Occupational Hazards Branch

What the occupational hazards branch is

The occupational hazards branch (فرع الأخطار المهنية) is one of the branches of social insurance in Saudi Arabia, administered by the General Organization for Social Insurance (GOSI). Three features, taken together, set it apart from the other branches: the employer alone bears its contribution, its rate does not step from year to year, and the article that sets its scope carries no reference to nationality.

The word “branch” in this term names a category of insurance cover, not a unit of the establishment. The branches in the Social Insurance Law (نظام التأمينات الاجتماعية) are separate categories of cover, each with a scope and a contribution rate, whereas the branches of an establishment are sites and functions run as part of its administration. Reading “branch” on a contributions statement as the place where the employee works gives the word a meaning it does not carry on that statement.

The law in force is the Social Insurance Law issued by Royal Decree M/273 of 26/12/1445H, which took effect on 3 July 2024. Clause Second of Council of Ministers Decision 1022, the decision that approved it, keeps two groups outside it: subscribers with contribution periods before the law took effect for which they have not been compensated, and those already entitled to a pension under the earlier laws. For those two groups, Clause Fourth of Council of Ministers Decision 1022 continues the earlier laws, among them the Social Insurance Law issued by Royal Decree M/33 and the Civil Retirement Law issued by Royal Decree M/41, subject to the exceptions in Clauses Fifth and Sixth of Council of Ministers Decision 1022. Unless another instrument is named, the articles cited below are those of the Social Insurance Law issued by Royal Decree M/273.

The occupational hazards branch rate, and why “until 2028” does not apply to it

The occupational hazards branch rate is 2% of the contributory wage, borne by the employer alone, and nothing is deducted from the subscriber’s pay in respect of it. The rate is 2% in the contribution tables both for subscribers who remain under the earlier laws and for those who joined under the Social Insurance Law issued by Royal Decree M/273. It is not part of the annual step schedule, which belongs to the pensions branch; it sits on top of that schedule at a fixed rate.

That is the distinction lost when a single combined figure for the employer’s share is published. For a subscriber who joined under the Social Insurance Law issued by Royal Decree M/273, part of the employer’s share changes on 1 July of each year until 2028 and part of it does not. Today that share is 12.75%: 10% for pensions, 0.75% for SANED and 2% for occupational hazards. Only the pensions element moves, to 10.5% from 1 July 2027 and to 11% from 1 July 2028. The full dated table is set out under GOSI contributions, and the SANED element under SANED.

A worked example shows the effect. Take a Saudi employee who joined under the Social Insurance Law issued by Royal Decree M/273, with a contributory wage of SAR 10,000 a month:

• Occupational hazards. 10,000 × 2% = SAR 200 a month, the same in 2026, 2027 and 2028.
• Pensions, employer side. SAR 1,000 a month at the 10% in force since 1 July 2026, SAR 1,050 from 1 July 2027 and SAR 1,100 from 1 July 2028.

A budget that carries 12.75% forward unchanged understates the employer’s cost on that wage by SAR 50 a month from 1 July 2027 and by SAR 100 a month from 1 July 2028. None of that difference comes from the occupational hazards branch, which is a reason to show its 2% as a separate line rather than fold it into one total.

Occupational hazards branch scope: three articles side by side

The difference in scope between the branches does not rest on one sentence of the Social Insurance Law. It appears when three of its articles are set next to each other:

• Pensions. Article 14 of the Social Insurance Law names Saudis as the persons to whom the pensions branch applies.
• Unemployment insurance (SANED). Article 43 of the Social Insurance Law likewise names Saudis, applying the branch to Saudi workers who work inside the Kingdom.
• Occupational hazards. Article 28 of the Social Insurance Law applies the branch compulsorily to all employees who work inside the Kingdom and to all workers who work inside the Kingdom, with no reference to nationality.

The conclusion is one the reader draws from the difference in drafting between the three articles. The Social Insurance Law does not state in a single sentence that a particular person is covered by the occupational hazards branch alone, so no such sentence should be presented as its text. In the published contribution tables, the employer’s contribution for an employee who is not a Saudi national is the 2% of this branch, with nothing deducted from that employee.

Article 28 of the Social Insurance Law names employees (الموظفين), that is, civil servants, alongside workers. Paragraph (4) of Clause Third of Council of Ministers Decision 1022 leaves the date on which the branch starts for civil servants to a later decision of the Council of Ministers. Separately, Article 6 of the Social Insurance Law makes the subjection of seven categories to the law a matter for decisions of GOSI’s board of directors, among them domestic workers and workers who are not Saudi nationals and who come to the Kingdom on a temporary or seasonal work visa for no more than sixty days. In the sources we reviewed, we did not find those board decisions, so no conclusion is drawn on whether the branch reaches those categories.

When occupational hazards branch contributions stop or double

Contributions stop after departure from the Kingdom. Article 23 of the Implementing Regulation (اللائحة التنفيذية) of the Social Insurance Law provides that the employer does not pay this branch’s contributions for subscribers who leave the Kingdom, starting from the first day of the month after the date on which they leave. The same article excepts Saudi transport crews and subscribers who leave the Kingdom for the purpose of work. The stop therefore does not fall on the date of departure itself but on the first day of the following month: for a subscriber who leaves the Kingdom on 10 March, the contribution for March remains due, and the stop takes effect from 1 April.

The rate can be doubled for an employer in breach. Article 29(1) of the Social Insurance Law and Article 22 of the Implementing Regulation of the Social Insurance Law allow the rate of this branch’s contributions, and of the additional compensations, to be increased up to double at most, after the employer has been warned and given a period in which to remove the violation. Doubling is therefore conditional on a prior warning and on that period; it is not a penalty that applies from the outset. On the contributory wage of SAR 10,000 in the example above, double the rate would be at most SAR 400 a month in place of SAR 200.

The period for removing the violation is the one the warning specifies.

The occupational hazards branch in the cost of employment

The employer’s contribution to this branch does not appear in the employee’s salary and is not deducted from it; the establishment bears it in full on top of the agreed wage. In payroll accounting it therefore sits on the expense side, not among the deductions, and it is held as an amount payable to GOSI until it is remitted.

The base is the contributory wage (الأجر الخاضع للاشتراك), not total entitlements. Take monthly entitlements of SAR 12,000, made up of a basic wage of SAR 9,000, a cash housing allowance of SAR 1,500 and a transport allowance of SAR 1,500. A transport allowance falls outside the contributory wage, so the contributory wage is SAR 10,500 and the occupational hazards contribution is 10,500 × 2% = SAR 210, not the SAR 240 that 2% of total entitlements would give.

What the occupational hazards branch covers beyond the contribution

The rules above concern the contribution: who bears it, at what rate, when it stops and when it can be doubled. What the branch pays when a work injury or an occupational disease occurs, with the conditions, amounts and claim periods that go with it, has its own provisions in the social insurance law that governs the subscriber and in the decisions issued under it, and no rule on them is drawn from the definition. For subscribers under the Social Insurance Law issued by Royal Decree M/273, those provisions are in that law; for the subscribers whom Clause Second of Council of Ministers Decision 1022 leaves under the earlier laws, they are in the Social Insurance Law issued by Royal Decree M/33, as modified by Clause Sixth of Council of Ministers Decision 1022. On an individual claim, GOSI is the direct reference.

The wider system to which the branch belongs is outlined under social insurance.

This is an explanation of the concept and of the statutory provisions cited, not legal advice.