The Business Employment Contract serves as a fundamental legal document for establishing employment relationships in Saudi Arabia's private sector. It is essential for any business entity operating in Saudi Arabia when hiring employees, whether Saudi nationals or expatriates. The contract must comply with the Saudi Labor Law (Royal Decree No. M/51), Wage Protection System regulations, and Saudization requirements while incorporating Islamic Shariah principles. This document is crucial for defining employment terms, protecting both employer and employee rights, and ensuring regulatory compliance. It should be used when hiring permanent employees, whether for fixed-term or unlimited-term employment, and must be written in Arabic (with optional additional languages) to be legally enforceable in Saudi Arabia.
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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 contract
4. Position and Duties: Job title, role description, responsibilities, and reporting relationships
5. Term and Probation Period: Contract duration (fixed/unlimited term) and probation period details as per Saudi Labor Law
6. Working Hours and Location: Standard working hours, workplace location, and flexible working arrangements if applicable
7. Remuneration: Base salary, payment schedule, currency, and method of payment in compliance with WPS
8. Benefits and Allowances: Housing allowance, transportation allowance, and other standard benefits
9. Leave Entitlements: Annual leave, sick leave, Hajj leave, and other statutory leave entitlements
10. Social Insurance and Medical Insurance: GOSI registration and medical insurance coverage requirements
11. Confidentiality and Data Protection: Protection of company information and handling of employee data
12. Non-Competition and Intellectual Property: Post-employment restrictions and ownership of work products
13. Termination: Grounds for termination, notice periods, and end of service benefits
14. Governing Law: Confirmation of Saudi Law application and dispute resolution mechanisms
1. International Transfer Provisions: For expatriate employees, including visa sponsorship and repatriation terms
2. Commission Structure: For sales or commission-based roles, detailing commission calculations and payment terms
3. Training Requirements: For positions requiring specific training or qualifications maintenance
4. Remote Working Provisions: For roles allowing work from home or remote working arrangements
5. Performance Bonus Scheme: For roles with performance-based incentives
6. Secondment Terms: For employees temporarily assigned to different locations or group companies
7. Educational Assistance: For roles offering continued education or professional development support
1. Schedule 1 - Job Description: Detailed description of role, responsibilities, and performance expectations
2. Schedule 2 - Compensation Details: Breakdown of salary components, allowances, and benefits
3. Schedule 3 - Company Policies: Key company policies including code of conduct, IT usage, and workplace behavior
4. Schedule 4 - Performance Metrics: KPIs and performance evaluation criteria
5. Appendix A - Required Documents: List of documents required for employment record
6. Appendix B - Employee Handbook Acknowledgment: Confirmation of receipt and understanding of company policies
7. Appendix C - Confidentiality Agreement: Detailed confidentiality obligations and restrictions
Authors
Relevant legal definitions
Clauses
Relevant Industries
Financial Services
Technology
Manufacturing
Retail
Healthcare
Construction
Energy
Professional Services
Telecommunications
Education
Hospitality
Real Estate
Mining
Transportation
Media and Entertainment
Relevant Teams
Human Resources
Legal
Finance
Operations
Information Technology
Sales
Marketing
Research and Development
Administration
Customer Service
Production
Quality Assurance
Business Development
Strategy
Compliance
Relevant Roles
Chief Executive Officer
Managing Director
General Manager
Department Head
Senior Manager
Project Manager
Financial Analyst
Software Developer
HR Manager
Sales Executive
Operations Manager
Marketing Specialist
Legal Counsel
Research Analyst
Administrative Assistant
Technical Specialist
Business Development Manager
Account Manager
Quality Control Manager
Production Supervisor
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