Termination Letter For Poor Performance Template for Saudi Arabia

When you need to terminate an employee in Saudi Arabia due to poor performance, you must follow strict legal procedures to ensure compliance with Saudi Labor Law. A Termination Letter For Poor Performance serves as the formal documentation that officially ends the employment relationship while protecting your organization from potential legal challenges. This document is not just a courtesy notification—it's a legal requirement that demonstrates you've followed proper termination procedures under Royal Decree No. M/51.

When do you need this document?

You need this letter when an employee consistently fails to meet performance standards despite receiving proper warnings and improvement opportunities. The document becomes necessary after you've documented performance issues, provided at least one written warning as required by Article 71 of Saudi Labor Law, and given the employee reasonable time to improve. You'll also need this letter when an employee's poor performance significantly impacts business operations, when they fail to achieve agreed-upon performance targets within specified timeframes, or when their work quality consistently falls below acceptable standards. The letter is essential before terminating any employee to ensure you have proper legal documentation and have followed all procedural requirements.

Key legal considerations

Under Saudi Labor Law, you cannot terminate an employee for poor performance without following specific procedures. Article 75 requires that termination be based on legitimate reasons, while Article 71 mandates at least one written warning before termination. Your letter must reference specific performance incidents with dates, previous warnings issued, and improvement opportunities provided. You must also consider whether the performance issues constitute grounds for termination with notice under normal circumstances or without notice under Article 80 for serious performance failures. The letter should clearly state the effective termination date, final settlement calculations, and any remaining obligations. Additionally, you need to ensure the employee receives proper notice or payment in lieu of notice unless the poor performance falls under serious misconduct provisions.

Legal requirements in Saudi Arabia

Saudi Labor Law imposes strict requirements for performance-based terminations that you must incorporate into your letter. Under Royal Decree No. M/51, you must demonstrate that the employee received proper performance feedback and improvement opportunities before termination. Article 85 governs notice period requirements, typically 30 days for employees with less than five years of service. Your letter must include the company's official letterhead, employee's full details including ID number, specific performance deficiencies with supporting documentation, and reference to previous warnings. You must also calculate and specify end-of-service benefits, accumulated vacation pay, and any other final settlements. The document should be signed by authorized company representatives and delivered to the employee with proper acknowledgment to ensure legal validity and enforceability.