Overtime and bonus rules in Saudi Arabia are governed by distinct provisions under the Labour Law, important for both employees and employers to understand. Under Article 107, overtime pay equals the hourly wage plus 50% of the basic wage, and this also applies to hours worked on holidays. The implementing regulations cap overtime at 720 additional hours annually, though this can be raised with the worker’s consent.
Bonuses, by contrast, are more flexible, with no fixed amount mandated by law. Saudi regulations allow an establishment to grant annual bonuses based on its financial position, rather than requiring a set payment for every employee. Exceptional bonuses may also be given at the employer’s discretion, making bonus payments largely optional compared to mandatory overtime pay.
The key distinction: overtime and bonus rules in Saudi Arabia treat overtime pay as a statutory obligation once qualifying hours are worked, while an annual bonus is not automatically guaranteed. This guide covers how to calculate overtime, rules on Fridays, holidays, and Ramadan, compensatory leave, bonus treatment, and what to do if overtime goes unpaid.
Does Overtime Use Basic Salary or Gross Salary?
The distinction between basic salary and the wider actual wage is important.
Saudi HRSD defines basic wage and actual wage separately. The Ministry’s definitions state that basic wage includes the amounts given to the worker in return for work under the employment contract, including periodic increases, while actual wage includes basic wage plus other increases and qualifying payments. The Ministry’s definition of actual wage can include commissions, certain allowances, and bonuses when they meet the stated conditions.
Article 107 specifically refers to the hourly wage plus 50% of basic wage.
Therefore, employees should not automatically assume that every allowance in their monthly compensation package is part of the overtime calculation.
The actual employment contract and applicable wage definitions should be examined when calculating a disputed overtime amount.
Is Saudi Overtime Paid at 1.5 Times Salary?
Under Article 107, overtime compensation is the hourly wage plus 50% of the basic wage. In the standard calculation based on the hourly basic wage, this is expressed as 1.5 times the hourly rate. HRSD’s official English guidance states that the employer must pay the worker an additional wage equivalent to the hourly wage plus 50% of basic wage.
Therefore, the statutory calculation should not be described as 2× the normal hourly wage.
The Global Law Experts article also emphasizes this point, explaining that the legal overtime rate is 1.5× rather than 2× or 2.5×.
An employer may provide contractual benefits above the statutory requirement where applicable, but that does not change the statutory Article 107 baseline.
Overtime & Bonus Rules in Saudi Arabia – Quick Overview
| Topic | Saudi Arabia Rule |
| Normal maximum working hours | 8 hours/day or 48 hours/week |
| Ramadan working hours for Muslim workers | 6 hours/day or 36 hours/week |
| Overtime compensation | Hourly wage + 50% of basic wage |
| Effective overtime multiplier in the standard calculation | 1.5× |
| Work on official holidays | Treated as overtime |
| Work on weekly rest days | Treated as overtime under Article 107 |
| Annual additional working hours | Normally 720 hours |
| Can the annual limit be exceeded? | The regulations allow additional hours with worker consent |
| Compensatory paid leave instead of overtime pay | Permitted with worker consent |
| Annual bonus | May be granted according to applicable rules |
| Fixed universal annual bonus amount | Not established by the implementing regulation |
| Overtime calculation base | Based on the applicable hourly wage/basic wage rules |
| Salary payment | Must follow applicable wage-payment requirements |
The overtime provisions are set out in Article 107 and related implementing regulations, while the Ministry also publishes guidance explaining the overtime calculation.
What Is Overtime Under Saudi Labor Law?
Overtime generally refers to qualifying work performed beyond the normal working-hour standard established by Saudi labour law.
Article 98 establishes the ordinary maximum working standard at eight actual working hours per day when the daily standard is used, or 48 hours per week when the weekly standard is used. During Ramadan, actual working hours for Muslim workers are reduced to six hours per day or 36 hours per week.
When the applicable working-hour standard is exceeded, the additional hours can constitute overtime.
Article 107 specifically provides that the employer must pay additional compensation for overtime. HRSD’s official guidance describes the payment as the hourly wage plus 50% of the basic wage.
The law also states that all working hours performed during holidays and official vacations are considered overtime hours.
