Article 107 Saudi Labor Law specifies that while employment contracts set agreed working hours, employees may sometimes be required to work extra hours, and this article defines how their pay for these additional hours is calculated.
It also clarifies that all work performed during official holidays or public holidays counts as overtime, and rest periods are not included in working hours. Given the importance of this topic and its prevalence among workers, this article provides a detailed explanation of Article 107, highlighting workers’ rights and their legal entitlements.
المحتويات
Article 107 Saudi Labor Law
The Saudi legislator specified in Article 107 of the Labor Law the wages for overtime work to protect employees’ rights and ensure they are not exploited or deprived of their entitlements. The article states the following:
- The employer must pay the employee an additional wage for each hour of overtime, calculated as the actual hourly wage plus 50% of the employee’s basic salary.
- If the work follows a weekly standard, any hours exceeding the set weekly limit are considered overtime.
- All working hours that fall on official holidays or public holidays are counted as overtime.
It is worth noting that the labor law in Saudi Arabia stipulates that daily working hours should not exceed 8 hours if the work is based on a daily standard, and should not exceed 48 hours per week if based on a weekly standard. Therefore, any work beyond these limits is classified as overtime according to Article 107 of the Saudi Labor Law 2025.
Read also: Unpaid Leave in Saudi Arabia: When You Can Take It?
Explanation of Article 107 Saudi Labor Law
Article 107 Saudi Labor Law clearly defines the compensation for overtime work. However, some people may apply it incorrectly, believing that the overtime hour is equal to one and a half times the basic hourly wage, which contradicts the provisions of the article.
To avoid this mistake, it is important to distinguish between basic wage and actual wage:
- Basic wage: The amount paid to the employee for their work according to the employment contract.
- Actual wage: Includes the basic wage plus all additional entitlements, such as allowances, grants, commissions, and bonuses.
Article 107 also specifies that all hours worked by the employee during official holidays and public holidays are considered overtime hours. For example, if an employee works ten hours on a public holiday, all these hours are counted as overtime, even if the standard daily working hours are 8 hours.
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How to Calculate Overtime Hours?
According to Article 107 Saudi Labor Law, overtime hours are calculated based on the employee’s actual and basic salary. An overtime hour is calculated as one hour of the actual wage plus 50% of the basic hourly wage.
To illustrate the calculation method, consider the following example:
Suppose an employee works 9 hours a day, with a basic salary of SAR 6,000 and an actual salary of SAR 7,500, and worked 12 overtime hours in a given month. The calculation is as follows:
- Hourly wage based on the basic salary:
(6,000 ÷ 30) ÷ 9 = SAR 22.2 - Hourly wage based on the actual salary:
(7,500 ÷ 30) ÷ 9 = SAR 27.8 - Overtime hourly wage:
27.8 + (22.2 × 50%) = SAR 38.9 - Pay for 12 overtime hours:
38.9 × 12 = SAR 466.8
This method ensures that employees receive their rightful compensation for overtime hours according to the legal regulations in Saudi Arabia.
Are Rest Hours Counted as Working Hours?
Many people wonder whether rest hours granted to an employee are included in the actual working hours. The answer is no; rest hours are not counted as working hours because during this time the employee is not under the supervision or control of the employer.
In conclusion, Article 107 of the Saudi Labor Law is one of the most important provisions that safeguard the rights of employees working overtime. This article provided a detailed explanation of how to calculate overtime pay.
If you need any legal consultation regarding this matter, you can contact Etqan Law Firm for specialized legal support.
Learn about: Penalty for Breaking Employment Contract in Saudi Arabia: Legal Consequences
Conclusion
Article 107 Saudi Labor Law is a cornerstone for protecting employees’ rights and ensuring they receive proper compensation for overtime work. This article clearly explains how overtime pay should be calculated fairly and legally, taking into account both the basic and actual wages, as well as hours worked during official holidays. For any specialized legal consultation, you can contact the team at Etqan Law Firm for professional legal support in this field.
The Etqan Al Mutamayza Law Firm is ready to provide the essential support you need. You can reach their team at the following mobile numbers: +966550600204, +966551020060.
Additionally, feel free to visit our branches located at:
- Jeddah: Al-Aziziyah District, Mohammed bin Abdulaziz Street (Tahlia)
- Riyadh: King Abdulaziz Street, across from the Kingdom Tower
- Dammam: Al-Ashri’a Street, Al-Badeea, Dammam 32415.
FAQ
1- Can I resign during the probation period in Saudi Arabia?
Yes, an employee can resign during the probation period. Usually, only a short notice is required, often a few days to a week.
2- What is a valid reason for termination of employment in Saudi Arabia?
Legitimate reasons for terminating an employment contract in Saudi Arabia include statutory cases such as the expiration of a fixed-term contract, mutual agreement between the parties, reaching retirement age, the cessation of the business activity, force majeure, or the permanent closure of the establishment. Termination may also occur due to the employee’s violation of labor regulations, such as failing to perform duties, misconduct, repeated absences, or submitting falsified documents to obtain the job.
3- What is the maximum notice period in Saudi Arabia?
The maximum notice period allowed by Saudi labor law is 60 days for both employers and employees, unless otherwise agreed in the contract.