Starting a business in Saudi Arabia is an exciting opportunity, especially with the Kingdom’s ongoing Vision 2030 reforms. Once your company is legally established, one of the next key steps is hiring employees. This guide outlines the essential steps and compliance requirements for hiring in Saudi Arabia. For more information please visit Company formation in saudi arabia

1. Understand Saudization (Nitaqat Program)

Saudi Arabia mandates local hiring under the Nitaqat system, which classifies companies based on their percentage of Saudi nationals employed.

  • Higher Saudization = More Benefits
    Companies with higher local employee ratios enjoy benefits like expedited visa processing.
  • Penalties for Non-Compliance
    Non-compliance can lead to work permit denials or business restrictions.

2. Register with GOSI (General Organization for Social Insurance)

GOSI registration is required before hiring any employee. It covers social insurance for both Saudi and non-Saudi employees.

  • Employer Contributions:
    ~22% of a Saudi employee’s salary
    ~2% for expat employees (occupational hazards only)

3. Use the Qiwa Platform

Qiwa is a digital platform that simplifies the recruitment and employment process:

  • Draft employment contracts
  • Post job vacancies
  • Manage Saudization compliance

All employment contracts must be registered through Qiwa.

4. Get Work Visas for Expatriates

To hire non-Saudis, obtain work visas through the Ministry of Human Resources and Social Development (MHRSD) and the Ministry of Interior via:

  • Musaned (for domestic workers)
  • Muqeem/Absher (for residency/work permit issuance)

Make sure your company has an adequate visa quota before applying.

5. Draft Compliant Employment Contracts

Contracts should include:

  • Job title and duties
  • Salary and benefits
  • Working hours and leave entitlements
  • Probation period
  • Termination conditions

Contracts must comply with Saudi labor law and be in Arabic (or bilingual format).

6. Offer Mandatory Benefits

Employers must provide:

  • Annual leave (21–30 days)
  • Medical insurance
  • End-of-service benefits
  • Paid public holidays
  • Overtime pay (if applicable)

7. Use Wage Protection System (WPS)

WPS ensures that salaries are paid timely and transparently. All salary payments must go through a registered Saudi bank account and be reported in WPS.

8. Train and Onboard New Hires

Investing in employee training, especially for Saudi nationals, supports compliance and workforce productivity.

  • Onboarding should include health and safety, company culture, and role-specific training.

Final Thoughts

Hiring in Saudi Arabia involves navigating legal, cultural, and administrative frameworks. By following the correct procedures and staying compliant, your company can build a strong and legally secure workforce. Always consider partnering with a local HR consultant or PEO (Professional Employer Organization) for smoother onboarding.