HR and Labour Compliance in Saudi Arabia: Qiwa, Developed Nitaqat, Mudad and GOSI Guide

Introduction

Human resources management in newly established companies in Saudi Arabia is governed by an interconnected digital system supervised by the Ministry of Human Resources and Social Development and the General Organization for Social Insurance. Staying compliant with this system is what allows you to obtain work visas and recruit international talent without setbacks.

1. The “Developed Nitaqat” Programme and Saudization Rules

• Programme concept: It classifies establishments into colour bands (red, low green, medium green, high green, platinum) according to the Saudization rate achieved, the establishment’s activity and its total number of employees.
• Exemption for micro and small establishments (Category A):
  • Establishments whose total workforce is (1 to 5 workers) or (up to 9 workers):
  • Are exempt from Saudization quotas and are granted the small green band, provided that the owner of the establishment (or one of the registered Saudi partners) works full-time in and manages it and is registered with GOSI as a full-time establishment owner.
  • For 100% foreign companies: once non-Saudi staff beyond the General Manager are recruited, the establishment must enter the Saudization equation and hire Saudi nationals to maintain the high green band for issuing visas and renewing work permits.
• Counting a Saudi employee: A Saudi employee counts as one full employee towards your Saudization rate only if their monthly wage registered with GOSI is at least SAR 4,000. A wage below SAR 3,000 does not count at all, and a wage between SAR 3,000 and SAR 4,000 counts as half an employee (0.5).

2. The “Qiwa” Platform (Qiwa.sa): The Backbone of Labour Management

• Definition: The exclusive official digital platform for all Ministry of Human Resources and Social Development transactions for establishments.
• Annual subscription: A mandatory annual subscription that varies according to the number of registered employees (starting from around SAR 1,265 for micro and small establishments and rising with the size of the establishment to exceed SAR 7,000 for large establishments).
• Mandatory services carried out exclusively through Qiwa:
  1. Issuing and renewing work permits: The government fee for a work permit is SAR 9,600 per year for each expatriate employee in excess of the number of Saudis (SAR 800 per month as the expat levy), or SAR 8,400 per year where the number of expatriates equals the number of Saudis.
  2. Electronic contract authentication: A regulatory obligation to upload and authenticate the contracts of all employees (Saudis and expatriates) electronically through Qiwa. An establishment that does not authenticate its contracts is deprived of services, and its workers may transfer their sponsorship without its consent.
  3. Internal work regulations: Establishments must adopt electronic work regulations (standard or customised) through Qiwa to govern leave and disciplinary policies.
  4. Transfer of services (sponsorship transfer) and issuance of instant professional visas.

3. The “Mudad” Platform (Mudad.com.sa) and the Wage Protection System (WPS)

• Purpose: Real-time monitoring of private-sector salary payments through a direct link between banks and the Ministry of Human Resources.
• Mandatory obligation:
  • Every company must upload its monthly payroll file in the approved bank format and pass it through the Mudad platform.
  • Compliance rate: The monthly wage protection compliance rate must not fall below 80% of the total workforce to avoid fines and suspension of iqama renewals.
  • Instant detection of violations such as late salaries or irregular deductions.

4. General Organization for Social Insurance (GOSI)

• Registration: The establishment’s GOSI account is opened automatically once the Commercial Registration is issued through the Saudi Business Center.
• Approved monthly contribution rates (2026):
  • Saudi employee:
    • Employer’s share: 11.75% of the registered wage (covering pensions, occupational hazards and the SANED unemployment insurance).
    • Employee’s share (deducted from salary): 9.75% of the registered wage.
    • Total contribution for a Saudi national: 21.5%.
  • Non-Saudi (expatriate) employee:
    • Employer’s share only: 2% to cover the occupational hazards branch (work injuries).
    • Deduction from the non-Saudi employee: 0% (expatriate employees pay no GOSI deduction).