Therefore, overtime is not simply an informal payment that an employer can choose to provide. Where the employee is covered by the overtime provisions and qualifying additional hours are worked, the law establishes additional compensation.
What About Housing and Transport Allowances?
Housing, transportation, food, commissions, and other allowances may form part of an employee’s overall compensation package, but their treatment in an overtime calculation should not simply be assumed.
The key statutory wording in Article 107 refers to the hourly wage plus 50% of basic wage.
HRSD’s definitions also distinguish basic wage from actual wage and identify different categories of compensation.
For this reason, an employee with a monthly package of SAR 8,000 cannot automatically calculate overtime as though the entire SAR 8,000 were basic salary.
The employee should identify the basic wage recorded in the employment contract and applicable employment documentation.
Is Holiday Overtime Double Pay?
The statutory Article 107 calculation is not automatically double pay.
The standard rule is the hourly wage plus 50% of basic wage, which is generally expressed as a 1.5× calculation when the hourly wage is derived from basic salary.
An employer may have contractual or internal terms that provide a higher payment where applicable, but the statutory rule itself should not be described as an automatic 2× entitlement.
Therefore:
Statutory overtime calculation: 1.5× in the standard basic-hourly calculation.
Double-time: not the standard Article 107 statutory formula.
Maximum Overtime Hours in Saudi Arabia
Saudi Arabia’s implementing regulations establish a limit on additional working hours.
HRSD states that additional working hours during the year may not exceed 720 hours, with the possibility of exceeding that amount with the worker’s consent.
The Global Law Experts article also identifies 720 hours as the annual cap and explains the consent mechanism.
This means the annual overtime limit should not be interpreted as an unlimited ability for an employer to require overtime throughout the year.
The rules establish a normal annual ceiling and provide a mechanism for additional hours when the applicable conditions are satisfied.
Can an Employee Work More Than 720 Overtime Hours?
The HRSD guidance states that additional working hours may not exceed 720 hours per year, and that it is permissible, with the worker’s consent, to increase the number of additional hours beyond that amount.
Therefore, the more precise explanation is:
720 hours is the normal annual limit, but the regulations provide for an increase when the worker consents.
This is different from saying that employers are always limited to exactly 720 hours regardless of circumstances.
Compensatory Leave Instead of Overtime Pay
Article 107 also allows an alternative to direct overtime payment.
The employer may, with the worker’s consent, calculate paid compensatory leave days instead of the wages due for overtime hours.
This means an employer cannot simply assume that it can replace overtime wages with time off without considering the statutory consent requirement.
The Global Law Experts article similarly explains that compensatory time off may be used in place of overtime pay when the employee agrees.
For an employee, the important point is that overtime compensation and compensatory leave are not automatically interchangeable at the employer’s unilateral choice.
Ramadan Overtime Rules
Saudi Arabia’s working-hour rules change during Ramadan for Muslim employees.
Article 98 provides that actual working hours for Muslim workers during Ramadan are reduced to six hours per day or 36 hours per week.
This reduction is important when determining whether additional hours have been worked.
For example, if a Muslim employee is subject to the six-hour Ramadan standard and works qualifying hours beyond the applicable limit, those additional hours may constitute overtime.
The Global Law Experts article explains that hours worked beyond the applicable Ramadan standard are treated as overtime under Article 107.
The exact work schedule should nevertheless be considered because employers may organize working hours under the permitted arrangements.
Night Shift and Overtime Pay
Saudi Labour Law does not establish a universal additional night-shift premium above the Article 107 overtime rate simply because work occurs at night.
The Global Law Experts article notes that contracts or sector-specific arrangements may provide different treatment for night work.
Therefore, employees should distinguish between:
- Regular night work under the employee’s normal schedule.
- Overtime performed during a night shift.
- Any contractual night-shift allowance.
- Sector-specific employment rules.
If night work is itself within the employee’s normal working hours, it should not automatically be described as overtime merely because it occurs at night.
If the hours qualify as overtime, Article 107 applies.
Annual Bonus Rules in Saudi Arabia
Bonus rules are different from overtime rules.
