News

? New Updates in the Saudi Social Insurance System The General Organization for Social Insurance (GOSI) has announced new amendments to the Social Insurance Law aimed at enhancing financial sustainability and improving the benefits provided to contributors. These updates include a gradual increase in the contribution rate for the pensions branch, as well as the introduction of a new maternity compensation for working women. Below are the key details of these amendments: ? First: Increase in Pension Contribution Rates This increase applies to contributors who had not previously enrolled in the system before July 3, 2024. The contribution rate for the pensions branch will be gradually increased by 0.5% annually, shared equally between the employee and the employer, while contribution rates for other branches remain unchanged. ? New Contribution Rate Details: Year Employer Contribution (Pensions) Employee Contribution (Pensions) Total Employer Deduction Total Employee Deduction Increase Rate July 3, 2024 9% 9% 11.75% 9.75% No increase July 1, 2025 9.5% 9.5% 12.25% 10.25% 0.5% July 1, 2026 10% 10% 12.75% 10.75% 0.5% July 1, 2027 10.5% 10.5% 13.25% 11.25% 0.5% July 1, 2028 11% 11% 13.75% 11.75% 0.5% ? Second: Maternity Compensation As part of the new amendments, GOSI has introduced a new benefit called “Maternity Compensation”, which is provided to working women who take time off due to childbirth — whether Saudi or non-Saudi — provided they are registered contributors. ? Eligibility and Payment Mechanism: Eligibility starts from the first month in which childbirth occurs. The maternity compensation equals the average recorded monthly wage over the last 3 months. The duration extends to 4 months if the baby is ill or has a disability. To qualify, the female worker must have completed 12 months of contributions (continuous or non-continuous) during the last 36 months prior to childbirth. The childbirth must occur while the worker is under an active subscription and at least 6 months after the start of pregnancy, regardless of whether the baby is born alive or not. It is not permitted to combine maternity compensation with a regular salary, but it can be combined with occupational hazard compensation. Social insurance contributions will continue during the compensation period, as is currently the case under the occupational hazard branch. ? Note: Eligible participants can apply for maternity compensation easily through the GOSI electronic platform, uploading all required documents online without the need to visit a branch.

? First: Resignation and Its Conditions Previously, the Labor Law only addressed resignation in open-ended contracts. Now, the law introduces a clear definition of resignation and its conditions. Resignation is defined as: The employee’s written expression of their desire to terminate a fixed-term employment contract voluntarily, without coercion or condition, with the employer’s approval. Details of the Amendments: The resignation is automatically accepted if 30 days pass after submission without a response from the employer. The employer may postpone acceptance of the resignation for up to 60 days if required for business needs, provided the reason is given in writing before the end of the 30-day period. The employment contract ends in any of the following cases: When the employer accepts the resignation. After 30 days with no response. At the end of the approved postponement period. The employee may withdraw their resignation within 7 days of submission, provided the employer has not yet accepted it. The contract remains in effect during the resignation period, and both parties must continue to fulfill their obligations. Employees who resign are entitled to all legal rights as per the Labor Law. ? Second: Contracts for Non-Saudis Previously, the work permit would replace the employment contract upon its expiration. Under the new amendment, this rule has been abolished. The new regulation states that: If the employment contract expires and both parties continue to perform their duties, the contract is automatically renewed for the same duration and under the same terms. ? Third: Probation Period Previously, the probation period was 90 days, extendable to 180 days with the employee’s written consent, excluding official and sick leaves. Under the new regulation: The probation period must be clearly stated in the contract and must not exceed 180 days in total (excluding official holidays). Either party has the right to terminate the contract during the probation period, without discrimination or bias toward either side. ? Fourth: Allowances and Wage Details One of the key changes is that the new law requires employers to provide housing and transportation or pay cash allowances as part of the monthly salary. Previously, these allowances were optional, not mandatory. ? Fifth: Leave Updates (Bereavement Leave) The leave provisions have been updated to include siblings (brother and sister) in the bereavement leave entitlement. The new provision grants the employee the right to: 5 days with full pay in the event of marriage, or the death of a spouse, parent, or child. 3 days with full pay in the event of the death of a brother or sister. 3 days upon the birth of a child, within 7 days from the date of birth. The employer has the right to request supporting documents to verify the case.

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