Posted by : Aahil Shaik Monday, May 30, 2022

Ministry of Human Resources clarifies on how to calculate Annual entitlements in Saudi Arabia


The Ministry of Human Resources and Social Development in Saudi Arabia has clarified the method of calculating annual leave entitlements, as per the Labor Law in force in the Kingdom of Saudi Arabia. Join Saudi Expatriates channel on Telegram







This came after some of the workers had wondered whether the annual leave entitlements are calculated on the basic salary only, or if it is calculated based on the salary including housing and transportation.

- The Ministry confirmed that the annual leave wage is calculated based on the actual wage, including all allowances, in accordance with the definition of wages in Article 2 of Saudi Labor Law. Trending : A worker is entitled 30-days full pay sick leave

Basic Wage definition in Article 2 of Saudi Labor Law :

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.





Actual Wage definition in Article 2 of Saudi Labor Law :

The basic wage plus all other due increments decide for the worker for the effort he apply 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 of sales or profits paid against what the worker markets, produces, collects or realizes from increase or enhanced production. Most Viewed : 60 days notice period required to terminate the work contract

2. Allowance 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 to 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 to the workers consider it part of the wage rather than a donation. Read : Clarification on 21 and 30 days annual leave for workers

5. In rem privileges : What the employer commits himself to provide to the worker for his work by stating in the work contract or the work organization regulation and its estimated at a maximum of 2 months basic wage per annum, unless it is otherwise determined to exceed that in the work contract or the work organization regulation.




Human Resources clarifies on how to calculate Annual entitlements in Saudi Arabia - Saudi-Expatriates.com

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