RIYADH — The Shoura Council rejected on Monday the proposal to introduce pay scale for Saudi employees working in various professions and trades in the private sector. A total of 65 members of the Council voted against the proposal, which was moved by Dr. Fahd Bin Juma with the backing of the Ministry of Human Resources and Social Development, while 59 members supported it. The decision was taken during a virtual session, chaired by the Council President Sheikh Abdullah Al-Sheikh. The committee for Social Affairs, Family and Youth justified the rejection by stating that the Nitaqat Saudization program of the ministry stipulates a minimum wage of SR3,000 for citizens in the private sector. The ministry is currently studying with the relevant authorities and the private sector to make amendments in the minimum salary to raise it to SR4,000 in a manner that is not in contravention of the international agreements signed by the Kingdom. During the Council session, the committee emphasized that approving the salary scales for the private sector employees is neither in the interest of the labor market nor in the interest of competitiveness either for the employer or the worker. The committee is of the view that some employers might take advantage of such a scale for denying higher salaries to those employees who make outstanding performance proving their high degree of competencies and capabilities. The salaries that are less than they deserve will kill their competitiveness in the private sector, which is based on the concept of supply and demand. The committee also noted the fact that the functioning and internal mechanism of companies differ from one another in accordance with the sectors and their growth rates. The pay scale adversely affects the dynamic functioning of companies because some sectors depend on the payment of various types of incentives apart from salaries. In the event of the introduction of a pay scale, these companies and sectors will have to discontinue the incentives and thus will be unable to retain their employees. Similarly, start-up companies will not be able to implement the pay scale and thus will be detrimental to the labor market stability. It is also noted that the current contract system is an appropriate one. Setting a limit for salary is not commensurate with the development and steady growth of the labor market in the future since most developed countries adopt an open labor market and are satisfied with setting a minimum wage, which is vital to protect interests of both parties. Moreover, it is to be noted that the ministry has halted its pilot project to fix salary scales because of the divergence of sectors operating in the market and the multiplicity of their systems.