🇸🇦 Labor & Contracting Compliance
BayanCore incorporates the statutory mandates of the Ministry of Human Resources and Social Development (MHRSD) and the General Organization for Social Insurance (GOSI) into its Human Resource Management System (HRMS) core.
1. Employment Contract Management
Employment contracts must align with standard MHRSD Qiwa configurations:
- Bilingual Mandate: Employment contracts are generated in parallel Arabic and English. Under Saudi law, the Arabic text takes precedence in legal disputes.
- Contract Lifecycles: The system supports both fixed-term (common for expats) and indefinite contracts (for Saudi nationals), tracking probation periods (max 90 days, extendable to 180 days with written consent).
- Alert Notifications: System workflows generate alerts 60 days before a fixed-term contract expires, initiating the renewal or termination workflows in accordance with Labor Law provisions.
2. GOSI Contribution Calculations
The GOSI payroll deduction engine dynamically calculates social insurance contributions during monthly payroll processing.
Contribution Rates
| Employee Nationality | Category | Employee Share | Employer Share | Total Contribution |
|---|---|---|---|---|
| Saudi Nationals | Pensions, Unemployment (SANED), Hazards | 9.75% | 11.75% | 21.5% |
| GCC Nationals | Mapped to home country social insurance | Varies by country | Varies by country | Variable |
| Expat Employees | Occupational Hazards only | 0% | 2.0% | 2.0% |
Salary Cap
- Contributions are calculated on the employee's Basic Salary + Housing Allowance.
- The maximum salary subject to GOSI deductions is SAR 45,000 per month.
3. Saudization (Nitaqat) & Qiwa Integration
The Nitaqat Saudization Program classifies establishments into zones (Platinum, Green, Yellow, Red) based on their Saudi employment percentage and company size category.
- Real-Time Dashboard: Displays the active Saudization ratio, predicting the Nitaqat zone category.
- Expat Visa Blocks: If a company falls into Yellow or Red zones, the system flags the HR interface warning that work permit renewals, visa issuances, and employee transfers on Qiwa will be blocked by MHRSD.
- GOSI Cross-Check: To prevent compliance discrepancies, the HRMS verifies that the company's active Saudi employee count in the payroll module matches the active registration count pulled from the GOSI API.
4. End-of-Service Benefit (EOSB) Calculations
Saudi Labor Law dictates that employees are entitled to a gratuity upon contract termination, calculated on their final basic salary.
Gratuity Calculation Rules
- Standard Accrual Rate:
- First 5 Years of Service: Half-month's salary per year.
- Subsequent Years of Service: One full month's salary per year.
- Impact of Employee Resignation:
- Service < 2 Years: No EOSB entitlement.
- Service 2 to 5 Years: Employee receives $\frac13$ of the accrued EOSB.
- Service 5 to 10 Years: Employee receives $\frac23$ of the accrued EOSB.
- Service > 10 Years (or contract termination by employer): Employee receives 100% of the accrued EOSB.
- Programmatic Ledger Accrual: The system auto-calculates and posts monthly EOSB accrual values to the balance sheet liability accounts, ensuring accurate monthly profitability reporting.