Saudi Gazette report

RIYADH — The Ministry of Human Resources and Social Development revealed that 80 percent of recruitment companies and offices are non-compliant with regulations and lack comprehensive governance. This has negatively impacted relations with countries that send workers to the Kingdom, the ministry said while referring to the current status of recruitment offices.

The ministry said in reply to a comment on the draft "Rules for the Practice of Recruitment and the Provision of Labor Services," which it recently posted on Istitlaa public consultation platform, regarding the mandatory transformation of small businesses into companies. The ministry said that it conducted individual interviews with more than 170 recruitment office owners and CEOs regarding the mandatory transformation of small businesses into companies.

After reviewing international best practices and conducting workshops with office owners, a request was made to transform these offices into small companies. A total of 86 offices have been transformed into recruitment companies since 2022.The ministry said that it currently has more than 200 requests to convert small businesses.

Meanwhile, the recruitment office owners had objected to the mandatory conversion of small businesses into companies, which has led many to exit the market due to high capital requirements and bank guarantees. They emphasized that the presence of these offices has contributed to stability of market and prices.