Annual Performance Report

What an annual performance report is

An annual performance report (تقرير الأداء السنوي) is a report that an establishment prepares on each worker’s performance at least once a year, on forms the establishment sets. The basis is Articles 18, 19 and 20 of the model work regulation (النموذج الموحد للائحة تنظيم العمل), which is Annex 1 to the Implementing Regulation (اللائحة التنفيذية) of the Saudi Labor Law (نظام العمل).

The Arabic text speaks of periodic reports on performance (تقارير عن الأداء بصفة دورية). It does not use the Arabic word for annual, and it does not use the noun for appraisal (تقييم). Only the verb «يُقيَّم» (is assessed) appears, in Article 19 of the model work regulation. The yearly rhythm comes from the phrase «مرة كل سنة على الأقل» (at least once a year) in Article 18 of the model work regulation, so annual describes the rhythm and is not a name used in the text.

What Articles 18, 19 and 20 of the model work regulation say

Article 18 of the model work regulation requires the establishment to prepare periodic performance reports for all workers, at least once a year, on forms the establishment sets. Each report must cover three elements:

• Competence. The ability to do the work and the degree of skill in it.
• Conduct. The worker’s conduct and the extent of the worker’s cooperation with superiors, colleagues and the establishment’s customers.
• Attendance (المواظبة). The Article names this element and does not describe it.

The Arabic text of Article 19 of the model work regulation is:

يُقيَّم أداء العامل في التقرير بالتقديرات التي تحددها المنشأة؛ على أن يتبع في ذلك مقياس من خمسة مستويات.

The English rendering is ours, not an official translation. The worker’s performance is assessed in the report by the ratings the establishment sets, and a scale of five levels must be followed.

Article 20 of the model work regulation provides that the worker’s direct superior prepares the report and that the holder of authority (صاحب الصلاحية) approves it. The worker is notified with a copy of the report immediately on approval and may submit a grievance against it under the grievance rules set out in the regulation.

The model work regulation is not part of the Labor Law. It binds an establishment to the extent that the establishment adopted it in its work organisation regulation (لائحة تنظيم العمل). Its Article numbers are also used in other instruments. Article 18 of the Implementing Regulation proper, for example, deals with work contracts, including the approval of the unified contract models. Each Article below is cited with its instrument.

What the establishment decides in the assessment

Article 19 of the model work regulation requires a scale of five levels and says nothing more about how to assess. The ratings, including the names of the five levels, are for the establishment to set. The graphic rating scale is one method an establishment may choose. It is covered under graphic rating scale, and the model work regulation does not mention it.

In the Articles we read, we found no text on the following points:

• Method. A required method of assessment, such as ranking or paired comparison.
• Distribution. A share of workers for each level.
• The reporting year. Whether the report covers the calendar year or each worker’s year of joining, and in which month it is issued.
• Time limits. Any limit for preparing the report, apart from the notification immediately on approval.
• The worker’s part. Whether the worker signs for the copy or comments on the report.
• Amendment. Whether the report may be amended after approval if an error is proved.
• Omission. What follows when an establishment does not prepare the reports, including the effect on the conditions for the raise and the promotion.
• Coverage. Whether the requirement to cover all workers extends to workers on probation and part time workers. The text excludes no one and does not clarify the scope.

Because we found no text on a share of workers for each level, we say neither that the model work regulation imposes a forced distribution nor that it forbids one.

How the report is prepared, approved and notified

Article 20 of the model work regulation gives the report three steps:

• Preparation. The worker’s direct superior prepares the report, not the human resources department and not the worker.
• Approval. The holder of authority (صاحب الصلاحية) approves it. The model work regulation uses that term, and in the Articles we read we found no definition of it.
• Notification. The worker is notified with a copy of the report immediately on approval.

The Arabic wording of the notification is «بصورة من التقرير» (with a copy of the report). Our reading is that the worker receives the contents of the report, not just a notice that the report exists.

What links to the report in the model work regulation

The periodic report becomes a criterion in two places in the model work regulation:

• The raise. Paragraph 1 of Article 21 of the model work regulation says that an establishment may grant annual raises (العلاوات) and that the percentage is set by reference to the establishment’s financial position. Paragraph 2 of that Article makes a worker eligible for a raise (مؤهلاً لاستحقاق العلاوة) after a full year from joining or from the previous raise, once the worker has at least an average level in the periodic report on the establishment’s form. Paragraph 3 lets management grant an exceptional raise under controls it sets, so the report is not the only route to a raise. Article 21 of the model work regulation is not Article 21 of the Implementing Regulation proper, which deals with forced labour. Annual raises are also covered under annual increment.
• Promotion. Item (ب) of Article 22 of the model work regulation makes a worker eligible for promotion to a higher post when four conditions are met: (1) a higher post is vacant; (2) the worker has the qualifications for that post; (3) the worker obtained at least an above average level in the last periodic report; and (4) the holder of authority approves. Article 23 of the model work regulation provides that when more than one worker meets the conditions, preference begins with nomination by the holder of authority, followed by the worker with the higher rating. Paragraph 5 of item (ب) of Article 22 of the model work regulation lets management grant an exceptional promotion under controls it sets, so the report is not the only route to promotion either. Article 22 of the model work regulation is not Article 22 of the Implementing Regulation proper.

