Saudi Arabia - Minimum Wages - 2011

3 June 2011

Labour Law (Royal Decree No. M/51) of September 2005.

Saudi Arabia Human Rights Report 2010 of the U.S. Department of State

The term "worker" means any natural person working for an employer and under his management or supervision for a wage, even if he is not under his direct control.

The term "employer" means any natural or corporate person employing one or more workers for a wage.

The term "actual wage"means the basic wage plus all other due increments decided for the worker for the effort he exerts at work or for risks he encounters in performing his work, or those decided for the worker for the work under the work contract or work organization regulation. This includes:
(1) The commission or percentage from sales or profits paid against what the worker markets, produces, collects or realizes from increased or enhanced production.
(2) Allowances the worker is entitled to for exerted effort, or risks he encounters while performing his job.
(3) Increments that may be granted in accordance with the standard of living or to meet family expenses.
(4) Grant or reward: What the employer grants to the worker and what is paid to him for honesty or efficiency and the like, if such grant or reward is stipulated in the work contract or the work organization regulation of the firm or if customarily granted to the extent that the workers consider it part of the wage rather than a donation.
(5) In rem privileges: what the employer commits himself to provide to the worker for his work by stating it in the work contract or the work organization regulation and its estimated at a maximum of two months basic wage per annum, unless it is otherwise determined to exceed that in the work contract or the work organization regulation.

The term "basic wage" means all that is given to the worker for his work by virtue of a written or unwritten work contract regardless of the kind of wage or its method of payment, in addition to periodic increments.

Although the legislation provides for the establishment of a minimum wage system by the government, in fact no minimum wages have been implemented. Wages are fixed in individual agreements between the worker and the employer.

If the work contract or the work organization regulation does not provide for the wage binding on the employer, the wage estimated for the same type of work in the firm, if any, shall be adopted; otherwise, the wage shall be estimated in accordance with the profession¿s norms at the place where the work is performed. In the absence of such norms, the Commission for Settlement of Labor Disputes shall estimate the wage in accordance with the dictates of justice.

The following shall be exempted from the implementation of the provisions of this Law:
(1) The employer’s family members, namely, the spouse, the ascendants and descendants who constitute the only workers of the firm.(2) Domestic helpers and the like.
(3) Sea workers working on board of vessels with a load of less than five hundred tons.
(4) Agricultural workers other than the categories stated in Article (5) of this Law.
(5) Non-Saudi workers entering the Kingdom to perform a specific task for a period not exceeding two months.
(6) Players and coaches of sports clubs and federations.

No minimum wage exists.

The worker’s wages and all other entitlements shall be paid in the Country’s official currency.

Workers paid on a daily basis shall be paid at least once a week.

Workers paid on a monthly basis shall be paid once a month.

If the work is done by the piece and requires a period of more than two weeks, the worker shall receive a payment each week commensurate with the completed portion of the work. The balance of the wage shall be paid in full during the week following delivery of the work.
In other cases, the worker’s wages shall be paid at least once a week.

Wages may be paid through accredited banks in the Kingdom, with the consent of the worker, provided that their due dates do not exceed the
dates specified above.

Work inspectors shall have the right to:
- Access any firm at any time, day or night, without prior notice.
- Perform any examination or investigation required to ascertain proper implementation of the Law. They may in particular:
(a) Question the employer, his representative or the workers in private or in the presence of witnesses about any matter relating to the implementation of the provisions of the Law.
(b) Review all books, records and other documents and obtain any copies or extracts therefrom.
(c) Take sample(s) of the materials used or handled in the industrial and other operations subject to inspection and believed to have a harmful effect on the health or safety of workers, for the purpose of analyzing such samples in government laboratories to determine the extent of such effect, and duly notify the employer or his representative of the same.

If any amount is deducted from the worker¿s wages for reasons other than those specified in this Law without his written consent, or if the employer delays, without a valid justification, payment of the worker¿s wages beyond the due date set forth in the Law, the worker, his representative or the head of the competent Labour Office may submit a request to the Commission for the Settlement of Labour Disputes to order the employer to return to the worker any wrongfully-deducted amounts or to pay him his outstanding wages.
The said Commission may, if it establishes that the employer has unjustifiably deducted the said amounts or delayed the payment of the wages, impose on the employer a fine not exceeding twice the amount deducted from the worker¿s wage or twice the outstanding wages.