COUNTRY POLICY

Kingdom of Saudi Arabia

Legal Company: Nokia Siemens Networks Al-Saudia.

C.R. 1010162642
Owner: Country HR
Approved By: Nokia Siemens Networks Al-Saudia Senior Management
st,
Status: Effective May 1 2013
NSN Al-Saudia Country Policy
1.05.2013, Version 2.0.

Objective
The HR Country Policy is intended principally for the use of all Nokia Siemens Networks Al-Saudia
(NSN Al-Saudia) employees so that they can be clear about their rights and obligations.

The prime objective of this document is to streamline and regulate human resources related
processes and practices regarding the full employment life cycle.

This policy is valid for all NSN Al-Saudia employees. In all cases, the country policy, as with other
human resources policies, is intended to be consistent with the prevailing Kingdom of Saudi Arabia
(KSA) laws and regulations. However, in the event when the language contained in the country
policy conflicts with the KSA laws or regulations, the KSA laws or regulations will prevail. Practices
and policies that are not discussed by the country policy are regulated by KSA Labor Law.

NSN Al-Saudia reserves the right to revise the content of the country policy as a whole or in part,
without notice. Unless more frequent revisions are needed, the policy will be reviewed every
calendar year.

Responsibilities, authorization and availability

The KSA Human Resources Team has the ownership and is responsible for updating the country
policy. The country policy and its revisions must be approved by the Country Management Team.

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I. Employment Contract
Pre-requisite for employment
The employment contract for a Non-Saudi national employee is subject to the issuance, and
continued re-issuance, of a work visa. The application is to be approved by the Ministry of Labor
and Ministry of Foreign Affairs before the employee enters the KSA.
Any exceptions for employee entry (employment initiation with NSN Al-Saudia) prior the work
permit issuance (with business visa) needs to be approved by the HR and the Administration
Manager.

Employment of Saudi nationals is subject to the registration in the General Organization for
Social Insurance (GOSI).

Employment Contract type

All employees should sign an employment contract detailing the terms and conditions of their
employment.

Certain positions may be contracted on a monthly basis or on a fixed-time basis based on

proper justifications and recommended by the Line Manager and approved by the HR Manager.

An employment contract will be cancelled without notice, indemnity or compensation; if at any

time it was revealed to the management that the concerned employee has claimed a false
identity or submitted incorrect information/ forged documents (i.e. professional qualifications,
experience letters) in its initial job application.

Probation period
The probationary period is an important opportunity for performance and conduct to be
assessed to determine whether the employee can be confirmed in the proposed position.
The probation period must be clearly stated in the employment contract. The probation period
starts on the employee’s first joining date.
Promotion, salary increase, and bonuses will not be granted for employees under the probation
period.
All new hired employees who are paid on monthly basis will be placed under probationary
period of three (3) months excluding Eid Al-Adha and Eid al-Fitir vacations and sick leaves.
The employee will not be placed on a probation period more than once throughout his / her
employment unless it is for another position or job.
Other than in case of emergencies, the employee shall not be entitled to any kind of leave
during the probation period.
The employee’s Functional Manager must appraise the new employee before the end of the
three months probationary employment to assess his / her performance during this period.
During the probation period either the employer or the employee may terminate the
employment contract with immediate effect.

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Remuneration
Remuneration is paid to the employee in return for his/her services under an employment
contract.
“Total Compensation (TC)” includes base salary and benefits provided. The elements of the
total compensation are specified in the employee contract or the approved offer letter.
All Salaries are paid in Saudi Arabian Riyals (SAR).

Bonus
The award of a bonus will be considered if the company has achieved its annual financial
targets.
The bonus will be distributed among the employees based on the result of the employees’
annual performance evaluation (PE).
The following should be the main objectives of a bonus scheme:
 Encourage and motivate individuals to focus on business priorities;
 Make employees more aware of the factors that govern NSN Al-Saudia’s
performance;
 Reward personnel commitment and success;
 Enable the employees to share NSN Al-Saudia’s success; and
 Reflect market practice and help recruit and retain high caliber people at NSN Al-
Saudia

Restrictions
1. The Ministry of Labor and the Ministry of Foreign Affairs maintain specific quotas for
the KSA work permits per nationality, profession and respective education. The
Recruitment Manager is responsible to confirm with the Administration Manager that the
required work permit is available from the Saudi authorities.
2. For a close relative relation, Recruiting Manager is responsible to notify the HR on the
relation for approval to proceed with recruitment.
3. Siblings (brothers/sisters) are allowed to work for the company only if they are not
employed in the same team and they do not have any reporting relationship to each other.

Tax liability
Currently personal income in the KSA is tax exempted. Employees are liable for any personal
income taxation in future in the KSA and/or their home country taxation liabilities. NSN Al-
Saudia is not liable for any personal income taxation of its employees.

