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Paid Time Off Policy
"I need a paid time off policy that provides 15 days of annual leave, 5 sick days, and 3 personal days, with accrual starting after 3 months of employment and no rollover."
What is a Paid Time Off Policy?
A Paid Time Off Policy outlines how employees can take paid leave from work while maintaining their salary and benefits. In Saudi Arabia, these policies must align with the Kingdom's Labor Law, which guarantees workers specific leave entitlements including annual vacation days, sick leave, and religious holidays like Eid.
The policy serves as a clear guide for both employers and staff, detailing important aspects like leave accrual rates, approval procedures, and maximum carryover days. It typically covers various leave types recognized under Saudi labor regulations, such as the mandatory 21-day annual leave for private sector employees, and special provisions for Hajj leave, which grants Muslim workers up to 10 days for their first pilgrimage.
When should you use a Paid Time Off Policy?
Organizations need a clear Paid Time Off Policy when establishing new operations in Saudi Arabia or updating existing leave management systems. This policy becomes essential during the annual Hajj season, Ramadan preparations, and when coordinating multiple types of leave across departments while maintaining productivity.
The policy proves particularly valuable when handling complex situations like extended medical absences, overlapping holiday requests, or managing leave during peak business periods. It helps prevent conflicts between employee expectations and Labor Law requirements, especially regarding mandatory leave provisions like the 21-day annual vacation and religious observances. Having this policy in place before issues arise saves time and reduces potential disputes.
What are the different types of Paid Time Off Policy?
- Traditional Fixed PTO: Follows standard Saudi Labor Law requirements with preset annual leave (21 days), sick leave, and religious holiday allocations
- Flexible PTO Structure: Combines different leave types into one unified bank while maintaining mandatory minimums under local law
- Industry-Specific Policies: Tailored for sectors like oil and gas, with provisions for shift workers and remote site employees
- Ramadan-Adjusted Policies: Modified leave calculations and scheduling during the holy month, with special considerations for fasting employees
- Hybrid Systems: Blends fixed statutory leave with flexible additional days for high-performing employees or specific roles
Who should typically use a Paid Time Off Policy?
- HR Directors and Managers: Draft and implement the policy, ensuring compliance with Saudi Labor Law while balancing organizational needs
- Company Leadership: Review and approve PTO policies, setting overall leave strategy and budget allocations
- Line Managers: Handle day-to-day leave requests, maintain staffing levels, and ensure fair policy application
- Employees: Follow policy guidelines for requesting and taking leave, including mandatory religious and annual vacation time
- Legal Advisors: Review policies for compliance with Ministry of Human Resources regulations and labor laws
- Payroll Teams: Process paid leave calculations and maintain accurate leave balance records
How do you write a Paid Time Off Policy?
- Review Labor Law Requirements: Check current Saudi labor regulations for minimum leave entitlements and special provisions
- Gather Company Data: Document existing leave practices, employee count, work schedules, and peak business periods
- Identify Leave Types: List all categories including annual, sick, maternity, Hajj, and religious holiday leave
- Define Procedures: Establish clear request processes, approval chains, and documentation requirements
- Set Accrual Rules: Determine how leave accumulates, maximum carryover limits, and payout policies
- Document Special Cases: Address unique situations like Ramadan working hours and extended medical leave
- Use Our Platform: Generate a legally-compliant policy template customized to your organization's needs
What should be included in a Paid Time Off Policy?
- Leave Entitlements: Clear statement of minimum 21-day annual leave and other statutory leave types
- Religious Accommodations: Specific provisions for Hajj leave, Eid holidays, and Ramadan working hours
- Accrual System: Detailed explanation of how leave accumulates and carries over between years
- Notice Requirements: Mandatory notification periods for different leave types
- Approval Process: Clear chain of authority and documentation requirements
- Sick Leave Terms: Full, partial, and unpaid sick leave allowances per Labor Law
- Maternity Provisions: 10-week paid maternity leave and related benefits
- Compliance Statement: Reference to Saudi Labor Law and Ministry of Human Resources regulations
What's the difference between a Paid Time Off Policy and a Corporate Policy?
A Paid Time Off Policy is often confused with a Corporate Policy, but they serve distinct purposes in Saudi organizations. While both are internal governance documents, their scope and application differ significantly.
- Scope and Focus: A Paid Time Off Policy specifically addresses leave management, vacation days, and religious observances, while a Corporate Policy covers broader organizational principles and operational guidelines
- Legal Requirements: PTO policies must strictly align with Saudi Labor Law's specific leave entitlements, whereas Corporate Policies have more flexibility in their content and structure
- Implementation Level: PTO policies directly impact daily operations and employee benefits, requiring immediate compliance. Corporate Policies often serve as framework documents with longer-term strategic goals
- Update Frequency: PTO policies need regular updates to reflect changing labor laws and religious calendar requirements, while Corporate Policies typically remain stable with less frequent revisions
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