needs one document that closes what came before the transfer and another that opens what comes after it.
The Contractual Relationship Improvement Initiative launched by the ministry distinguishes between two situations: the worker moving after the contract has expired, which is allowed without the employer's consent, and moving while the contract is still in force, which is conditional on observing a notice period and specific measures. The ministry also offers a service for transferring services from another employer that allows the move without the current employer's approval, subject to the regulations and conditions, with the current employer notified of the request. The length of the notice and the conditions of each situation should be checked against the official source at the time of the transfer, and the contract should not simply assume them.
- The contract expires, then the worker moves: the clearest case, and the current establishment still has to settle the entitlements for the period served.
- The move while the contract is in force: it requires notice and specific measures, and it raises the question of who ended the contract and how that affects entitlements.
- The move by agreement of all three parties: it gives the widest room to settle entitlements and the start date in writing.
What the transfer clause records: consent and notice
The first thing the clause establishes is that the move happens only with the worker's express consent. The electronic service itself is built on the worker accepting or rejecting the new employer's offer from their account on the Qiwa platform, and a good clause reflects this reality and rules out any reading that the establishment can move the worker elsewhere against their wishes. The second matter is notice: when the current employer is deemed to know of the move, and how the date of the last working day with it is calculated.
يقر الطرفان بأن انتقال العامل إلى صاحب عمل آخر يتم عبر طلب نقل الخدمات الإلكتروني المعتمد لدى الوزارة، وبموافقة العامل الصريحة على العرض الجديد، وبعد إشعار صاحب العمل الحالي وفق المدة والضوابط النظامية، ولا ينتج النقل أثره إلا من تاريخ اعتماده نظاماً.
The parties acknowledge that the Worker's move to another employer takes place through the electronic transfer-of-services request approved by the Ministry, with the Worker's express acceptance of the new offer and after notice to the current Employer in line with the statutory period and controls, and that the transfer takes effect only from the date it is officially approved.
A short illustrative wording. The full certified text of the transfer clause is in template E-01.
Notice that the clause does not state a number for the notice period. The reason is that the period is governed by the regulations and controls in force at the time of the transfer, and fixing a number in the contract may put it in conflict with the rules if they change, or may suggest that the establishment can lengthen the period at will. The safer course is for the clause to refer to the statutory period, and for the establishment to keep a dated copy of the platform notification.
Handing over entitlements and settling end of service for the period served
The worker's move does not erase what they earned with the first establishment. Wages up to the last working day, the unused leave balance and the end-of-service award are all rights that arose from the period served. Article 84 of the Labor Law provides that the award is half a month's wage for each of the first five years and a full month's wage for each year after that, with fractions of a year in proportion to the time actually served, calculated on the last wage including fixed allowances.
The harder question is whether a move during the contract at the worker's initiative is treated as a resignation. Article 85 sets reduced shares for a worker who resigns: nothing for under two years, one third from two to five years, two thirds for more than five and under ten years, and the full award at ten years or more. How each transfer is characterized needs a lawyer's review, which is why the clause should state how entitlements are resolved rather than leaving the matter to interpretation after a dispute arises.
عند نقل خدمات العامل، يسوّي صاحب العمل الحالي مستحقات العامل عن مدة خدمته لديه حتى تاريخ اعتماد النقل، بما فيها الأجر المستحق ورصيد الإجازات ومكافأة نهاية الخدمة وفق نظام العمل، ما لم يتفق الأطراف كتابةً على خلاف ذلك، ويُثبت ذلك في مخالصة موقعة.
On the transfer of the Worker's services, the current Employer shall settle the Worker's entitlements for the period served with it up to the date the transfer is approved, including wages due, the leave balance and the end-of-service award under the Labor Law, unless the parties agree otherwise in writing, and this shall be recorded in a signed settlement.
A short illustrative wording. The full certified text is in template E-01, and the settlement itself is documented in the final settlement.
- Calculate wages up to the last actual working day, not up to the date the request was filed.
- Document the leave balance and how it is settled before the transfer is approved.
- If the two establishments agree that the award moves with the worker, put it in a three-party agreement signed by the worker.
