According to our employment agreement template, when is salary due in Saudi Arabia?

Salary due dates are not specified in the employment agreement template for Saudi Arabia.

What date does the law specify salary must be paid in Saudi Arabia?

In Saudi Arabia, there is no specific date required by law for salary payments. However, it is mandated that salaries must be paid by the end of each month.

How is salary calculated and what components does it consist of in Saudi Arabia?

In Saudi Arabia, salary calculations typically follow a standard breakdown, although no specific law mandates the exact percentages. The common salary structure consists of:

• 65% basic salary
• 25% housing allowance
• 10% transportation allowance

However, the General Organization for Social Insurance (GOSI), which oversees social insurance contributions, calculates contributions based on the basic salary and the housing allowance. It is important to note that the housing allowance should not be less than 20% of the basic salary.

Is there a legal obligation to pay salaries in the same month in Saudi Arabia?

Yes, there is a legal obligation to pay salaries in the same month in Saudi Arabia. If the salary is not paid in the same month, the supported employee must agree to this in writing.

How many salary payments are made per year in Saudi Arabia?

There are 12 salary payments per year.

Should the employment agreement specify salary in monthly or annual amounts in Saudi Arabia?

In Saudi Arabia, employment agreements typically specify the salary on a monthly basis. The monthly salary generally includes several components:

• Basic Salary
• Housing Allowance, which is usually 25% of the basic salary or provided as company accommodation
• Transportation Allowance, commonly 10% of the basic salary

These components are often itemized within the employment agreement or offer letter. It is important that the total monthly compensation is clearly stated.

What tax and social security obligations do employees have in Saudi Arabia?

In Saudi Arabia, tax and social security obligations involve contributions to the General Organization for Social Insurance (GOSI). For Saudi nationals, the total GOSI contribution is 21.50%, which includes:

• Employee's Contribution:

- Unemployment Contribution: 0.75%

- Retirement Contribution: 9%

- Total Employee’s Contribution: 9.75%

It is important to note that there is no GOSI fee for expatriate employees in Saudi Arabia. GOSI contributions are applicable on the Basic Salary and Housing Allowance.

What are the details of the customary bonuses, including the 13th or 14th-month salary, and when are these payments typically made?

In Saudi Arabia, it is not mandatory for employers to provide bonus payments to employees. This includes any customary bonuses, such as a 13th or 14th-month salary.

What is the minimum wage information in Saudi Arabia?

As of now, Saudi Arabia does not have a nationwide minimum wage for private sector employees. However, specific guidelines exist for certain sectors and categories, particularly under Saudization programs, where some professions may have defined minimum wage requirements.