Why the Module List Matters
HR in a mid-sized Saudi company means a long list of recurring monthly jobs: capturing attendance, calculating overtime and absence, approving leave, running payroll, uploading the wage protection file, chasing expiring iqamas, working out end-of-service awards for leavers, and answering staff questions about balances and payslips. When these jobs are spread across spreadsheets, email and paper, the HR team spends its time copying and reconciling instead of hiring and developing people.
An HRMS pulls this work onto one platform, but systems differ widely in which modules they include and how well they fit Saudi labour rules. This guide goes through the must-have modules one by one: what each should do, which local requirements it has to handle, worked calculations where they help, and a checklist of questions to put to any vendor.
1. Employee Records and Organisation Structure
This is the core that every other module reads from. One digital file per employee holding:
- Personal details, nationality, ID or iqama number and expiry.
- Contract data: start date, fixed or indefinite term, probation period, title and grade.
- Pay components: basic, housing, transport and other allowances, kept separate because each feeds different calculations.
- Bank details for salary transfer.
- Department, branch, cost center and line manager.
- Change history: promotions, transfers, salary changes, each with an effective date.
The org structure is not just a chart. It drives approval routing: an employee's leave request goes to their line manager automatically, and the manager's own request goes one level up. Keep it current, or requests will sit with managers who have left.
Probation and contract type need to be exact. Since the Labor Law amendments effective February 2025, probation can run up to 180 days and must be stated in the contract.
2. Recruitment and Onboarding
From raising and budget-approving a vacancy to posting it, collecting applications, scheduling interviews and issuing offers. After acceptance comes onboarding: a task list per new joiner covering contract signature, equipment handover, system accounts, induction training and policies. A good system turns the accepted candidate's record into an employee file without re-entry and reminds each person of their onboarding task.
3. Time and Attendance
Clock-in and clock-out through biometric devices or a mobile app, with location verification for field staff and project sites. From this the system calculates lateness, early leaving, absence and overtime, and passes them to payroll.
The system has to know the legal limits: a maximum of 8 hours a day or 48 a week, reduced in Ramadan for Muslim employees to 6 a day or 36 a week. For outdoor sites, schedules also need to respect the midday work ban, which prohibits work under direct sun from 12:00 to 15:00 between 15 June and 15 September each year. Tranquil's time and attendance module covers this area, including geo-fencing for field staff.
4. Scheduling and Shifts
Warehouses, plants and retail rarely run one timetable. The scheduling module defines shifts, assigns them, handles swaps and weekly rest, and compares actual attendance with the planned shift rather than a fixed office day. Without that link, the night-shift worker shows up as late every single day.
5. Leave Management
Leave types, accrual rules and balances; electronic request and approval; and a direct link to payroll. The main entitlements a Saudi HRMS must support:
| Leave type | Entitlement |
|---|---|
| Annual | 21 days, rising to 30 days after five years of continuous service |
| Sick | Within one year: first 30 days at full pay, next 60 days at three-quarters pay, next 30 days unpaid |
| Maternity | 12 weeks at full pay since the February 2025 amendments |
| Paternity | 3 paid days |
| Hajj | 10 to 15 paid days, once during employment, after two years of service |
Sick leave in particular needs a system that counts days used across the year and applies the right tier automatically. An employee who has used 40 sick days this year is owed three-quarters pay for days 31 to 40, which is easy to get wrong by hand.
6. Payroll
The most sensitive module, because every error reaches an employee. The system builds monthly pay from the pay components, adds overtime and variable allowances, deducts absence, advances and unpaid leave, then calculates social insurance contributions.
Worked example: GOSI contributions
A Saudi employee under the existing system earns SAR 9,000 basic plus SAR 3,000 housing. The contribution base is basic plus housing, SAR 12,000, within the SAR 45,000 monthly cap. The employee's share at 9.75% is SAR 1,170, deducted from pay; the employer's share at 11.75% is SAR 1,410. For a non-Saudi employee, the employer pays 2% for occupational hazards only. New entrants since 3 July 2024 fall under the new Social Insurance Law with annuity rates that step up over time, so the system must tell the two groups apart.
Worked example: an overtime hour
Under the Labor Law, an overtime hour is paid at the hourly wage plus 50% of the basic hourly wage. Take total pay of SAR 8,000 with SAR 6,000 basic over 240 hours a month (30 days × 8 hours). The hourly wage is about SAR 33.33, 50% of basic hourly is SAR 12.50, so an overtime hour is about SAR 45.83. This is illustrative; how the hourly rate is derived follows company policy and contracts within the law.
Wage protection
Once payroll is approved, the system produces the bank transfer file and the wage protection file. Since 1 March 2025, the WPS file must be uploaded through Mudad within 30 days rather than 60, so a reminder and a reconciliation between what was paid and what was in payroll are both worth having.
Finally, the payroll journal posts to the right accounts and cost centers, which is where having payroll inside the same ERP as accounting pays off. See Tranquil's HR and payroll solution.
7. End of Service and Final Settlement
When employment ends, the system calculates final dues: salary to the last day, unused leave and the end-of-service award. Under Article 84, the award is half a month's wage for each of the first five years and a full month's wage for each year after that, with partial years prorated, based on the last actual wage including allowances.
