In Saudi Arabia, a GOSI contract is the application of social insurance laws and regulations. Likewise, this contract may apply to military personnel, and civilian employees who have a salary dependent on the government or public organizations. In addition, private sector workers and some self-employed workers can use the service.
In this article, you will learn how GOSI, or the General Organization for Social Insurance works in depth. Also, how it can benefit your workers and everything you need to know about the subject.
Benefits of Contract General Organization for Social Insurance (GOSI)
Before mentioning the benefits of GOSI Contract in Saudi Arabia, we will define what it is GOSI or the Government Organization for Social Insurance. GOSI is an autonomous financial and administrative entity, created in 1973 and its main function is to deal with Social Security.
Likewise, the main office of this organization is in Riyadh and 13 administrators managed it. Similarly, some of the directors are insured and other employers are representatives of some government agency. Therefore, its main objective is the development of social security and its equitable distribution between taxpayers and their relatives.
Features of the GOSI Contract
The characteristics of a contract from the General Organization for Social Insurance by its acronym, GOSI, are the following:
- Social security is mandatory. Companies that have 10 or more employees on their payroll will have the obligation to apply for Social Security. Also, it is the employer who will have to register the employee and make the contributions on their behalf.
- Contributions are equitable between workers and their employers. Workers and employers pay the contributions, so that the employer will contribute 70% and the worker will contribute 30%.
- Social Security will begin at the time you start work. Employees will receive this benefit starting on the first day of employment. That is, they will obtain the right to it when they start working.
Medical Treatment
A GOSI’s Role in Saudi Arabia’s Social Security is to guarantee comprehensive work care in case of a work accident. Likewise, this will be until recovery and will include treatments, medications, and prostheses, among others. Below, you will see the reasons considered as work accidents:
- Accidents during work or as a result of it
- The accident that the worker may suffer when traveling to the workplace from his home or vice versa, also from the place where he works to where he eats, prays, or vice versa.
- Workplace accidents that occur when the employee goes to carry out the work indicated by his employer.
- If the employee becomes ill due to the work he or she performs
- When an employee suffers any occupational disease caused by the type of employment.
Daily Allowance
When the employee suffers an accident while working and have a temporary work disability, he or she will have the right to receive compensation. Likewise, they will receive this subsidy daily and will possibly reach 100% of the salary that the worker normally receives. However, this amount is of 75% if GOSI covers the fee for the treatment of the employee.
Therefore, consider that this subsidy will be possible for the hospitalization or the sick leave of the worker.
Saudi Employee’s Partial Disability
An employee who suffers from a partial disability will receive salary compensation per month, equal to 100% of 3 months of salary. Also, it will be the doctor who will continually evaluate you for 5 months to know if you can continue receiving the benefit. If it passes 5 years and authorities determine that you still need benefits, they will fix it.
Likewise, if you need others, compensation they will give you for 10 years and if the service continues, it will now be permanent.
Compensation for Injuries Suffered by Non-Saudi Personnel
One of the benefits of the GOSI contract is that if a foreign employee suffers an injury at work, they will receive a one-time compensation. Below are the criteria for the payment of this compensation:
- If the employee suffers an injury that permanently disables him (100%), he will receive compensation equal to 84 months of his benefit. In addition, it will have a limit of SAR3 30,000 considering additional assistance determined by an accredited medical board.
- If the foreign employee becomes partially disabled, 50% to 99% will receive full compensation equal to 60 months of their benefit entitlement. Also, this amount could reach about SAR 16,500.
- When the employee dies from the injury, family members receive a payment equal to 84 months of the benefits the employee would receive. Likewise, the contribution would be limited to up to SAR 330,000 and the total compensation would be distributed among your family members.
Payment for employees with less than 50% disability for Saudis and non-Saudis
Under the GOSI contract, the employee will receive a single payment based on the percentage of the disability they have. In addition, it will depend on the age and whether the injury results in a disability of less than 50%. In the same way, an employee of approximately 40 years of age will receive a one-time contribution equal to 60 times his salary per month.
To do this, the total value of the payment will be calculated for the disability multiplied by the percentage of the disability and by 60. However, the result may be a maximum of SAR 165,000.
Unemployment benefits
SANED is the name of the unemployment insurance program and applies by GOSI. With it, unemployed citizens will receive 90% of their compensation after leaving employment. Below, you will see the criteria to receive the benefit:
- That they are Saudi citizens
- They are registered in the Social Security Law
- If they were forced to leave their job for irremediable reasons
In addition, Saudi citizens will be able to receive social unemployment insurance whether they are from the public or private sector. Equally, they will receive a monthly payment for the first 3 months of SAR 9,000 and then if they do not find employment they will receive SAR 7500 monthly. In the same way, you will receive this compensation constantly or occasionally for 1 year and no more.
Payment of maternity benefits
An employee on maternity leave will be entitled to a contribution as established in the GOSI contract. Likewise, with this benefit, you will obtain coverage for hospitalization, medical expenses, or any necessary expenses.
Retirement pension payments for old age, disability, and death
An employee will have the right to receive payments for retirement, disability, and death as we will see below:
Elderly retirement
The old-age pension will be obtained by a contributor who meets the following criteria.
