An employment contract is the written agreement between a company and an employee that sets out the job, salary, term, working hours, leave and how the contract ends. Answer four questions in the employment contract template above to draft a fixed-term or open-ended contract with its clauses, then edit the wording and download it for review and signing before it is documented.
Choose the contract type, enter the parties, the job and the salary, then probation, hours and leave. In the Advanced mode example: basic salary SAR 10,000, housing 2,500 and transport 1,000, so the salary clause states SAR 13,500.00 in figures and words. The contract is documented officially on Qiwa.
How to use the employment contract template
- Choose the contract type: open-ended, or fixed for one, two or three years.
- Enter the company, the employee, the job title, the start date and the salary.
- In Advanced mode, add allowances, probation, working hours, leave, notice period and the registration and ID details.
- Review the clauses in the generated contract, edit the wording directly, then download it in Word for review or as a PDF to sign.
Types of employment contract in Saudi Arabia
Private-sector employment contracts come in three common types: open-ended, which runs until either party ends it with notice; fixed-term, which ends when its term ends unless renewed; and part-time, for fewer hours than a full working week. A company hiring for a project with a known end date suits a fixed-term contract, while one building a permanent team suits an open-ended one. Expatriate workers have specific rules on contract term and work permits under the Labor Law.
Employment contracts are not commercial contracts. Supply agreements, commercial agency, franchise, partnership and subcontracting are agreements between independent businesses governed by civil and commercial law, not the Labor Law. They carry no salary, leave or end-of-service award, and this template does not fit them.
Essential clauses of an employment contract
The template's clauses: the parties, the position and place of work, term and start date in Hijri and Gregorian, probation, salary and allowances, working hours, leave, termination and notice, end-of-service award, and governing law. State explicitly whatever differs from one employee to the next: salary and its breakdown, term, probation and notice. Refer to the Labor Law for what applies to everyone, such as maximum working hours and the award calculation. A sample salary clause from the template: "The employee receives a total monthly salary of SAR 13,500.00, paid at the end of each Gregorian month by bank transfer, made up of: basic salary 10,000, housing allowance 2,500 and transport allowance 1,000."
Documenting the contract on Qiwa
Private-sector contracts are documented through the unified contract on Qiwa, the Ministry of Human Resources platform: the company enters the employee's details, job, salary and term, and the employee approves online. Keep the template's details identical to what you enter on the platform, especially basic salary, allowances and term, because the platform is the official record. This template is a draft both sides agree on and a reference for extra clauses. The platform's steps change, so check its official guide when you do it.
Part-time contract versus freelance agreement
A part-time contract is a full employment relationship for fewer hours: the employee works under the company's direction and is entitled to pay and rights under the Labor Law in proportion to their hours. A freelance agreement is for a task or service from an independent person working on their own account, with no direction, fixed hours, leave or end-of-service award. Part-time suits someone you need on a fixed schedule under your supervision; freelance suits buying a defined result. Do not call a real employment relationship a freelance contract: if the person works set hours under your management, it is employment with its rights whatever the contract is called. The job offer letter and the acceptance letter each have their own page.
Common employment contract mistakes
- Salary or allowances in the signed draft that differ from the contract documented on Qiwa.
- A probation period longer than the Labor Law allows.
- An unclear contract term, leading to a dispute when the contract ends.
- Using an employment contract for a commercial relationship, or a freelance agreement for employment.
Regulatory notes
The maximum probation period is in Article 53, working hours in Article 98, annual leave in Article 109, notice in Article 75, compensation for ending a fixed-term contract in Article 77, and the end-of-service award in Article 84 of the Saudi Labor Law. Several of these articles were amended recently, so check the current texts with the Ministry of Human Resources and Social Development and have the contract reviewed by a legal adviser before you rely on it.
When hiring picks up and contracts scatter
Microtec's ERP accounting system includes an HR module that keeps each employee's records in one place, from hiring to the end of service.
Frequently asked questions
Does an employment contract have to be in writing?
In practice yes: private-sector contracts are documented through the unified contract on Qiwa. A written contract protects both sides in any dispute over salary, term or notice.
Can I use the same contract for Saudi and expatriate staff?
The core clauses are the same; add the nationality and Iqama number for an expatriate and follow the Labor Law's rules on their contract term and work permit. Enter them in Advanced mode.
What do I do after the contract is signed?
Enter the same terms on Qiwa for the employee to approve, keep a signed copy in their file, then register them with GOSI and add them to the payroll from the start date.
What happens when a fixed-term contract ends and is not renewed?
It ends when its term ends. If both sides carry on working without a written renewal, the contract may be treated as renewed or open-ended under the Labor Law; check the current text and put any renewal in writing.