The Saudi implementing regulations provide that an establishment may grant annual bonuses, and the bonus can be determined in light of the establishment’s financial position. The regulation also states that a worker may be eligible for a bonus after meeting the applicable performance and service conditions described in the establishment’s system. An exceptional bonus may also be granted according to the employer’s controls.
This means there is not one universal statutory annual bonus amount that every Saudi employee must receive.
A bonus can depend on:
- The employer’s bonus system.
- The establishment’s financial position.
- The worker’s performance.
- The applicable employment rules.
- The employment contract or work regulations where relevant.
Therefore, it would be incorrect to state that every employee in Saudi Arabia is legally entitled to a fixed 13th-month salary or a universal annual bonus percentage.
Is Annual Bonus Mandatory in Saudi Arabia?
The implementing regulation uses the wording that an establishment may grant annual bonuses, rather than establishing one fixed bonus that must be paid to every worker regardless of circumstances.
Therefore, there is no universal statutory annual bonus percentage equivalent to the overtime requirement.
However, the treatment can become different when a bonus is expressly incorporated into an employment contract, establishment regulations, or has become an established customary component of wages.
HRSD’s definitions explain that a grant or bonus can form part of wages where it is established in the employment contract, establishment work regulations, or regularly paid as a customary practice such that workers regard it as part of their wages rather than as a voluntary gift.
This contractual and customary distinction is important in bonus disputes.
Contractual Bonus vs Discretionary Bonus
Not every payment called a “bonus” has exactly the same legal treatment.
A bonus may be described in company rules as discretionary and dependent on financial performance or management decisions.
Another bonus may be expressly promised in the employment contract.
The Ministry’s definition specifically recognizes a grant or bonus as part of wages when it is established in the employment contract, establishment work regulations, or has become customary in the workplace under the stated conditions.
Therefore, an employee who is asking whether a bonus is legally owed should review:
- The employment contract.
- The company’s work regulations.
- The bonus policy.
- Previous bonus payments.
- Any written communications concerning eligibility.
- The conditions attached to the bonus.
Simply calling a payment a “bonus” does not by itself answer whether it is legally guaranteed.
Overtime vs Bonus: What Is the Difference?
The two concepts should not be confused.
| Overtime | Bonus |
| Connected to qualifying additional working hours | Generally connected to employer bonus arrangements |
| Article 107 establishes overtime compensation | Implementing regulations allow annual bonuses under stated conditions |
| Standard calculation uses hourly wage + 50% of basic wage | No single universal bonus percentage |
| Public-holiday working hours are treated as overtime | Bonus may depend on company rules and conditions |
| Annual additional-hours limit applies | No equivalent universal annual bonus-hour limit |
| Compensatory paid leave can replace overtime pay with worker consent | Bonus eligibility depends on applicable arrangements |
The statutory treatment of overtime is therefore more specific than the general treatment of annual bonuses.
Salary Payment Rules in Saudi Arabia
Saudi Arabia also regulates how wages are paid.
HRSD states that wages must be paid in the official currency of the Kingdom and that wage entitlement dates must be observed according to the applicable and agreed payment dates. The Ministry also states that wages must be paid through approved banks in Saudi Arabia.
This is relevant to overtime because overtime is part of the employee’s wage entitlement where qualifying overtime has been worked.
An employee should therefore keep salary statements, bank records, attendance information, and overtime records where there is a disagreement over payment.
What If an Employer Does Not Pay Overtime?
If an employee believes that qualifying overtime has not been paid, the first practical step can be to check the employment contract, attendance records, salary records, and applicable company rules.
The employee can then raise the issue with the employer or HR department in writing.
If the matter is not resolved, the employee may use the applicable labour-dispute mechanisms.
The Global Law Experts article describes an escalation process beginning with internal resolution and then moving to HRSD and, where necessary, labour tribunals.
The exact procedure, required documents, deadlines, and available remedies can depend on the circumstances of the dispute.
Documents Needed for an Overtime Dispute
A worker preparing an overtime claim may want to organize the evidence into a simple file.
A useful calculation table can contain:
| Date | Normal Hours | Actual Hours | Overtime Hours | OT Rate | OT Amount |
| Day 1 | 8 | 10 | 2 | Applicable rate | Calculated amount |
| Day 2 | 8 | 11 | 3 | Applicable rate | Calculated amount |
| Day 3 | 8 | 8 | 0 | — | — |
The purpose of such a table is to show exactly how the claimed amount was calculated.