- Be 70 years old or older.
- When the work activity ceases, or the contribution is interrupted for the employee who has a prior period of obligatory contribution.
- Have contributions for a minimum of 120 months.
Pension payment for early retirement
The contributing employee will receive the pension early before age 60 if he/she meets the following conditions:
- Have contributions of at least 300 months.
- Request pension payment.
- Cessation of the activity for which they were employed, and not doing any other activity that is covered by the regime. Likewise, stop contributing if a previous mandatory contribution period
Payment of non-professional disability pension
The GOSI contract contemplates that if the person who contributes is totally disabled for employment or someone appropriate for his or her condition. Thus, you may qualify as a disabled person and receive the disability pension if you meet the following aspects:
- If the employee began contributing before age 50. Also, if the disability that you had when you made contributions for at least 12 consecutive months. It may also be for 18 non-continuous months after registration with GOSI.
- If the disability began after the contributing employee left employment and has been contributing for at least 60 months. Therefore, you can request by right to add a period until you reach 120 months.
Disability pensions are calculated as they are with the retirement pension. However, the amount must be less than 50% of the salary averaged over 2 years.
Payment of the death pension of the worker
The immediate family members of a deceased contributing employee will have the right to receive the death pension for the following reasons:
- If an employee who had a retirement or disability pension dies, he or she is not professional.
- If you started contributing sometime before age 50, and you must have a contribution period of no less than 3 months. This can be consecutively or for 6 non-continuous months after the date of registration of GOSI.
Additionally, the death pension is calculated in the same way as the non-professional disability pension is calculated. Additionally, when the contributor dies after leaving employment, he or she must have a contribution of no less than 60 months; family members may request a supplement. This supplement may reach 120 months and in this case, they will be paid a retirement pension.
GOSI Contributions
According to the law, about the GOSI contract, the nationality of the employee and depending on which sector they work for will determine which of their incomes apply. Additionally, if your salary comes from the basic salary per month from January or for the month of your hiring.
According to Gosi, the monthly contribution to be paid by the employee and the employer is a maximum of SAR 45,000. Next, we will break down what the payments are like for nationals from the GCC and for expatriate employees:
For CCG workers it will be like this:
- The contribution of the employer will be 12%
- The employee contribution will be 10%
Expatriate employees will be as follows:
- The contribution given by the employer will be 2%
- Foreign employees will not have to pay any contribution.
Saudi GOSI contribution certificate
Regarding how to check GOSI status in KSA? It will be through the website of the electronic services of the General Organization of Social Insurance. Likewise, you can download a contribution certificate in which you will see the salaries of the contributors and how long the contribution lasted. Here is how to verify and download the GOSI certificate:
- Log in to your GOSI account
- Enter the details of the collaborator account.
- Selections ISSUANCE OF CERTIFICATES
- Choose what type of certificate you need in TAXPAYER INSURANCE TERMS AND WAGES
- Lastly, download the certificate
GOSI e-services
Currently, in Saudi Arabia, electronic services for GOSI are available, which is an advance as it has many channels available. Likewise, you will find online services, GOSI-Phone, electronic payments, SMS messaging, and direct link service.
How to register GOSI Saudi Arabia?
Every company must register to be able to track employer contributions. It will also allow you to print the GOSI certificate by following these steps:
- Enter the GOSI online registration site
- Choose the type of beneficiary, whether it is a Collaborator, Establishment, or Hospital
- Now, select the REGISTER option
- Enter all the requested data, including Iqama number, telephone, email, and password
- Then, enter the Captcha accurately and select CONTINUE
- Finally, validate the data with the code you will receive and complete the registration
GOSI Calculations
The GOSI calculation in Saudi Arabia will be done based on the income of the employee divided into two categories:
- GOSI for Saudi citizens
- GOSI for expat citizens
Additionally, the base salary and housing allowance are the factors to make the calculations. The methods used to calculate GOSI include the following formula for Saudi nationals who work in the public or commercial sector. Likewise, the employee must cover 22% of the maximum contribution per month. In the same way, the contribution is as follows:
- 9% of the contribution of the employee goes towards an annuity (pension).
- 1% of the employer contribution goes towards unemployment benefits.
- The remaining 2% of the business contribution is for occupational risks.
Similarly, the calculation of GOSI for expatriates will be as follows:
- The employer will pay unemployment benefits at 2% of the maximum eligible monthly earnings, which is between SAR 400 and SAR 45,000.
Employer contribution
- Unemployment Tax = 0.75%.
- Retirement Payment = 9%.
- Disability and Compensation Plans = 2%
- Total Employer Tax = 11.75%
Employee contribution
- Unemployment Tax = 1%.
- Retirement Payment = 9%.
- Total employee tax = 9.75%
Additionally, for Saudi citizens, according to GOSI the proportion will be 22% of the basic salary plus the housing contribution.
The calculation of the GOSI contract will serve to cover the interests of companies and employees alike. In addition, companies in Saudi Arabia highly value the services that GOSI has available. It is also an exceptional method compared to others worldwide and benefits both national and foreign employees.
You were already able to learn about the GOSI in detail, but if you have any questions on the subject, please contact us. As specialists in this and other subjects, we are capable of responding to you promptly.
