Wage Protection System in Saudi Arabia

Ministry Of Labor and SAMA (Saudi Arabian Monetary Agency) is working jointly on Wage Protection System Saudi Arabia. The aim of WPS is to ensure that private sector employees are correctly paid as per the agreed terms in contract identified in Saudi Social Security and to track the salaries of expatriates and nationals.

Companies should comply with Wage Protection System within 2 months of it made compulsory and have to submit the information to Labor Ministry via e-service program, In case of failed, 

- Ministry of Labor will deny and suspend all the services to the company.

- Except Issue and renewal of work permits. 

- Allows the employees to transfer to another company without consent of current sponsor.

Private sector companies require to 

- Register the company with Wage Protection System. 

- Submit the wage data to Labor Ministry and the salaries of employees using e service program.

- Open a pay roll file with authenticated local bank.

- Open local bank accounts and should be paid the salaries through local banks.

Salary Delays in Wage Protection System :

- If the company delays salary for 2 months, their services will be blocked by Labor Ministry except work permit renewals

- If the company delays salary for 3 months, It will loose labor force, Expatriate employees allowed to transfer without sponsor approval. 

Wage Protection System for companies became compulsory in Saudi Arabia, It was started in June of 2013 for the companies who have more than 3000 employees.

- In September 2013 it made mandatory for firms which has above 2000 employees.

- In December 2013 for the organizations with 1000 employees.

- In November 2014 it includes those companies with over 500 employees.

In the year 2015 also, The phases of Wage Protection System continued,

- Starting in February it made necessary for companies having more than 320 employees.

- In April it made compulsory with over 240 employees.

- In June for companies with over 170 employees.

- In August for firms with over 130 employees.

- In November Wage Protection System made mandatory for the companies having 100 plus employees.

- Wage Protection System Saudi Arabia next phase is about to implement from 1st Feb 2016, for the companies with employees more than 11 and less than 100.

- From August 2017, It is covering the companies with more than 60 employees ''11th Phase of WPS".