POPULATION
35.3m
CURRENCY
ر.س (SAR)
CAPITAL CITY
Riyadh
Saudi Arabia, officially the Kingdom of Saudi Arabia, is a country in the Middle East. Known for its stunning landscapes, diverse culture, and rich history, Saudi Arabia is a popular destination for tourism and cultural exploration. From the bustling streets of Riyadh to the serene landscapes of the Arabian Desert, Saudi Arabia offers a wealth of cultural and natural attractions.
Saudi Arabia's economy is largely based on oil production, with efforts underway to diversify the economy and promote sustainable development. The country's strategic location and abundant resources make it an important player in the region.
Disclaimer: This content is for informational purposes only. We do not guarantee the accuracy or completeness of this content. It is not legal advice and shall not be relied on as such.
The Labor Law of the Kingdom of Saudi Arabia does not require employment contracts to be written. An employment contract is any contract whereby a person commits to work for an employer and under their management or supervision for a wage. If made in writing, the employment contract must be in Arabic or bilingual for non-Saudi employees.
Written contracts must be made in duplicates, each for the employee and the employer. Any party can request a written contract at any time.
Verbal contracts are allowed, but the employee alone may establish the existence of such a contract and their entitlements arising therefrom. When the contract is not in writing, either party may demand that it be put in writing at any time.
In the Kingdom of Saudi Arabia, labor laws do not provide for implied contracts. When an employment contract is not concluded in writing, the employee alone is responsible for establishing its existence and their entitlements arising from it by all methods of proof. When the contract is not in writing, either party may demand at any time that it be put in writing.
The maximum number of working hours is generally eight hours per day or 48 hours per week, except for the holy month of Ramadan. During Ramadan, working hours for Muslim employees may not exceed 6 hours per day or 36 hours per week. Under exceptional circumstances, employees may be asked to work beyond normal hours, limited to ten hours per day or 60 hours per week. Employees cannot be allowed to work for more than 5 hours continuously.
According to a new regulation, given COVID-19, employers are allowed to reduce employees' salaries with a corresponding reduction in working hours. This reduction cannot exceed 40% of the normal salary. After these regulations cease to be in effect, employees must increase their salary to normal levels. Employers can dismiss employees if they cannot pay even the reduced salary. These regulations do not apply to companies that benefit from government subsidies.
National Public Holidays in Saudi Arabia are the following:
The Labor Law of the Kingdom of Saudi Arabia provides that an employment contract can designate the first 90 days of employment as a probationary period. Probationary period can be extended by an additional 90 days with the written agreement of both parties. Probationary period must be explicitly stated in the employment contract. An employee cannot be subject to more than one probationary period with the same employer in the same position or role.
Both the employee and employer have the right to terminate the employment contract without any notice period during probation. Such termination does not entitle the employee to payment of severance or damages.
According to the Kingdom of Saudi Arabia's Labor Law, either party may terminate indefinite-term contracts by providing at least 60 days written notice to the other party if the employee is paid monthly. If the employee is paid at a different frequency, at least 30 days' notice must be provided. Payment in lieu of notice is permitted if both parties agree to it.
Saudi Arabia's Labor Law provides for an end-of-service award due at the end of employment, regardless of the reason for termination (retirement, end of the fixed-term contract, force majeure, resignation, or redundancy). Such an award amounts to 15 days' wages for each of the first 5 years of service and one month's wages each year for the following years. This benefit is calculated based on the last drawn wage. Where employment is terminated due to an employee’s resignation, the amount of severance benefits decreases depending on the number of years of experience.
If a female employee resigns within 6 months of her marriage or 3 months of her delivery date, full severance is paid irrespective of her years of work experience.
The Kingdom of Saudi Arabia has a government-mandated minimum wage for all employees.
The monthly minimum wage for public-sector employees is SAR 4,000 (Saudi riyals). There is no private-sector minimum wage for foreign workers. The government's Nitaqaat (Saudization) program set a general minimum private-sector wage for citizens at SAR 4,000 per month. Part-time employees are also eligible for minimum wage.
Work done in excess of the standard working hours (eight hours per day) is considered overtime. Total working hours, including overtime, cannot exceed 10 hours daily. Overtime hours may not exceed 27 hours per year; however, they may be increased by the employee's consent.
Overtime is payable at 100% of the employee’s usual hourly wage, plus a bonus rate of 50% of basic pay. All work on Fridays and public holidays is considered overtime and paid at the same rate.
Annual leave is paid at the employee's normal wage rates.
