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There is a variety of religious-related leave entitlements in Saudi Arabia, Hajj Holidays.

Hajj is the annual Islamic pilgrimage among Muslim faithful held at the holy city of Mecca. If an employee joins they are allowed 10 days of paid vacation. However, they must have completed two years with the company first and can only take this leave once every five years.

Eid ul Fitr

Workers are allowed 4 days of paid vacations from 30th Ramadan for the Eid ul Fitr.

Eid ul Adha

Workers are allowed to have 4 days of paid vacations from 9th Zil Hajja for the Eid ul Adha.

Saudi Labor Law grants workers not less than 21 days paid annual vacation. It will become 30 days once a worker completes five consecutive years of service. In general employees should use vacation leave during the year it is due.

Marriage Leave

Employees are given 3 days of paid marriage leave. Marriage leave is separate to annual leave, e.g. if an employee takes two weeks of holiday leave to get married, 3 of those days will be deducted from Marriage Leave and the remaining from Annual Leave.

if an employee’s sickness has been proven (e.g. medical certificate), they are allowed up to four months sick leave from employer. Under these conditions the employer cannot terminate the employee during this time.

It is possible to connect sick leave with annual holiday benefit. The following lists down the quota which is implemented on yearly basis.

·                     First 30 days- Fully paid

·                     Next 60 days – 3/4 of total wages

·                     Next 30 days – Unpaid

Female workers are entitled to 10 weeks of leave to deliver a child, starting from 4 weeks before the delivery date and 6 weeks after. This leave can also be connected with Annual Leave if the worker chooses to. During the period of Maternity Leave, the company cannot terminate the worker.

Maternity Leaves pay is determined as such:

·                     Less than 1 year – Unpaid

·                     1 year – Half paid

·                     3 years or more – Fully paid

Male workers are entitled to one day of paid paternity leave to attend the birth of their newborn.

The employer must have a valid reason for terminating the employee. examples of valid reasons include employees still under probation, gross misconduct, prolonged absence without valid reasons, violence, refusal to perform critical work duties, or failing to heed clear performance warnings. The dismissal could be regarded as having no valid reason if the employee was fired for reasonably refusing to accept a transfer.

If an employee takes legal action and the dismissal was found to be without valid reason, the court may order compensation or reinstatement of the employee.

Saudi Arabia law does not yet provide for the concept of redundancies (although the article is undated, it is circa 2011).

Saudi labor law stipulates End of Service (EOS) payments are to be calculated based on the average wages (plus housing allowance) and service years an employee has worked, unless the employee was terminated due to gross misconduct.

If terminated by employer the severance is equal to the wages for a half-month for each year for the first five years of service, and a whole month for each subsequent year.

However, if the employee quits, the award is modified based on the following:

·                     Less than 2 years – no award

·                     2-5 years – one-third of the award

·                     5-10 years – two-thirds of the award

The employee may be entitled to the full award if they leave for reasons outside of their control (force majeure), or if it is a female worker who ends her contract within six months from the date of her marriage or three months from the date of giving birth.

For employees employed at a monthly rate, the employer must give thirty-days notice, or fifteen-days notice for other workmen. Alternatively, the employer can give payment in lieu of notice. Payment is generally based on the average wages of the last three months.

Tax filings are based on the fiscal year of the company and the tax return is due within 120 days of the fiscal year end. Tax returns are submitted to the Department of Zakat and Income Tax (DZIT). If a Saudi citizen has any ownership stake the company must also file audited financial statements with the tax return.

Corporate tax is paid quarterly based on previous years estimates (assuming total annual tax payment is greater than SAR 500,000) and the final tax installment is due within 120 days of the companies fiscal year end.

GOSI – employers social security is calculated on a monthly basis. The rate is 2% for expats and 12% for Saudi nationals.

It is assessed based on the total monthly remuneration in the following categories (subject to an upper limit of SAR 45,000 per month).

1. Basic wage

2. Housing allowance

3. Commission payments

Saudisation requirements may apply for employers where less than 50% of employees are Saudi nationals

GOSI of 10% applies to Saudi nationals

There is no GOSI or employees social security for foreign nationals