Understanding the Wage Protection System (WPS) in Saudi Arabia

Understand the requirements and core features of the Wage Protection System (WPS) to stay compliant and avoid penalties.

Every company operating in Saudi Arabia, including foreign entities in the process of setting up a business in the Kingdom, must comply with WPS requirements. Non-compliance results in penalties, restricted access to government services, and potential limitations on visa processing.

The Wage Protection System (WPS) is a mandatory compliance framework introduced by the Ministry of Human Resources and Social Development (MHRSD) to ensure employees receive their salaries on time and in full, exactly as stipulated in their contracts.

Core Employer Obligations

1. Register on Official Platforms

Companies must register and maintain active accounts on four government platforms:

• Mudad: Wage monitoring and reporting system (MHRSD)
• Qiwa: Employment contract validation and labor relations
• Muqeem: Expatriate employee data management
• GOSI: Wage records and social insurance contributions

Related read: Mudad, Muqeem, Qiwa: Next Steps After Setting Up in Saudi For Foreign Business

2. Use a Corporate Bank Account

All salary payments must be processed through licensed Saudi banks via:

• Electronic bank transfers
• Prepaid payroll cards

Cash payments are not permitted. Every transaction must be traceable and match the amounts specified in employment contracts.

Related read: What is Required from Foreign Businesses for Opening a Bank Account in Saudi Arabia?

3. Submit Monthly Payroll Data

Employers must upload payroll files to Mudad every month containing:

• Employee salaries
• Payment dates
• Contract wage amounts

The system automatically flags delays or discrepancies. Any inconsistencies trigger clarification requests from MHRSD.

The WPS Certificate

The WPS Certificate is your official proof that the company complies with Saudi labor laws by paying salaries on time through authorized banking channels.

Why You Need It

• Visa Processing: Required for issuing and renewing employee visas and work permits
• Platform Access: Necessary to access Qiwa and Muqeem for HR operations
• Compliance Verification: Confirms that payroll files have been accurately uploaded and validated through Mudad

How to Obtain It

The certificate is generated automatically once your company successfully submits payroll files through Mudad that match employment contract terms. Banks validate the data before it's transmitted to MHRSD.

Benefits of WPS Compliance

Operational Efficiency

• Streamlined payroll and HR management
• Automated reporting reduces administrative burden
• Integrated systems minimize manual data entry

Risk Mitigation

• Avoid financial penalties for late or incorrect payments
• Prevent service restrictions on government platforms
• Maintain uninterrupted visa processing capabilities

Employer Reputation

• Demonstrate fair and transparent employment practices
• Attract higher-quality candidates
• Build trust with employees and authorities

Companies must prioritize WPS compliance from the outset to avoid penalties, maintain smooth operations, and build strong reputations as fair employers; all are critical advantages in Saudi Arabia's competitive business environment.