The Offer Letter and Employment Agreement is a fundamental document used when establishing an employment relationship in Saudi Arabia. It serves dual purposes: first as a formal offer of employment detailing the position and basic terms, and second as a comprehensive employment agreement once accepted. The document must strictly comply with Saudi Labor Law (Royal Decree No. M/51) and related regulations, incorporating mandatory provisions for working hours, leave entitlements, probation periods, and end of service benefits. It's essential for both Saudi nationals and expatriate workers, requiring careful consideration of Saudization requirements, visa regulations, and local customs. The agreement typically includes provisions for salary, benefits, working conditions, and termination terms, all structured to meet the requirements of Saudi Arabian employment legislation and Shariah principles.
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1. Parties: Identification of the employer and employee, including full legal names and addresses
2. Background: Brief context of the employment offer and agreement
3. Definitions: Key terms used throughout the agreement
4. Position and Duties: Job title, role description, and primary responsibilities
5. Commencement and Duration: Start date and term of employment (fixed-term or unlimited)
6. Probation Period: Duration and terms of the probationary period as per Saudi Labor Law
7. Compensation and Benefits: Base salary, allowances, and mandatory benefits under Saudi law
8. Working Hours and Location: Standard working hours, workplace location, and flexibility terms
9. Leave Entitlements: Annual leave, sick leave, and other types of leave as per Saudi Labor Law
10. Confidentiality: Protection of company confidential information and trade secrets
11. Termination: Grounds and procedures for contract termination as per Saudi Labor Law
12. End of Service Benefits: Calculation and payment of end of service gratuity
13. Governing Law: Confirmation of Saudi Law application and dispute resolution procedures
1. Non-Competition: Restrictions on working for competitors, used for senior positions or roles with access to sensitive information
2. Intellectual Property Rights: IP ownership and assignment provisions, relevant for technical or creative roles
3. Training Commitments: Training requirements and associated bonds, used when significant training investment is planned
4. Performance Bonus: Variable compensation terms, included for sales roles or management positions
5. Housing Allowance: Specific terms for housing benefits, included when offering accommodation benefits
6. Transportation Allowance: Details of transportation benefits, included when offering transport benefits
7. Relocation Terms: Relocation assistance and conditions, used for expatriate employees
8. Medical Insurance: Details of medical coverage beyond mandatory requirements
1. Schedule 1 - Job Description: Detailed description of role, responsibilities, and reporting relationships
2. Schedule 2 - Compensation Structure: Breakdown of salary components and benefits
3. Schedule 3 - Company Policies: Key company policies that form part of the employment terms
4. Appendix A - Required Documents: List of documents required for employment visa/permit (if applicable)
5. Appendix B - Code of Conduct: Company's code of conduct and ethical standards
6. Appendix C - Benefits Summary: Detailed overview of all benefits and eligibility criteria
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