Work Contract Legal Advice

Given the scenario, there are several labor laws within Saudi Arabia that may apply to your situation.

As per Saudi Labor Law pursuant to Royal Decree No. M/51 dated 23 Shaban 1426 H, as amended by Royal Decree No. M/24 dated 12 Rabi' I, 1434 H:

1. **Article 37:**

The contract of work must be written out.

2. **Article 38:**

Every contract must contain the agreed wage between both parties.

3. **Article 41:**

The contract may be renewed for a similar term or for a specific term.

If your employer gave a formal letter signed by a director and provided it to you in 'good faith' stating that your employment would be extended for an additional two years, this intent should ideally meet the criteria for a binding arrangement under Saudi Labor Law, whether it may be regarded as an official employment contract or not.

In reference to **Article 74**:

If there is no written contract or its term has expired while both parties continue to implement its terms, it shall continue to be effective until ended by one of the two contracting parties, except for contracts requiring specific arrangements which become exhausted upon the expiry of their periods.

In your case, the employer has only exhausted one year out of the additional two mentioned in the letter. Therefore, if the terms of the initial contract are still being followed, they are obliged to honor your existing contract for the rest of the duration as promised in the letter.

Saudi Labor Law also protects employees from arbitrary dismissal and provides remedies under such circumstances. Specific to this, under **Article 77 and 78**, if the worker is awarded an arbitrary dismissal, he has the right to demand compensation from the Commission for his service but it should not be less than two months' wages for every year of employment.

While dealing with such matters, please be cautious and consult directly with a lawyer or legal authority in KSA to obtain the most precise advice for your distinct circumstances. Although these are the outlined protections offered to workers under Saudi Labor Law, personal circumstances may differ, and in such a case, professional legal advice should be sought.