Saudi labour law for international employees: contracts, leave and end of service

The short version

Saudi employment contracts are governed by the Labour Law and the Implementing Regulations ("the Regulations") of the Ministry of Human Resources and Social Development. Both changed on 19 February 2025 (20 Sha'ban 1446 AH), when the amendments made by Royal Decree M/44 came into force with a new edition of the Regulations. For a non-Saudi, the biggest changes are:

• Your contract is fixed-term by law. If it states no term, it runs for one year and renews for the same period if you keep working.
• Probation is capped at 180 days in total.
• A resignation takes effect when the employer accepts it, or after 30 days with no reply.
• The employer must provide housing and transport, or a cash allowance for each.

This page was checked on 15 October 2026 against the official Arabic text of the Labour Law and the April 2025 edition of the Regulations. Both are amended from time to time, so check the date on anything you plan to act on.

Your contract is fixed-term by law

A non-Saudi's contract must be written and fixed-term. If it states no term, it runs for one year from the day you actually start work, and if you carry on working after that, it renews for the same period (Article 37). Until February 2025 such a contract ran for the length of the work permit. However often it renews, it never becomes open-ended, even if both sides agree (Regulations, Article 12), and the ministry's unified contract form doesn't offer non-Saudis that option.

• Renewals don't restart your service. Each renewal counts as an extension of the original term for rights that depend on length of service, including the end-of-service award (Article 56).
• Check the documented version. The employer must document your contract on the ministry's platform (Regulations, Article 18). Make sure that version matches your offer.
• The calendar is Hijri unless your contract or the employer's work regulations say otherwise (Article 10).

The law excludes domestic workers, and non-Saudis who come for a specific task of two months or less (Article 7). For the visa behind the contract, see the Saudi work visa.

Probation

Probation applies only if the contract states it and how long it lasts. The old rule of 90 days plus a written extension has gone. The total is now capped at 180 days (Article 53). The period can be split into consecutive stretches, but only if the contract says so when it is signed. Eid al-Fitr, Eid al-Adha, National Day and Founding Day holidays don't count towards it, and nor does sick leave, so they push the end date back (Regulations, Article 19).

Either side can end the contract during probation. Neither side owes compensation, and no end-of-service award is due (Articles 53 and 54). An employer can put you on probation only once. A second probation needs your written agreement, and it must be for a different job or start at least six months after your earlier employment there ended (Article 54).

Working hours

The ceiling is eight hours a day on a daily standard or 48 a week on a weekly one. In Ramadan, Muslim employees work no more than six hours a day or 36 a week (Article 98). No one can be made to work more than five hours in a row without a break of at least half an hour, or be kept at the workplace more than 12 hours a day (Article 101). These limits don't apply to senior managers whose role gives them an employer's authority over staff (Article 108). If your role is close to that line, ask how it is classified.

Overtime is paid at the hourly wage plus 50% of your basic wage (Article 107). On a weekly standard, every hour beyond it is overtime, and so is every hour worked on holidays and Eids. The premium is worked out on basic wage, so a package weighted towards allowances earns less of it. Since February 2025, the employer can give you paid time off instead, if you agree (Article 107). You get at least an hour and a half off for each overtime hour, up to 30 days a year, and any you haven't taken is paid out when you leave (Regulations, Article 22-bis). Overtime is capped at 720 hours a year unless you agree to more (Regulations, Article 22).

Leave

Annual leave figures are minimums; a contract can give more. The leave must be taken in the year it falls due and can't be swapped for cash while you're employed. The employer must tell you the dates at least 30 days ahead (Article 109). Untaken leave is paid out when you leave (Article 111). A public holiday that falls during your annual leave extends it, and sick leave suspends it (Regulations, Articles 24 and 26). An employer can't end your service for illness before your sick leave runs out (Article 82). It also can't dismiss an employee, or warn her of dismissal, while she is pregnant or on maternity leave (Article 155).

What the employer must pay for

Under Article 40, the employer pays:

• recruitment fees;
• iqama and work-permit fees, renewals, and any late fines it causes;
• change-of-profession fees, and exit and re-entry fees;
• your ticket home when the employment ends.

You pay your own way home only if you prove unfit for the work or leave without a valid reason. See the iqama explained and exit and re-entry visas.

Since February 2025 the employer must also provide decent housing, and transport between home and work. In place of either, it can pay a suitable cash allowance with your wage (Article 61). The housing duty applies in the private and non-profit sectors (Regulations, Article 21).

The law gives you a ticket home at the end, not a flight every year. If an annual flight was in the offer, get it into the contract. Negotiating a Saudi job offer covers how. Wages are paid in Saudi riyals, monthly for monthly-paid staff, through banks accredited in the Kingdom. The minister can exempt some employers from the bank requirement (Article 90).

End-of-service benefit

This is the provision most worth understanding, because it builds up with every year you work:

• Half a month's wage for each of the first five years
• A month's wage for each year after that
• Part-years in proportion

It is calculated on your last wage (Article 84). In the Labour Law, "wage" means the actual wage, not basic pay alone. That is your basic wage plus the other increases you are due for effort or risk, or that the contract or work regulations set in return for the work (Article 2). Commissions, sales percentages and similar variable pay can be left out by agreement (Article 86). Article 2 doesn't name a housing allowance, so confirm in writing which parts of your package count before you sign.

Other endings:

• The whole award is still due if you left for a reason in Article 81. It is also due for force majeure, or when a woman ends the contract within six months of her marriage contract or three months of giving birth (Article 87).
• Nothing is due after a dismissal under Article 80, or an ending during probation (Article 54).

A resignation at exactly five years pays one third; two thirds needs more than five. The employer must pay within a week of the contract ending, or two weeks if you ended it, and may deduct any work-related debt you owe it (Article 88). Run your figures in the end-of-service calculator. The end-of-service benefit explained has worked examples.