Employees should retain original documents and avoid altering records.
Overtime Calculation Table by Basic Salary
The following examples use the standard 30-day and 8-hour calculation for illustration.
| Basic Salary | Approx. Hourly Rate | Approx. OT Rate (1.5×) |
| SAR 3,000 | SAR 12.50 | SAR 18.75 |
| SAR 4,000 | SAR 16.67 | SAR 25.00 |
| SAR 5,000 | SAR 20.83 | SAR 31.25 |
| SAR 6,000 | SAR 25.00 | SAR 37.50 |
| SAR 7,000 | SAR 29.17 | SAR 43.75 |
| SAR 8,000 | SAR 33.33 | SAR 50.00 |
| SAR 10,000 | SAR 41.67 | SAR 62.50 |
These are mathematical examples using the standard calculation method. They are not salary recommendations or guaranteed employee rates.
Overtime Pay for 10 Hours
Using the examples above:
| Basic Salary | Approx. OT Rate | 10 Hours OT |
| SAR 3,000 | SAR 18.75 | SAR 187.50 |
| SAR 4,000 | SAR 25.00 | SAR 250 |
| SAR 5,000 | SAR 31.25 | SAR 312.50 |
| SAR 6,000 | SAR 37.50 | SAR 375 |
| SAR 7,000 | SAR 43.75 | SAR 437.50 |
| SAR 8,000 | SAR 50.00 | SAR 500 |
| SAR 10,000 | SAR 62.50 | SAR 625 |
The actual entitlement depends on whether the hours qualify as overtime and on the applicable contractual and legal circumstances.
Overtime Pay for 20 Hours
| Basic Salary | Approx. OT Rate | 20 Hours OT |
| SAR 3,000 | SAR 18.75 | SAR 375 |
| SAR 4,000 | SAR 25.00 | SAR 500 |
| SAR 5,000 | SAR 31.25 | SAR 625 |
| SAR 6,000 | SAR 37.50 | SAR 750 |
| SAR 7,000 | SAR 43.75 | SAR 875 |
| SAR 8,000 | SAR 50.00 | SAR 1,000 |
| SAR 10,000 | SAR 62.50 | SAR 1,250 |
These figures show why an employee’s basic salary is important when calculating overtime.
Overtime and Monthly Salary Example
Consider an employee whose:
- Basic salary = SAR 6,000
- Overtime = 20 hours
- Standard calculation = SAR 37.50 per overtime hour
The overtime amount would be:
SAR 37.50 × 20 = SAR 750
The employee’s basic salary remains SAR 6,000, while the calculated overtime compensation is SAR 750.
The total of these two components would therefore be SAR 6,750 before considering other salary components, deductions, allowances, or other payments.
This example is purely a calculation illustration.
Overtime and Bonus in the Same Month
Overtime and bonus payments should be kept conceptually separate.
For example, an employee may receive:
- Basic salary
- Allowances
- Overtime compensation
- A contractual or employer-approved bonus
The fact that an employee receives a bonus does not automatically eliminate an overtime entitlement.
Likewise, qualifying overtime does not automatically create a separate annual bonus entitlement.
Each payment should be considered under the applicable legal and contractual basis.
Are Bonuses Included in Overtime?
The answer should not be generalized without examining the nature of the payment.
Saudi HRSD distinguishes between basic wage, actual wage, and bonuses. A bonus can become part of wages where it is established under the employment contract, establishment regulations, or regular customary practice under the Ministry’s definition.
Article 107, however, establishes overtime compensation using the hourly wage and 50% of basic wage.
Therefore, an employee should examine the specific classification and contractual treatment of a bonus before including it in an overtime calculation.
What Employers Should Record
Employers should maintain appropriate records relating to working hours and wage payments.
For employees, useful documentation includes:
- Employment contracts.
- Work schedules.
- Attendance records.
- Overtime approvals.
- Payroll statements.
- Overtime payment records.
- Holiday work records.
- Weekly rest-day schedules.
