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Individual Employment Agreement for Saudi Arabia

Individual Employment Agreement Template for Saudi Arabia

A comprehensive employment agreement template designed for use in Saudi Arabia, compliant with the Saudi Labor Law (Royal Decree No. M/51) and Sharia principles. This agreement establishes the terms and conditions of employment between an employer and an individual employee, covering essential aspects such as appointment terms, duties, compensation, benefits, working hours, leave entitlements, and end of service benefits. The document incorporates mandatory requirements under Saudi labor regulations, including Wage Protection System compliance, GOSI requirements, and consideration of local working practices such as prayer times and Ramadan hours.

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What is a Individual Employment Agreement?

The Individual Employment Agreement serves as the foundational document governing the employment relationship in Saudi Arabia. It is designed for use when hiring new employees or formalizing existing employment relationships, ensuring compliance with Saudi Labor Law and related regulations. The agreement incorporates mandatory provisions required by Saudi authorities, including working hours, leave entitlements, end of service benefits, and Wage Protection System requirements. It is structured to protect both employer and employee interests while maintaining alignment with Sharia principles and local business practices. The document is particularly important in Saudi Arabia's increasingly regulated employment environment, where written contracts are mandatory and specific terms must be explicitly stated to be enforceable.

What sections should be included in a Individual Employment Agreement?

1. Parties: Identification of the employer and employee, including full legal names, addresses, and relevant identification numbers

2. Background: Brief context of the employment relationship and purpose of the agreement

3. Definitions: Key terms used throughout the agreement

4. Appointment and Term: Position title, employment status (permanent/fixed-term), and commencement date

5. Duties and Responsibilities: Main responsibilities, reporting lines, and performance expectations

6. Place of Work: Primary workplace location and potential for transfer

7. Working Hours: Standard working hours, prayer breaks, and Ramadan hours as per Saudi Labor Law

8. Remuneration: Base salary, allowances, and payment method complying with WPS requirements

9. Leave Entitlements: Annual leave, sick leave, Hajj leave, and other statutory leave entitlements

10. Benefits: Health insurance, social insurance (GOSI), and other statutory benefits

11. End of Service Benefits: Calculation and payment of end of service gratuity as per Saudi Labor Law

12. Termination: Notice periods and grounds for termination as per Saudi Labor Law

13. Confidentiality: Protection of employer's confidential information

14. Governing Law: Confirmation of Saudi Law application and dispute resolution process

15. Language: Specification of Arabic as the governing language with English translation if provided

What sections are optional to include in a Individual Employment Agreement?

1. Probationary Period: Used when implementing a probationary period up to 90 days as permitted by Saudi Labor Law

2. Non-Competition: Used for senior positions or roles with access to sensitive information, must comply with Saudi Labor Law restrictions

3. Intellectual Property: Used for technical, creative, or research-based roles

4. Remote Working: Used when allowing work from home or remote working arrangements

5. Commission Structure: Used for sales positions or roles with variable compensation

6. International Assignment: Used for expatriate employees or roles requiring international travel

7. Training Obligations: Used when specific training requirements or bonds are applicable

8. Vehicle Allowance: Used when providing company vehicle or transport allowance

What schedules should be included in a Individual Employment Agreement?

1. Schedule 1 - Job Description: Detailed description of role, responsibilities, and key performance indicators

2. Schedule 2 - Compensation Details: Breakdown of salary components, allowances, and benefits

3. Schedule 3 - Company Policies: Key workplace policies including IT, harassment, and disciplinary procedures

4. Schedule 4 - Performance Review Process: Details of performance evaluation criteria and timing

5. Appendix A - Required Documents: List of documents required for employment (qualifications, certificates, etc.)

6. Appendix B - Employee Code of Conduct: Specific behavioral expectations and ethical guidelines

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Saudi Arabia

Publisher

Ƶ

Document Type

Employment Contract

Cost

Free to use
Relevant legal definitions




























Clauses





































Relevant Industries

Banking & Financial Services

Information Technology

Manufacturing

Healthcare

Construction

Retail

Education

Oil & Gas

Professional Services

Telecommunications

Real Estate

Hospitality

Transportation & Logistics

Media & Entertainment

Relevant Teams

Human Resources

Legal

Finance

Information Technology

Sales

Marketing

Operations

Research & Development

Customer Service

Administration

Quality Assurance

Business Development

Production

Supply Chain

Corporate Communications

Relevant Roles

Chief Executive Officer

Chief Financial Officer

General Manager

Department Manager

Software Engineer

Sales Manager

HR Manager

Marketing Specialist

Account Executive

Project Manager

Administrative Assistant

Operations Manager

Research Analyst

Technical Support Specialist

Business Development Manager

Financial Analyst

Legal Counsel

Quality Assurance Engineer

Customer Service Representative

Production Supervisor

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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