- Close the relationship with a signed settlement stating the amounts and the date of receipt.
Who files the transfer request on the Qiwa platform
Many employers assume the current establishment is the one that transfers the worker. In fact, according to the ministry's description of the service for transferring services from another employer, the new employer starts the request, because it is the one that submits the job offer through the Qiwa platform, followed by the worker's role and then notice to the current establishment. One of the conditions of the expatriate worker transfer service is that a contract has been submitted, which means the new contract is part of the request and not a later step.
- The new employer: submits the job offer and the contract to the worker through the Qiwa platform.
- The worker: logs in to their account on the platform and accepts or rejects the offer.
- The current employer: is notified of the request and settles the entitlements for the period served.
- The platform: verifies the requirements, and after approval the data is updated and the new work permit is issued.
Screen details and requirements may change, so this guide states no step count, fee or period, and they should be checked on the Qiwa platform and the ministry's website when filing. What matters for the contract is that each party knows its role: the new establishment submits a sound contract, the current establishment closes what it owes, and the worker consents in writing and electronically.
How the new employer documents the start of service
For the receiving establishment, the start date of service is not a formality. It is the date from which the new contract runs, from which leave and the end-of-service award with the new establishment are calculated, and on which any probation term rests. The new contract should therefore state the start date expressly and tie it to the date the transfer is approved, not to the date the offer was made.
- A new employment contract stating the start date, the contract term, the wage and allowances, documented on the Qiwa platform.
- A start-of-work record signed by the worker on their first actual day.
- A copy of the transfer approval notice and the new work permit in the worker's file.
- An acknowledgment by the worker that they received their entitlements from the previous establishment, or of the written agreement that they moved with them.
If the new establishment wants the worker to serve a probation period, Articles 53 and 54 of the Labor Law recognize probation only if it is stated expressly and in writing, with a maximum of one hundred and eighty days including any extension. Each non-Saudi worker who joins the establishment changes the make-up of its workforce, so it is wise to review the effect of the transfer on Saudization ratios in Nitaqat before approving it.
Common mistakes in documenting a transfer of services
Most transfer disputes do not arise from the electronic request itself but from what was not written around it. These are the most frequent mistakes in small and medium businesses:
- Relying on the worker's acceptance on the platform without any signed document fixing the last working day and the start date.
- Writing a requirement for the current employer's consent into the contract in terms that conflict with what the official services allow.
- Postponing the settlement of the end-of-service award until after the transfer without a written agreement.
- Writing a numerical notice period into the contract without checking the statutory period in force.
- Copying the worker's old contract at the new establishment instead of concluding a new contract with a correct start date.
Frequently asked questions
Does transferring a non-Saudi worker's services require the current employer's consent?
Not always. The ministry's services allow the move after the contract expires without the employer's consent, and the service for transferring services from another employer allows the move without its approval, subject to the regulations and conditions, with the employer notified. During the contract, the notice period and the specified measures must be observed.
Who files the transfer request in Qiwa?
The new employer starts the request by submitting a job offer through the Qiwa platform, then the worker accepts or rejects the offer from their account, the current employer is notified, and after approval the data is updated and the new work permit is issued.
Does the end-of-service award move with the worker to the new establishment?
As a rule, the award is a right that arose from service with the first establishment and is settled for the period served under Article 84, or Article 85 depending on how the move is characterized. Any agreement that it moves to the new establishment must be in writing and signed by all three parties, and should be reviewed with a lawyer before it is relied on.
Can a transferred worker be placed on probation?
Probation exists only if it is stated expressly and in writing in the new contract or its annex, with a maximum of one hundred and eighty days including any extension under Articles 53 and 54. Whether it suits a worker doing the same job is a matter to assess case by case.
Which template should I use to document the worker's move?
The new establishment uses template E-01, the fixed-term employment contract, to conclude the new contract with a correct start date and a certified transfer clause, with template E-02 as its companion for Saudi employees in the same establishment. The previous establishment closes the relationship with a final settlement.
This guide was prepared and reviewed by a lawyer licensed in the Kingdom. The content is general guidance, not legal advice; consult a licensed lawyer for your specific case. Where an Arabic and an English text exist, the Arabic text prevails.