- Bonus policies.
- Performance records where bonuses are performance-based.
Accurate records help both sides determine whether the employee’s overtime and other wage entitlements have been correctly calculated.
Overtime Rules for Expatriate Workers
The Article 107 overtime rule is not described by HRSD as a benefit restricted to Saudi nationals.
The Global Law Experts article specifically explains the overtime rules in the context of both Saudi nationals and expatriate employees covered by the Labour Law.
Therefore, expatriate workers covered by the applicable Saudi Labour Law provisions should not assume that they lose overtime rights simply because they are foreign workers.
However, the exact legal coverage of an individual employee can depend on the worker’s employment category and applicable exclusions.
Are All Employees Covered by Overtime Rules?
Not every worker necessarily falls under identical working-hour and overtime provisions.
The Labour Law contains provisions concerning exclusions and special categories, and Article 108 identifies certain categories to which the working-hours provisions in Articles 98 and 101 do not apply. These include certain individuals holding high-level positions with management and direction responsibilities, as well as certain types of preparatory, intermittent, guarding, and cleaning work subject to the regulation.
Therefore, employees should not assume that the standard eight-hour/48-hour framework applies identically to every occupation and employment category.
The employment contract, job classification, applicable regulations, and actual duties should be considered.
Key Points
For 2026, the central points are:
- Normal working hours are generally based on 8 hours per day or 48 hours per week under the applicable standard.
- Ramadan reduces actual working hours for Muslim workers to 6 hours per day or 36 hours per week.
- Article 107 requires overtime compensation equal to the hourly wage plus 50% of basic wage.
- In the standard calculation, this is generally expressed as 1.5× the hourly rate.
- Work performed during official holidays is treated as overtime.
- The annual additional-working-hours limit is normally 720 hours, with the regulations allowing an increase with the worker’s consent.
- Paid compensatory leave may be used instead of overtime wages with the worker’s consent.
- There is no universal fixed annual bonus percentage established for every worker.
- Annual bonuses may be granted under the implementing regulations and applicable establishment conditions.
- A bonus can form part of wages under the Ministry’s definition when it is contractually established, provided in work regulations, or becomes customary under the stated conditions.
Frequently Asked Questions
What is the overtime rate in Saudi Arabia?
The statutory overtime compensation under Article 107 is the hourly wage plus 50% of the basic wage. In the standard calculation, this is commonly expressed as 1.5 times the hourly wage.
How do I calculate overtime from my salary?
For the standard monthly basic-salary calculation, divide the monthly basic salary by 30, divide the result by 8, multiply by 1.5, and then multiply by the number of qualifying overtime hours.
Is overtime 1.5 times or 2 times in Saudi Arabia?
The standard statutory Article 107 calculation is 1.5×, not 2×. It is based on the hourly wage plus 50% of basic wage.
Is Eid work considered overtime?
Yes. Article 107 states that working hours performed during holidays and official vacations are overtime hours.
Can my employer give me leave instead of overtime pay?
Paid compensatory leave can be used instead of overtime wages when the worker consents, according to Article 107.
Does every worker receive a 13th-month salary in Saudi Arabia?
There is no universal rule in the cited implementing regulation establishing a mandatory 13th-month salary for every worker.
Final Summary
Under Article 107 of the Saudi Labour Law, overtime pay equals the hourly wage plus 50% of the basic wage — commonly expressed as 1.5× the hourly rate — and also applies to work done on official holidays. For example, a worker with a SAR 6,000 basic salary has an hourly rate of SAR 25, giving an overtime rate of SAR 37.50/hour, so 20 overtime hours would earn SAR 750. The annual limit is normally 720 hours (extendable with consent), employers may offer paid compensatory leave instead of overtime pay with the worker’s agreement, and Ramadan brings reduced hours of six/day or 36/week for Muslim workers.
Bonuses work differently: regulations don’t set one fixed universal amount, leaving annual bonuses to the establishment’s financial position and applicable conditions, though a bonus can become part of wages if it’s written into the contract, work regulations, or paid regularly as customary compensation. For individual disputes, employees should rely on their actual contract, salary records, and attendance documents rather than a general example — and refer to their specific employment terms and applicable regulations.
