Penalty for registering an employee with an incorrect wage in social security

The General Organization for Social Insurance in the Kingdom of Saudi Arabia stressed the need for employers to adhere to transparency and credibility when registering employee data, warning of the legal and financial consequences resulting from manipulating registered wages or neglecting to register employees.

Penalty for wage and registration fraud

The General Organization for Social Insurance (GOSI) clarified that the system guarantees workers' rights by imposing strict penalties on violators. Failure by an employer to register their employees in the system, or registering them with an incorrect wage (less or more than their actual wage), is a clear violation that warrants punishment.

The authority confirmed that the financial penalty for this violation is (10,000) ten thousand Saudi riyals , and this penalty is doubled in the event of a repeat violation, and the fines are multiplied according to the number of workers in respect of whom the violations were committed, in order to ensure the protection of the insurance rights of the subscribers.

The importance of accurate wage recording

This emphasis stems from the institution's commitment to safeguarding the future rights of its subscribers, as the registered salary directly impacts the insurance benefits they receive, such as retirement pensions, unemployment benefits (SANED), and occupational hazard compensation. Registering with the actual salary is a fundamental pillar for ensuring the financial stability of the employee and their family in the future.

Documents required for disbursing family member benefits

In a related context, and in continuation of its role in caring for the families of subscribers, the Authority has specified a list of necessary documents that family members must submit to be eligible for disbursement in the event of the subscriber's death, as follows:

• Fill out the compensation process form (available via the website).
• The subscriber's death certificate or an official certified document that specifies the date of death.
• A certified inheritance certificate showing the beneficiaries and their ages.
• The marriage contract of the widow or widower to the participant, or any official document proving the marital relationship.
• Proof of the subscriber's support for the applicant for disbursement (excluding widows, sons, and daughters).
• A document proving that children or siblings who are over 21 years of age are regularly attending school (renewed annually until age 26 or graduation).
• Certified medical reports proving the inability to earn a living in cases that require it to be presented to the medical committee.
• A document proving that the widow, father, or grandfather has reached the age of sixty, or a medical report proving disability if the age is less than that.
• Bank account number (IBAN) for pension transfer.
• National identity card or family card for eligible heirs.

The authority also noted the need for non-Saudi heirs to submit the annual declaration on the specified dates to ensure the continuation of payments.

Optional Subscription System: Categories and Conditions

As part of expanding the umbrella of insurance protection, the Saudi social insurance system has provided the opportunity for "voluntary participation" in the pensions branch for a number of categories that are not subject to the system compulsorily, giving them the opportunity to obtain a retirement pension and protect their families.

The categories eligible for optional subscription include:

1. Self-employed professionals who have obtained practice licenses from the competent authorities.
2. Self-employed craftsmen (such as blacksmiths, carpenters, plumbers) under official licenses.
3. Saudi citizens working outside the Kingdom without being affiliated with an employer based inside the Kingdom.
4. Saudis working in foreign international, political, or military missions within the Kingdom who are not subject to the system compulsorily.
5. Subscribers whose mandatory subscription has stopped and who wish to complete the period to receive the pension, provided that the regulatory conditions are met.

Through these systems, the Kingdom seeks to strengthen the social safety net, in line with the goals of Vision 2030 to improve the quality of life and ensure a secure financial future for all segments of society.