King Salman Orders SR5,000 Minimum Wage for Saudis Under Nitaqat, Rising to SR6,000
Custodian of the Two Holy Mosques King Salman has ordered a package of measures to support Saudi citizens, based on a proposal from Crown Prince and Prime Minister Mohammed bin Salman. Most of the headlines will focus on the SR500 monthly allowance increase, but the part private-sector employers need to look at is the change to Nitaqat wage thresholds. The minimum monthly salary a Saudi employee must earn to count fully toward Saudization quotas is going up to SR5,000, and later to SR6,000.
The package comes alongside adjustments to electricity and water tariffs announced by the Saudi Energy Company and the National Water Company, which take effect on January 1, 2027.
1. The Nitaqat Wage Threshold Increase
Under Nitaqat, a Saudi employee only counts as a full Saudization unit when their monthly wage meets a set minimum. The threshold has been SR4,000. The Royal directive raises it in two steps:
| Phase | Minimum Monthly Wage for a Full Nitaqat Count | Effective |
|---|---|---|
| Current | SR4,000 | In force now |
| Phase 1 | SR5,000 | Six months after the measure takes effect |
| Phase 2 | SR6,000 | 12 months after the first increase is implemented |
The stated aim is to raise salary levels and support sustainable private-sector employment for Saudi citizens.
In practice, a Saudi employee paid SR4,000–4,999 who counts fully toward your quota today will stop counting fully once Phase 1 applies, unless their salary goes up.
The exact start date for the six-month countdown hasn’t been confirmed in the initial announcement. We expect the Ministry of Human Resources and Social Development (MHRSD) to publish the implementation details, and employers should watch for them.
2. The SR500 Allowance Increase
The rest of the package is direct financial support to offset the tariff changes:
- Government employees: monthly allowances go up by SR500 for eligible civilian and military employees on civil service pay scales and employment programs
- Retirees and dependants: the same SR500 increase applies to retirees, and to family members of deceased contributors or retirees, covered by the Social Insurance Law
- Social security families: households in the social security system get an extra SR500 a month, subject to the applicable regulations
These allowances are paid by the state. They don’t create a direct cost for private-sector employers, but the Nitaqat change does.
3. What This Means for Your Nitaqat Band
Your Nitaqat band (Platinum, High Green, Medium Green, Low Green, Red) depends on your Saudization percentage. That percentage only counts Saudi employees who meet the wage threshold in full. If several of your Saudi staff are paid between SR4,000 and SR5,999, the new thresholds could pull your effective Saudization rate down without a single change in headcount.
A lower band can affect your ability to:
- Issue new work visas and recruit from abroad
- Renew iqamas and work permits for expatriate staff
- Transfer sponsorship and change professions
- Access MHRSD and Qiwa services that depend on your establishment being compliant
Businesses sitting just above a band boundary, and sectors where Saudi entry-level salaries cluster around SR4,000 (retail, hospitality, contracting and customer service), are the most exposed.
What Employers Should Do Now
Phase 1 is at least six months away, so there’s time to plan, but the budget impact needs to be in next year’s numbers now. Recommended actions:
- Audit your Saudi payroll. List every Saudi employee earning under SR6,000 and flag who drops below a full count at SR5,000 and at SR6,000.
- Model your Nitaqat band at each phase. Recalculate your Saudization percentage under both thresholds to see whether your band changes.
- Budget for salary adjustments. Work out what it costs to bring key Saudi staff up to SR5,000, and then SR6,000, and compare that with the cost of a lower band.
- Check GOSI registrations. Nitaqat reads wages from GOSI, so any salary increase only counts once it’s reflected in the employee’s GOSI record.
- Watch for MHRSD implementation rules. Confirm the start date and any sector-specific provisions before you finalise contracts and budgets.
For businesses without in-house HR or government relations staff, payroll audits, Nitaqat modelling and GOSI updates are easy to leave until a visa or iqama renewal gets blocked. Beyond Borders’ PRO and GRO services cover Saudization planning, Nitaqat compliance and Qiwa/GOSI updates, so you can get your establishment ready before the new thresholds apply.
Source: Saudi Gazette. This article is for informational purposes only and does not constitute legal advice.