Managerial Agreement Template for Saudi Arabia

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Key Requirements PROMPT example:

Managerial Agreement

"I need a Managerial Agreement for hiring a new Regional Sales Director for our Saudi-based technology company, who will be an expatriate from India starting March 2025, with responsibility for the GCC region and a team of 50 people."

Document background
The Managerial Agreement is essential for companies operating in Saudi Arabia when hiring senior personnel into management positions. This document is particularly important given the unique aspects of Saudi Arabian employment law and the need to balance international business practices with local legal requirements. It is typically used when appointing department heads, directors, C-suite executives, and other senior managers, whether they are Saudi nationals or expatriates. The agreement must comply with the Saudi Labor Law, Ministry of Human Resources and Social Development regulations, and Sharia law principles. It includes comprehensive provisions for managerial responsibilities, executive compensation, performance metrics, and protection of company interests, while also addressing specific requirements such as Saudization quotas and local business practices.
Suggested Sections

1. Parties: Identification of the employer company and the manager, including full legal names, addresses, and relevant registration/ID numbers

2. Background: Context of the appointment, including the manager's position and general purpose of the agreement

3. Definitions: Key terms used throughout the agreement, including definition of the Business, Confidential Information, Intellectual Property, etc.

4. Appointment and Term: Details of the position, effective date, and duration (fixed-term or indefinite)

5. Duties and Responsibilities: Comprehensive outline of the manager's role, reporting lines, and scope of authority

6. Working Hours and Location: Standard working arrangements, flexibility requirements, and primary work location

7. Remuneration and Benefits: Base salary, bonuses, allowances, and benefits package in compliance with Saudi Labor Law

8. Leave Entitlements: Annual leave, sick leave, and other types of leave as per Saudi Labor Law

9. Confidentiality: Obligations regarding company information and trade secrets

10. Non-Competition and Non-Solicitation: Post-employment restrictions in accordance with Saudi law

11. Intellectual Property: Ownership and rights related to work products and innovations

12. Termination: Grounds and procedures for termination, notice periods, and consequences

13. Governing Law and Jurisdiction: Specification of Saudi law as governing law and relevant dispute resolution mechanisms

Optional Sections

1. International Travel: For roles requiring significant international travel, detailing travel policies and allowances

2. Delegation of Authority: Specific powers of attorney and signing authorities, used for senior executive positions

3. Performance Metrics: Detailed KPIs and performance evaluation criteria, typically for performance-based compensation structures

4. Compliance Requirements: Industry-specific compliance obligations, particularly relevant for regulated sectors

5. Secondment Terms: For managers seconded from international companies or group entities

6. Religious Accommodation: Specific provisions for religious observances and practices

7. Housing and Transportation: Details of housing and transportation benefits, particularly for expatriate managers

8. Family Benefits: Additional benefits related to family members, typically for expatriate packages

Suggested Schedules

1. Schedule 1 - Compensation Structure: Detailed breakdown of salary components, bonus calculations, and benefit valuations

2. Schedule 2 - Position Description: Detailed job description, responsibilities, and reporting relationships

3. Schedule 3 - Performance Metrics and KPIs: Specific performance indicators and measurement criteria

4. Schedule 4 - Company Policies: Key company policies applicable to the manager's role

5. Schedule 5 - Benefits Package: Detailed description of all benefits and allowances

6. Schedule 6 - Delegation of Authority Matrix: Specific authorities and limitations on the manager's powers

7. Appendix A - Code of Conduct: Company's code of conduct and ethical requirements

8. Appendix B - Compliance Documentation: Required compliance certifications and declarations

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Clauses
Relevant Industries

Banking and Financial Services

Manufacturing

Oil and Gas

Healthcare

Technology

Retail and Consumer Goods

Construction and Real Estate

Telecommunications

Education

Professional Services

Hospitality and Tourism

Transportation and Logistics

Mining and Minerals

Energy and Utilities

Government and Public Sector

Relevant Teams

Human Resources

Legal

Executive Office

Board Secretariat

Compliance

Finance

Operations

Sales and Marketing

Information Technology

Research and Development

Strategy

Corporate Communications

Risk Management

Project Management Office

Relevant Roles

Chief Executive Officer

Managing Director

General Manager

Department Director

Regional Manager

Division Head

Country Manager

Operations Manager

Finance Director

Sales Director

Technical Director

Project Director

Branch Manager

Executive Vice President

Senior Manager

Head of Department

Industries
Saudi Labor Law (Royal Decree No. M/51): The primary legislation governing employment relationships in Saudi Arabia, covering contract requirements, working hours, leave entitlements, termination procedures, and other fundamental employment rights and obligations
Saudization (Nitaqat) Regulations: Requirements for hiring Saudi nationals in managerial positions and meeting quota requirements for Saudi employees in the company
Social Insurance Law: Regulations regarding mandatory social insurance coverage, including pension and occupational hazards insurance through the General Organization for Social Insurance (GOSI)
Anti-Corruption Law: Legislation governing integrity and anti-corruption measures, particularly relevant for managerial positions with decision-making authority
Corporate Governance Regulations: Rules issued by the Capital Market Authority regarding corporate governance, particularly relevant for managers in listed companies or regulated sectors
Ministry of Human Resources and Social Development (MHRSD) Resolutions: Various ministerial resolutions and implementing regulations that affect managerial employment, including specific requirements for executive positions
Saudi Arabian Monetary Authority (SAMA) Regulations: For managers in financial institutions, SAMA regulations regarding fit and proper criteria and executive responsibilities must be considered
Income Tax Law: Regulations regarding taxation of employment income, particularly relevant for expatriate managers and tax compliance obligations
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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