Foreign nationals who wish to work in Saudi Arabia must obtain work visas sponsored by their employers. There are 3 types of work visas in Saudi Arabia: seasonal work visas, permanent work visas, and temporary work visas.
Temporary work visas are issued for up to 1 year but allow the visa holder to stay for a period limited to 90 days. This period can be extended only once for a period of another 90 days. Permanent work visas are granted to workers with long-term employment contracts while seasonal visas cannot exceed 4 months.
To obtain a work visa, the employer must prove that no Saudi citizen could fill the position. Employers must apply for a work visa to the Ministry of Human Resources and Social Development. After receiving authorization from the Ministry, a work visa is issued by the Ministry of Foreign Affairs. Documents to be submitted include the employment contract, proof of qualifications, medical certificate, letter of sponsorship from the employer, Zakat Certificate, Company Registration, etc.
In March 2021, the existing Saudi immigration regulations were amended as part of the Kingdom's Labor Reform Initiative. The reforms affect foreign workers in Saudi Arabia and aim to ease the strict "kafala" employer sponsorship system. The reforms allow foreign workers to change jobs by transferring their sponsorship from one employer to another and re-enter and exit the country without the consent of their employer.
Population 35.3m
Population in total, including all residents regardless of legal status © 2024 - WBG • EUROSTAT
85.2%
Urban Population
100%
Internet access
78.8%
Banking access
100%
Mobile phone access
Population: The World Bank: World Development Indicators: World Bank Group • World Population Prospects, United Nations (UN), uri: https://population.un.org/wpp/, publisher: UN Population Division; Statistical databases and publications from national statistical offices, National Statistical Offices, uri: https://unstats.un.org/home/nso_sites/, publisher: National Statistical Offices; Eurostat: Demographic Statistics, Eurostat (ESTAT), uri: https://ec.europa.eu/eurostat/data/database?node_code=earn_ses_monthly, publisher: Eurostat; Population and Vital Statistics Report (various years), United Nations (UN), uri: https://unstats.un.org, publisher: UN Statistics Division
Urban Population: The World Bank: World Development Indicators: World Bank Group • World Urbanization Prospects, United Nations (UN), uri: https://population.un.org/wup/, publisher: UN Population Division
Internet access: The World Bank: World Development Indicators: World Bank Group • World Telecommunication/ICT Indicators Database, ITU (ITU), uri: https://datahub.itu.int/
Banking access: The World Bank: World Development Indicators: World Bank Group • FINDEX, WBG (WB), uri: https://www.worldbank.org/en/publication/globalfindex
Mobile phone access: The World Bank: World Development Indicators: World Bank Group • World Telecommunication/ICT Indicators Database, ITU (ITU)
The minimum entitlement to paid annual leave is 21 days a year, increasing to 30 days a year after 5 years of service. The employer cannot forfeit the leave, nor can it be paid in lieu of leave. Employers decide the dates of the leave according to work requirements. They must inform their employees of the leave at least 30 days before.
The employee has the right to request that their employer defer their entire annual leave or part thereof to the next year. If required by work conditions, an employer may postpone an employee's leave for up to 90 days after the end of the year, which is due with the employee's written approval.
According to a new measure for mitigating the impact of COVID-19, the government has allowed employers to place employees on paid annual leave or unpaid leave (with the employee's agreement) to cope with a decrease in work.
According to the Kingdom of Saudi Arabia's Labor Law, the minimum entitlement to sick leave is 120 calendar days a year, implemented as follows:
Sick leave can be continuous or intermittent. An employer cannot terminate the worker's services on account of illness prior to allowing their sick leave. Sick leave may be combined with annual leave. If the sick leave days coincide with the annual leave days, the annual leave days are suspended until the end of the sick leave days. If weekly days off coincide with sick leave days, the worker may not be compensated for those days.
According to a Ministerial Decision by the Ministry of Health, in view of COVID-19, the following employees are entitled to a compulsory paid sick leave of two weeks:
A female worker is entitled to a minimum of 10 weeks' paid maternity leave, divided into 4 weeks before the expected delivery date and then 6 weeks following the child's birth.
Employees who have worked for at least 1 year with the employer are entitled to 50% of wages during maternity leave, and those who have worked for at least 3 years with the same employer are entitled to 100% of wages. Employees are not eligible for annual leave in the year they take maternity leave.
Employers are prohibited from dismissing or suspending an employee while she's on maternity leave or for 180 days before her maternity leave begins.
In view of COVID-19, the government has granted compulsory paid leave of two weeks to all pregnant employees.
In the Kingdom of Saudi Arabia, male employees are entitled to paid paternity leave of 3 days for their child's birth. Employers have the right to request supporting documents.
