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Definite Employment Contract for Saudi Arabia

Definite Employment Contract Template for Saudi Arabia

A Definite Employment Contract under Saudi Arabian law is a fixed-term employment agreement that establishes a clear employment relationship with a specified end date. This contract complies with the Saudi Labor Law and related regulations, including recent reforms implemented in 2021. It covers essential employment terms such as duration, compensation, benefits, working hours, and termination conditions, while ensuring compliance with Saudization requirements and mandatory benefits under Saudi law. The contract provides legal protection for both employer and employee while maintaining alignment with local labor regulations and cultural considerations.

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What is a Definite Employment Contract?

The Definite Employment Contract is a crucial document used in Saudi Arabia when establishing fixed-term employment relationships with a predetermined duration. This contract type is particularly relevant for project-based work, temporary assignments, or when companies need to hire for a specific period. It must comply with the Saudi Labor Law, which requires specific provisions regarding contract duration, probation periods, working hours, leave entitlements, and end of service benefits. The contract serves as a legally binding document that protects both employer and employee interests while ensuring compliance with local regulations, including Saudization requirements and the Wage Protection System. Recent labor law reforms in Saudi Arabia have impacted various aspects of fixed-term employment, making it essential to use up-to-date contract templates that reflect current legal requirements.

What sections should be included in a Definite Employment Contract?

1. Parties: Identification of the employer and employee with full legal names and details as required by Saudi Labor Law

2. Background: Brief context of the employment relationship and purpose of the agreement

3. Definitions: Key terms used throughout the contract

4. Term and Duration: Specific start date and duration of the fixed-term contract

5. Job Description and Duties: Detailed description of the position, responsibilities, and reporting structure

6. Place of Work: Primary work location and potential for relocation or travel

7. Working Hours and Days: Standard working hours, days, and overtime arrangements as per Saudi Labor Law

8. Probation Period: Duration and terms of the probation period (maximum 90 days under Saudi law)

9. Compensation and Benefits: Base salary, allowances, and mandatory benefits

10. Annual Leave: Annual leave entitlement and calculation as per Saudi Labor Law

11. Sick Leave: Sick leave entitlement and procedures

12. Confidentiality and Non-Disclosure: Protection of company confidential information

13. Termination: Grounds and procedures for contract termination

14. End of Service Benefits: Calculation and payment of end of service benefits

15. Governing Law: Confirmation of Saudi Law application and jurisdiction

What sections are optional to include in a Definite Employment Contract?

1. Non-Compete Clause: Restrictions on post-employment competition (used for senior positions or technical roles)

2. Intellectual Property Rights: IP ownership and assignment (used for creative or technical positions)

3. Commission Structure: Details of commission calculations and payments (used for sales positions)

4. Remote Work Provisions: Terms and conditions for remote work arrangements

5. International Assignment Terms: Additional terms for expatriate employees

6. Variable Pay and Bonuses: Structure and conditions for variable compensation

7. Training Obligations: Mandatory training requirements and associated commitments

8. Housing Allowance Terms: Specific terms related to housing benefits

What schedules should be included in a Definite Employment Contract?

1. Schedule 1 - Detailed Job Description: Comprehensive list of duties, responsibilities, and performance expectations

2. Schedule 2 - Compensation Structure: Detailed breakdown of salary components and benefits

3. Schedule 3 - Company Policies: Key company policies that form part of the employment terms

4. Schedule 4 - Code of Conduct: Expected behavioral standards and ethical guidelines

5. Appendix A - Benefits Summary: Detailed description of all benefits and eligibility criteria

6. Appendix B - Required Documents: List of documents required for employment and visa purposes

Authors

Alex Denne

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

Jurisdiction

Saudi Arabia

Publisher

Ƶ

Document Type

Employment Contract

Cost

Free to use
Relevant legal definitions




































Clauses








































Relevant Industries

Technology

Manufacturing

Construction

Healthcare

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Retail

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Relevant Teams

Human Resources

Legal

Finance

Operations

Information Technology

Sales

Marketing

Customer Service

Research and Development

Quality Assurance

Administration

Business Development

Project Management Office

Relevant Roles

Project Manager

Software Engineer

Administrative Assistant

Sales Representative

Financial Analyst

HR Coordinator

Operations Manager

Marketing Specialist

Research Analyst

Technical Consultant

Customer Service Representative

Business Development Manager

Account Executive

Site Engineer

Medical Professional

Teacher/Instructor

Legal Advisor

Quality Control Specialist

Industries







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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