Minimum Wage Levels Raised for Saudi Workers

November 23, 2020 Lucy Halse

Key Points

  • Minimum salary levels in the Nitagat program will increase to SAR 4,000/month
  • The wage increase marks an increase from the current minimum of SAR 3,000/month
  • The minimum wage mandates will take effect in April 2021
  • Workers who earn less than the minimum or work part-time are counted as half Saudi workers
  • Minimum wage requirements also apply to working students who are residents of Saudi Arabia

Overview

The Saudi Ministry of Human Resources and Social Development has issued a ministerial decision to raise the minimum wage for Saudi workers.

What are the Changes?

The minimum salary levels for full-time Saudi workers will increase from SAR 3,000 to SAR 4,000 per month in the Nitaqat program. Saudi workers who earn SAR 3,000 or less each month will not be counted in the calculated nationalization percentage through the Nitaqat program. Individuals who earn more than SAR 3,000 but less than SAR 4,000 each month will be counted as a half-citizen worker in the Nitaqat program’s quota count.

Part-time Saudi employees will be counted as half of a regular Saudi worker for the benefit of their employers. Part-time workers must earn at least SAR 3,000 per month and not be counted in the nationalization percentage of more than two entities.

Employees who are compensated on an hourly basis are calculated in the Nitaqat program as one-third of a Saudi worker, provided they pay social insurance and work at least 168 hours for their employer.

Who is Affected?

The minimum wage increases affect Saudi employees along with students who are residents of Saudi Arabia and work on a permanent, regular basis or work through a flexible work system. The increase in minimum wages is designed to attract more workers to the private sector and protect their rights.

Looking Ahead

The new minimum wage requirements will be implemented in April 2021, although the Saudi government has yet to provide a specific date.


Content in this publication is not intended as legal advice, nor should it be relied on as such. For additional information on the issues discussed, consult an Envoy-affiliated attorney or another qualified professional.

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