Insured employees are eligible for a retirement pension if they reach 60 years of age and have made at least 120 months of paid contributions. Early retirement may be taken at any age if the employee has made at least 300 monthly contributions.
The pension is 2.5% of the insured’s average monthly earnings during the last 2 years for each year of contributions after 2001. For contributions made before 2001, the pension is calculated as 2% of the average wage over the last 2 years per year of contributions. The maximum pension is 100% of the average salary. The minimum pension is SAR 1,983.75 (Saudi riyals) a month.
If the insured does not satisfy the qualifying conditions for an old-age pension, an old-age settlement is paid as a lump sum of 10% of the insured’s average monthly earnings during the last 2 years before retirement for each month of the first 60 months of contributions, plus 12% for each additional month of contribution for contributions made after 2001.
Survivors of a deceased employee are entitled to survivor benefits if the employee had paid contributions for at least three consecutive months/six non-consecutive months, was a pension recipient, or died due to work injury. If the deceased was no longer in covered employment and did not receive any pension, their survivors will be eligible for pension if the deceased had paid at least 120 monthly contributions.
If there are three or more survivors, they are entitled to 100% of the pension the deceased received or would have been entitled to receive; two survivors are entitled to 75% of the deceased employee's pension; one survivor will receive 50% of the pension. The pension is split equally among eligible survivors. An additional death grant is paid to survivors as a lump sum of three months' pension, divided equally among eligible survivors.
If the deceased employee did not fulfill the conditions for survivors' benefit, a lump sum is paid. It is calculated as 10% of the insured's average monthly earnings during the last two years before death for each month of the first five years of contributions, plus 12% for each additional month.
Insured employees who become permanently disabled before age 60 are entitled to a pension if they have at least 12 consecutive months or 18 non-consecutive contribution months (this amount is doubled for voluntarily insured persons who joined the scheme aged 50 or older). The disability must begin while the insured is in covered employment.
Pension is calculated as a percentage of the average wage per year of contributions. The average monthly earnings used in the calculation of benefits must not exceed 150% of the monthly earnings of the insured at the beginning of the last five-year contribution period. The pension is increased by 50% if the insured member needs others' assistance, provided that the allowance does not exceed the amount of SAR 3,500 (Saudi riyals). The maximum pension is 100% of the average salary. The pension amount cannot exceed 50% of the average monthly wage. The minimum pension is SAR 1,983.75 a month.
In the case of disability caused by an occupational hazard, employers must cover medical care expenses and provide monetary compensation (pension and lump-sum benefits), depending on the type and degree of disability.
The Labor Law of the Kingdom of Saudi Arabia prohibits the employment of children under the age of 15 and protects them from exploitation in work that is hazardous or harmful to their health. The Minister of Labor may allow the employment of children between 13 and 15 years of age in light work that is not harmful to their health or growth and does not hinder school attendance.
Children are only allowed to work for six hours per day, interspersed with rest breaks. Children cannot work for more than five hours consecutively or at night or in heavy or hazardous work. Minors cannot be made to work during weekly rest days, official holidays, or annual leave. As an exception, minors can be employed during the night in establishments where work is limited to family members, work in vocational schools and training centers, work in bakeries, or in force majeure and emergency cases.
Unemployment 3.9%
Share of the labor force that is unemployed, but available for and seeking employment © 2024 - WBG • ILO
63.8%
Labor force population share
19.7%
Female share of labor force
74%
Healthcare access
Unemployment: The World Bank: World Development Indicators: World Bank Group • ILO Modelled Estimates database (ILOEST), ILO (ILO), uri: https://ilostat.ilo.org/data/bulk/, publisher: ILOSTAT, type: external database, date accessed: January 07, 2025.
Labor force (total): The World Bank: World Development Indicators: World Bank Group • ILO (ILO), type: estimates based on external database; United Nations (UN), publisher: UN Population Division; Staff estimates, WBG (WB)
Labor force population share: The World Bank: World Development Indicators: World Bank Group • ILO Modelled Estimates database (ILOEST), ILO (ILO), uri: https://ilostat.ilo.org/data/bulk/, publisher: ILOSTAT, type: external database, date accessed: January 07, 2025
Female share of labor force: The World Bank: World Development Indicators: World Bank Group • ILO (ILO), type: estimates based on external database; United Nations (UN), publisher: UN Population Division; Staff estimates, WBG (WB)
Healthcare access: The World Bank: World Development Indicators: World Bank Group • GHO, WHO (WHO), uri: https://www.who.int/data/gho/data/themes/topics/service-coverage
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