The levels that count as average and above average depend on the names the establishment gives its five levels, because the text does not name them.

Eligibility for the raise is not an automatic entitlement. Paragraph 1 of Article 21 of the model work regulation makes raises optional, and paragraph 2 of that Article sets only the condition for eligibility. A worker who meets the condition is not owed a raise if the establishment has not decided to grant raises.

A worked example: a worker assessed after a year

A female worker joined an establishment on 1 March 2025. The establishment’s scale has five levels, named for this example weak, below average, average, above average and excellent. The figures are illustrative.

• The first report. In March 2026 her direct superior prepares her first report and rates her at the average level. The holder of authority approves it, and she is notified with a copy immediately on approval.
• The raise. A full year has passed since she joined, and average is the minimum level that Article 21 of the model work regulation requires, so she is eligible for a raise. Suppose the establishment decides to grant raises for the year and sets the percentage at 3%, and her basic wage is SAR 8,000. The raise is then SAR 240, which is 8,000 × 3%. The Article makes the percentage depend on the establishment’s financial position.
• Promotion. The average level is lower than above average, so her report does not meet condition (3) of item (ب) of Article 22 of the model work regulation. The other three conditions are assessed separately.
• The grievance. If she thinks the report is unfair, she may submit a grievance, as described below.

The grievance against the report

Article 20 of the model work regulation allows a grievance under the grievance rules in the regulation and does not name an Article. Those rules are in Article 71 of the model work regulation, which covers any act, measure or penalty taken against the worker (أي تصرف أو إجراء أو جزاء). Our reading is that a report falls within that wording, because Article 20 of the model work regulation points to the grievance rules and Article 71 of the model work regulation is the Article that contains them.

Paragraph 1 of Article 71 of the model work regulation lets the worker submit a grievance in writing to the competent body in the establishment within thirty days, excluding official holidays, from the date of being notified of the decision or measure complained of. The worker may not be prejudiced for submitting it, and the worker is notified of the outcome within fifteen days at most, excluding official holidays, from the date of submission. Paragraph 2 of Article 71 of the model work regulation gives the worker the right to object before the labour courts within thirty days, excluding official holidays, from the rejection of the grievance or the end of the period for deciding it, whichever is earlier.

Article 71 of the model work regulation is not Article 71 of the Labor Law, which deals with what must happen before a disciplinary penalty is imposed. The procedure is covered under grievance.

Arrangements that differ from the report

• Performance standards. They are written descriptions of what counts as acceptable in a job, covered under performance standards. The report applies a scale to the performance of a particular worker.
• 360 degree appraisal. It is a method of gathering the views of several parties, covered under 360 degree appraisal. Article 20 of the model work regulation has the report prepared by the worker’s direct superior, and nothing in it prevents the establishment from using other views to gather information.
• A performance improvement plan. It is a tool for addressing performance below what is required, covered under performance improvement plan. The three Articles do not mention it.
• A disciplinary penalty. It is based on a violation and on the procedures that precede it, and the penalty Articles of the model work regulation and the Labor Law govern it. The performance report is not a penalty, and the three Articles do not make it the basis of one.
• Calibration of assessments. It is a review of the consistency of assessments between managers, covered under performance calibration. It is not in the model work regulation.

Rating errors in preparing the report

The model work regulation does not mention rating errors. The following can distort the level on which the raise and the promotion depend:

• Central tendency. The rater places workers at the middle level, as covered under central tendency error. Here the effect is that workers cluster at a level that may be the minimum for eligibility for the raise under Article 21 of the model work regulation, depending on how the establishment names its levels.
• Recency. The rating is dominated by what happened in the final weeks of the year.
• Differences between managers. One manager gives a high level and another gives a low level to workers whose performance is close.

The model work regulation does not address these errors, so how to guard against them is for the establishment to decide.

What to document

These are practical recommendations, not conditions found in the Articles:

• A written form. Have the form carry the three elements in Article 18 of the model work regulation, and define its five levels by written descriptions.
• The approval date and the notification date. Record both dates, so that the worker and the establishment can see from them when the period for a grievance begins.
• The copy handed over. Have the worker sign for receipt of a copy of the report.
• The link to the raise and the promotion. Write the five levels by name in the establishment’s regulation, stating which is average and which is above average, so that this is not decided afresh in each cycle.
• Keeping the report. Keep it in the worker’s file. What an employee file holds is covered under employee file.

This is an explanation of the concept and of the statutory provisions cited, not legal advice.