Regulations for the Distinguished Competencies Clause: Conditions, Exempt Categories, and Disbursement Mechanism

In a strategic move aimed at enhancing the efficiency of the state's administrative apparatus, the relevant authorities in the Kingdom of Saudi Arabia recently approved the regulatory framework for the "Distinguished Performance" clause, representing a qualitative shift in the mechanisms for employee incentives within both the civil and military sectors. This decision replaces previous mechanisms, ensuring greater governance and transparency in the disbursement of rewards, in line with the objectives of the Kingdom's Vision 2030, which focuses on strengthening human capital and developing government performance.

Context of the shift towards governance and transparency

The adoption of these controls comes within the context of a comprehensive reform underway in the public sector. The decision stipulates the abolition of what was known as the “secret expenditure item” allocated for incentive purposes, replacing it with a “distinguished performance item.” This change is not merely a change in terminology, but a shift from traditional practices to a precise institutional system that links financial incentives to actual performance and excellence, thereby strengthening the principles of job fairness and eliminating unjustified disparities in rewards.

Eligibility criteria and evaluation mechanisms

The new regulations have established strict criteria to ensure that bonuses reach their rightful recipients. These criteria stipulate that employees must have received a performance evaluation of at least "good" or its equivalent in the most recent year. The regulations also require that the employee has completed a minimum of 180 days of service with the entity and that their employment relationship is active at the time the disbursement decision is issued. These regulations apply to all employees of the entities, both civilian and military, including those appointed on a wage basis and those contracted under the executive regulations for human resources.

The six categories excluded from the bonus

To ensure that financial resources are directed towards actual working competencies, Article 6 of the regulations specifies 6 categories excluded from receiving these bonuses, namely:

• The employee is blind.
• The employee who is on scholarship or sent on study leave.
• An employee seconded from one entity to another.
• An employee who is absent from work for more than 90 consecutive days during the year.
• Some categories of contractors have regulations that govern special mechanisms for rewards.
• Any other categories that the regulations stipulate are not to be included.

Financial allocations and disbursement procedures via the “Sarf” system

The regulations require government entities to allocate 3.5 million riyals in their budgets for this purpose, emphasizing that this bonus cannot be combined with any other incentives to ensure fairness. As part of the financial digital transformation, the decision mandates that bonuses be disbursed exclusively through the central financial entitlements system, "Sarf," thus facilitating oversight and financial auditing by the Ministry of Finance.

This new regulation is expected to contribute to creating a positive competitive work environment, where excellence and achievement become the basic standard for obtaining incentives, which will positively reflect on the quality of services provided to citizens and residents, and enhance the productivity of the public sector in general.