Notice, resignation and ending a contract early

Article 75's notice periods apply to open-ended contracts. Since February 2025, where pay is monthly, the worker must give at least 30 days' written notice and the employer at least 60 days', for a legitimate reason. Where pay is not monthly, the minimum is 30 days either way (Article 75). Whoever skips the notice owes the other the worker's wage for the notice period (Article 76). A non-Saudi's contract can't be open-ended, so these periods don't govern yours. These do:

Non-renewal. Under the unified contract form, a fixed-term contract either ends on a stated date or renews automatically. Either side can stop an automatic renewal by notice through the ministry's platform, a set number of days before the end date. That number is written into the contract, and the same figure applies to both sides. Find it before you sign.

Resignation. Article 2 now defines it as your written, unconditional statement, made without coercion, that you want to end a fixed-term contract, plus the employer's acceptance. Article 79-bis sets the timetable:

• The contract ends when the employer accepts, or once 30 days pass with no reply.
• If the work requires it, the employer can postpone acceptance by up to 60 days. It must give you written reasons before the 30 days run out, and the 60 days count from then.
• You can withdraw within seven days, unless the employer has already accepted.
• You can't put a later date in the resignation.
• The contract stays in force while the resignation is pending.
• You keep your statutory rights. For the end-of-service award, those are the shares above.

So plan for the 30 days, and for the chance that the employer adds the postponement on top of them.

Ending early without a valid reason. Unless the contract sets its own figure, whichever side does this owes the other the wage for the rest of the fixed term, and never less than two months' wage (Article 77).

Without notice. You can leave at once and keep all your rights for a reason in Article 81, for example if the employer fails its essential obligations or deceived you about the terms. The employer can dismiss you without notice, award or compensation only for a reason in Article 80, and must let you object first.

Income tax and social insurance

The Income Tax Law does not list salaried employment among the things it taxes. Article 2 of the law names who pays. That means resident companies, on shares owned by non-Saudis, and non-Saudi residents who carry on an "activity" in the Kingdom. It also covers certain non-residents with Saudi income and the oil and gas sectors. "Activity" means commercial, professional or craft work carried on for profit (Article 1). A side business could bring you under Article 2. The Labour Law separately bars you from working for another employer, or on your own account, outside the official procedures (Article 39).

Social insurance depends on nationality. The occupational-hazards branch covers every worker in the Kingdom. The pensions branch and unemployment insurance are compulsory for Saudi workers (Social Insurance Law, Articles 14, 28 and 43). The unified contract form obliges your employer to register you with GOSI and pay the contributions.

Compare offers on what you would take home, housing included, not on the gross figure. Benchmarks are on the salaries pages.

Check your home country. It may still tax you. US citizens and resident aliens living abroad, for example, are taxed on worldwide income from all sources. If your country taxes by residence, find out what it takes to stop being tax-resident there.

Changing employer

Under Article 14 of the Regulations, a non-Saudi can move without the current employer's consent:

• at the end of the contract, once your documented contract has ended;
• during the contract, once 12 months have passed since you entered the Kingdom and you have given the current employer at least 90 days' notice, unless you agree otherwise. This is expressly subject to Article 77, so leaving a fixed term early can still cost you the compensation above;
• if the employer defaults, with ministry approval. The listed cases include wages unpaid or paid late for three months in a row (you must apply within a Hijri year of the third month's due date).

With the current employer's consent, you can move at any time, unless the Nitaqat Saudisation rules say otherwise. The new employer must meet the ministry's conditions too, including its Nitaqat ratio. If the ministry refuses to renew your work permit because your employer broke the rules, the Regulations must protect you, including by allowing a move without that employer's consent (Article 35).

The move runs on the Qiwa platform. The new employer makes an offer, you accept it, and your current employer is notified. The system then checks the conditions and issues a new work permit.

Disputes

A labour claim starts with the ministry's free amicable settlement service, not the court. File online with the settlement office for your place of work, attaching your contract or other proof of employment. If mediation fails, the office issues a record saying so, and you can file with the labour court under Ministry of Justice procedures. The ministry puts the settlement stage at 21 working days from the first session.

A waiver or settlement of your Labour Law rights signed while the contract is still running is void, unless it is more favourable to you (Article 8). Keep your contract, offer letter and any written changes. An email confirming a verbal agreement is worth more than a clear memory of the conversation.

Sources

• Saudi Labour Law, official text (Bureau of Experts at the Council of Ministers): Articles 2, 7, 8, 10, 35, 37, 39, 40, 53, 54, 56, 61, 75 to 77, 79-bis, 80 to 82, 84 to 88, 90, 98, 101, 107 to 109, 111 to 113, 117, 151 and 155, as amended by Royal Decree M/44 (in force 1446/8/20 AH), checked 15 October 2026
• Ministry of Human Resources and Social Development: Implementing Regulations of the Labour Law and annexes (Articles 12, 14, 18, 19, 21, 22, 22-bis, 24 and 26, and Annex 5, the unified employment-contract forms)
• Ministry of Human Resources and Social Development: announcement that the amendments and Regulations took effect on 20 Sha'ban 1446 AH (19 February 2025)
• Ministry of Human Resources and Social Development: amicable settlement of labour disputes service, English and Arabic
• Ministry of Human Resources and Social Development: transfer of services from another employer (freedom of movement) service
• Income Tax Law, official text (Bureau of Experts): Articles 1 and 2
• Social Insurance Law 1445H, official text (Bureau of Experts): Articles 14, 28 and 43
• US Internal Revenue Service: U.S. citizens and resident aliens abroad

General information, not legal advice. Rules change and cases vary by nationality, profession and employer.