The Kingdom of Saudi Arabia is an Arab country, reputed to be where Islam originated. It also has the two most holy mosques (Mecca and Medina) in the Islamic faith which are the primary destinations for Muslims all over the world to visit as part of their pilgrimage, also known as the ‘Haj’. Their economic wealth comes from their vast natural reserves of crude oil, and they remain the world’s main source for imports. The political temperatures in the country were recently set ablaze due to global condemnation of the Kingdom’s alleged involvement in the killing of a dissident journalist. Their government remains a monarchy with a strict, authoritarian style of government that is considered very harsh towards people who are considered to be non-compliant with its dictates. Saudi Arabia is also rich in cultural traditions as defined by its Islamic heritage. People are very religious and practice ancient traditions from centuries ago. The population speaks primarily Arabic and practices Islam.
Indefinite contracts are contracts made for more than 3 years. Fixed-term contracts convert into indefinite-term contracts upon their third renewal or if they are continued even after their expiry without explicit renewal. Foreign employees can only be employed under fixed-term contracts.
Indefinite-term contracts are terminated by the mutual consent of both the employee and employer or at the initiative of either party based on a legitimate reason, which must be stated in a written notice addressed to the other party.
From August 6, 2026, all indefinite-term contracts must be documented through the Qiwa platform to ensure legal enforceability.
For Saudi national employees, the Labor Law does not require the employment contract to be in writing. A contract is deemed to exist even if not written, in which case the employee alone may establish the contract and their entitlements arising from it by all methods of proof. Either party may at any time demand that the contract be put in writing.
For non-Saudi employees, the employment contract must be in writing and must be of a fixed term. If the contract does not specify a duration, the duration of the work permit is deemed to be the duration of the contract.
Regardless of the nationality of the employee, Arabic is the mandatory language for all written employment contracts. If the employer uses a foreign language alongside Arabic, the Arabic text shall prevail in all cases.
Where a written contract exists, it must be prepared in duplicate, with 1 copy retained by each party. The contract must primarily include the name and location of the employer, the name, nationality, and identification of the worker, the agreed wage, including benefits and allowances, the type and location of work, the date of commencement of employment, and the duration of the contract if it is of a fixed term.
Employers must authenticate employee contracts via the Qiwa Platform, from registering the contract, updating the details of professions, wages, and qualifications, to the end or termination of the contractual relationship.
Temporary work is defined as work considered by its nature to be part of the employer’s activities, requiring a specific period or relating to a specific job and ending with its completion. It must not exceed 90 days in either case. Temporary employment contracts that continue beyond 90 days will become indefinite-term employment contracts.
Temporary employees are not entitled to end-of-service benefits. According to the Labor Law, these employees are subject to provisions on duties and disciplinary rules, maximum working hours, daily and weekly rest intervals, overtime work, official holidays, safety rules, occupational health, work injuries, compensation, and whatever is decided by the Minister of Labor.
The Labor Law of the Kingdom of Saudi Arabia provides that an employment contract can designate the first 180 days of employment as a probationary period. The probationary period cannot be extended. The probationary period must be explicitly stated in the employment contract and include leave that does not count toward the duration of the probationary period.
An employee cannot be subject to more than 1 probationary period with the same employer in the same position or role. As an exception, the employee may be placed on another probationary period if it is for a different position or occupation, or at least 6 months have passed since the termination of the employee's relationship with the employer.
The employee and employer can terminate the employment contract without any notice period during probation. Such termination does not entitle the employee to payment of severance or damages.
The maximum working hours are generally 8 per day or 48 per week, except during the holy month of Ramadan. During Ramadan, Muslim employees' working hours 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 10 hours per day or 60 hours per week. Employees cannot be allowed to work for more than 5 hours continuously.
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:
First 30 Days – fully paid
Next 60 Days – 75% of the total wages
Next 30 Days – unpaid
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.
Under the Labor Law of Saudi Arabia, pregnant employees are entitled to 12 weeks of paid maternity leave, with at least 6 weeks of this leave to be taken after the birth of a child. The remaining 6 weeks of leave may be taken as the pregnant employee chooses, beginning as early as 4 weeks before the expected date of birth. If the remaining leave is less than 6 weeks due to a delay in the date of birth, the remaining period will be unpaid. The employee may extend the unpaid leave for 1 month in all cases.
If an employee's child is born sick or with specific needs that require continuous attention, the employee is entitled to an additional 1 month of paid leave beginning after the end of the maternity leave period, and the employee may extend an additional month of unpaid 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 the Kingdom of Saudi Arabia, male employees are entitled to a paid paternity leave of 3 days, which can be taken within 7 days of the child's birth. Employers have the right to request supporting documents.
According to the Kingdom of Saudi Arabia's Labor Law, during any probationary period, either the employer or employee has the right to terminate the employment contract without notice.
Parties to indefinite employment contracts that pay a monthly salary may terminate the contract for a legitimate reason as follows:
By the employee with 30 days' written notice to the employer before the termination date
By the employer with 60 days' written notice to the employee before the termination date
Parties to indefinite employment contracts that do not pay monthly salaries may terminate the contract for a legitimate reason with 30 days written notice to the other party before the termination date.
Employees employed under fixed-term contracts may resign by submitting a 30-day notice to their employer.
Upon termination of the employment relationship, the employer is required to pay the employee an end-of-service benefit (EOSB).
The EOSB is calculated as follows:
Half a month's wage for each year of service during the first 5 years
1 full month's wage for each year of service beyond 5 years
Partial years are calculated on a pro-rata basis
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 full final settlement, including the EOSB, must be paid within 1 week of the date the employment relationship ends, where the employer initiates termination or the contract expires, and within 2 weeks where the employee resigns.