Hypothetical example: seven years of service, last wage SAR 10,000. First five years: 5 × 5,000 = SAR 25,000. Next two years: 2 × 10,000 = SAR 20,000. Total SAR 45,000. Entitlement differs on resignation depending on length of service, so the system needs the reason for leaving to apply the right rule. We go deeper in end of service and leave under Saudi labor law.
Calculating at exit is not enough. The award is a liability that builds every month; a good system accrues the provision monthly and posts it, so the company is not hit by a large unplanned sum when several long-serving staff leave together.
8. Documents and Expiry Alerts
Digital storage for contracts, certificates, ID, passport and iqama copies, driving licences and medical insurance, with an expiry date on each and an alert well before it lapses. In a company with hundreds of expatriate staff, one late iqama renewal blocks that employee's transactions and can bring penalties. Integration with Muqeem improves accuracy, because iqama and visa data comes from the source. See Tranquil's document expiry alerts.
9. Employee and Manager Self-Service
A portal or app where employees request leave, check balances, download payslips, ask for salary certificates and update some of their own details. Managers see team leave, approve requests and view attendance in one place. The payoff is fewer repetitive questions reaching HR and faster approvals.
10. Performance and Training
Goals per employee, progress tracking, periodic reviews on configurable templates, and links to pay and promotion decisions. Training follows from performance: gaps found in reviews become a training plan. The recent Labor Law amendments also require employers to adopt training and qualification policies, and documenting them in the system makes compliance easy to show.
11. Compliance and Reporting
- Saudisation tracking under Nitaqat, with Saudi and non-Saudi headcount per activity.
- Contract data registered on Qiwa, reconciled to employee files.
- GOSI and wage protection reporting.
- An audit trail for every change to pay and sensitive data, and permissions limiting salary visibility to those who need it, especially with the PDPL in force.
Management reports should cover headcount by department and nationality, turnover, payroll cost by cost center, absence and overtime, and expired documents.
How the Modules Work Together in One Month
Follow a hypothetical warehouse worker in Dammam:
- Scheduling: assigned to the 14:00 to 22:00 shift, six days a week.
- Attendance: the biometric device records 40 minutes late on two days and two extra hours on four days at the supervisor's request, eight overtime hours in total.
- Leave: three sick days requested in the self-service app with a medical report and approved by the manager. It is the first sick leave this year, so it is fully paid.
- Payroll: the run applies the approved lateness policy, adds eight overtime hours at the calculated rate, treats sick days at full pay, and calculates GOSI on basic plus housing.
- Accounting: payroll posts to the Dammam warehouse cost center and the end-of-service provision updates.
- Documents: the same month, an alert flags that the iqama expires in 60 days, so renewal starts early.
Done manually, each step is a file sent and a number re-keyed. In an integrated system, each event is entered once where it happens and the other modules read it.
Moving From Spreadsheets
- Clean employee data: ID and iqama numbers with expiry dates, and actual start dates, which drive end of service and annual leave.
- Split pay components: many spreadsheets hold a single gross figure; the system needs basic, housing and allowances separately.
- Load opening balances: leave balances, outstanding advances and the accrued end-of-service provision.
- Run parallel payrolls for one or two months and compare employee by employee before relying on the new system alone.
- Train managers on approvals, because self-service fails if requests sit unanswered.
More in our guide to payroll migration.
Which Modules for Which Company Size?
| Company size | Start with | Can wait |
|---|---|---|
| Under 30 staff | Employee records, leave, payroll and WPS, documents | Automated recruitment, detailed appraisals |
| 30 to 200 staff | All of the above plus automated attendance, self-service, end of service with provision | Advanced turnover analytics |
| 200+ staff or many sites | All of the above plus shifts, geo-fencing, multi-level approvals, Saudisation reporting | Little can wait at this size |
Questions to Ask Any Vendor
- Does it apply sick leave pay tiers automatically across the year?
- Does it separate GOSI members under the existing and new systems?
- Does it produce the WPS file in the required format, and the bank transfer file?
- Does it calculate end of service by reason for leaving and accrue the provision monthly?
- Does payroll post to accounting and cost centers without export and import?
- Does it support location-verified attendance for projects and outdoor sites?
- Can approval routes be configured to match our structure?
Ask to see these scenarios run on data close to yours rather than a generic slide deck. For the broader distinction between HR administration and talent strategy, see HCM vs HRM.
Frequently Asked Questions
What are the core HRMS modules?
Employee records, attendance, leave, payroll, end of service, documents and self-service. Recruitment and performance matter too, but smaller firms often start with the core and add them later.
Should the HRMS be part of the ERP?
It does not have to be, but it saves a great deal. With payroll and accounting in one system, the payroll journal posts to cost centers automatically and labour cost shows up in project and branch profitability without re-keying.
How does the system handle long sick leave?
It counts days used in the year and applies full pay for the first 30, three-quarters for the next 60 and no pay for the following 30, reflecting it in payroll automatically.
Why do document expiry alerts matter so much in Saudi Arabia?
They stop iqamas, licences and medical insurance from lapsing unnoticed, which would block the employee's transactions or expose the company to penalties.
What does Tranquil offer for HR?
Employee management, time and attendance, scheduling and timesheets, payroll, employee self-service, document expiry alerts, geo-fencing, and bank and Muqeem integration. Contact the Tranquil team for a demo suited to your company.