But because the region has no personal taxation, net income is usually much greater, which is one of the major attractions of working in Saudi Arabia. In the past, remuneration packages were split into various elements: basic salary, car provision or allowance, housing provision or allowance, medical cover, education for children and air tickets for home visits. Today, however, employers tend just to pay a salary, which covers all these expenses, although in some cases there are performance or other bonuses.
In addition to their salary, contract workers are awarded an ‘indemnity’ at the end of the contract period. Saudi Arabia legislates that the indemnity is based on the value of the entire remuneration package including performance bonuses (where applicable). The indemnity can be a significant amount of money if you’ve been working in Saudi Arabia for a long time, and many people manage either to accumulate a reasonable financial cushion or to live the high life. If you’re clever and disciplined, you should be able to do some of both. The indemnity has nothing to do with insurance but is an end-of-contract bonus which is required by law to be paid to expatriate workers as a sort of ‘thank-you’ for being of service to the state. (It’s also known as ‘end of service benefits’.) Indemnity scales usually amount to 15 (in some cases 20) days of basic pay per year of employment for the first three years and thereafter a month’s salary per year of employment.
Note that some Arab companies regularly delay the payment of salaries, cash flow problems being passed on to their staff. In this event, you have little alternative but to wait.
Working Hours & Overtime
The working week in Saudi Arabia tends to vary between 40 and 48 hours, depending on the particular company’s policy. In the month of Ramadan, the working day is reduced to six hours and legally this should apply to all staff, but many companies only apply it to Muslims, who fast during daylight hours. There are no differences in timekeeping between summer and winter
Office hours vary, ranging from 7.30am - 8am until noon, then from 3.30pm - 4pm until 7pm - 8pm. Although there are some offices which may close at 6pm.
Keep in mind that most government offices are open from 7.30am to 2.30pm and general banking hours are from 8 am until noon, and then from 5pm until 8pm. It is important to take into account the five daily prayer times, as well as Islamic holidays.
Friday is the Muslim day of rest and if your company has a five-day working week, your other day off would probably have been either Thursday or Saturday. Saudi Arabia now enjoys a Sunday-Thursday work week, with Friday-Saturday its official weekend. Saturday used to be the more popular choice for international companies, as taking Thursday off would mean a reduction in the number of operational days in common with much of the rest of the world.
Conversely, other companies insisted on Thursday, as the school ‘weekend’ is Thursday and Friday. The decision to implement Saturday as the second day off was made by the government to make sure that companies do not miss out on economic opportunities on Thursdays, especially regarding international businesses.