II. Working hours and overtime

Working hours
Minimum weekly working hours are 40 hours a week and maximum are 48 hours a week.

Normal working hours are sliding 9 hours per day, between 8:00 am and 9:00 am until 5:00 pm
and 6:00 pm, with 60 minutes lunch break and adequate breaks for prayer.

All employees should be at work in the core time from 9:00 am to 5:00 pm. Deviations from
these core time hours have to be agreed with the solid Functional Manager, including the
specific shift work employees. Documentation of approvals should exist for further reference.
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Overtime
Employees in positions with job grade 8 and below are entitled to additional compensation if
requested to do overtime work.
Employees in positions with job grade 9 and above are not eligible for overtime
compensation.
Further details about overtime compensation and eligibility are elucidated in the NSN Al-
Saudia Overtime Policy with Human Resources.

Ramadan working hours

During the month of Ramadan, the actual working hours for Muslims shall be reduced to a
maximum of six hours a day or thirty-six hours a week.

KSA Official and Company Specific Holidays

An employee is entitled to an official holiday with full wage for the following occasions:

1 National Day of the KSA (23rd September) One working day

th
2 Christmas Day (25 December) One calendar day
st
3 Gregorian New Year’s Day (1 January) One calendar day
4 Eid Al Fitr (end of Ramadan) Four working days
5 Eid Al Adha Four working days

With regards to Islamic holidays, The HR team will follow the government announcement which
is usually confirmed prior to the holiday occurrence. As the timing of the Islamic holidays
depends on the actual sightings of the moon, announcement of the holiday may only happen 1
to 3 days prior to the holiday.

Social security
The company pays contributions to the social security scheme in a form of General
Organization of Social Insurance (GOSI) payment for its employees according to the KSA
Social Insurance Law.

Healthcare and Medical Expenses

The company provides medical healthcare insurance for each of its employees.
Also for the employees who are under a married-status contract, their direct family members
(spouse and children) medical healthcare insurance is supported by the company.
Employee should apply for Medical insurance to HR immediately upon arrival of KSA with
relevant documents. If there is any extra cost from medical insurance company due to late
addition employee has to bear it.

The terms and conditions of the insurance provider should be followed while obtaining medical
assistance.
Note the following:
Employee should familiarize with the exclusion items in the insurance policy.
The mandated visit contribution by the insurance service provider is to be detained by the
employee personal expenses.

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Medical Emergency Travel Insurance

The company provides travel insurance for employees who are required to travel abroad for
business.

III. Leaves
An employee shall be entitled to a paid annual leave of not less than twenty two (22) working
days, to be increased to a period of not less than thirty working days if the worker spends five
consecutive years in the service of the employer.
For the External Temporary Labor (ETL) employees annual leaves are elucidated in their
employment contract/agreed job offer.

Employees are not eligible to take leave during the probation period. In case it is justified, they
may take unpaid leave with the approval of their solid Line Manager and HR Manager.

Public Holidays will not be considered as part of the leave days if such holidays fall on a working
day during which the employee was on leave.

Annual leave has to be taken in the year when it is due. An employer may postpone, for a
period of not more than ninety days, the worker’s leave after the end of the year it is due if
required by work conditions. If work conditions require extension of the postponement, the
worker’s consent must be obtained in writing.
Maximum fifteen (15) remaining leave days may be carried forward to the following year, but
these leave days have to be taken before 31 March of the following year.

Solid Line Managers are responsible to prepare leave plans for their employees, at least every
6-month period. Also to make sure that their employees can take their annual leave, and that a
proper substitution is agreed on and communicated to appropriate stakeholders to support
business continuity. Leave requests shall be submitted to the solid Line Manager at least 10
working days before the planned leave take place.

Only in case of termination/resignation the employee will be entitled to receive compensation for
the annual leave that was already due but was not taken (business reasons, i.e. handover of job
to successor may not permit the employee to make use of his/her remaining leave).

Sick Leave
A medical certificate must be presented to the employer every time when employee is absent
(for 3 consecutive days or more) due to an illness. Medical certificate (by the registered medical
practitioner accredited by the Medical Insurance Company) is to be delivered to NSN Al-Saudia
HR. In case employee is unable to come to the workplace due to an illness, the employee is
required to report this to his solid Line Manager and HR before 10:30 am on the first business
day of such incapacity or illness.

Sick Leave compensated wage

Employee is entitled to full payment during the first 30 days of his sick leave and 75% of the
salary for the next 60 days. The employer will not compensate any amount of sick leave days
exceeding 90 days. The calculation of sick leave days is cumulative for one year period.

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Sick Leave (continued)

A single year shall mean the year which begins from the date of the first sick day.
Annual leave will be deducted automatically, if employee fails to submit copy of medical
certificate to the HR within one (1) week after the employee has returned to work.

Compassionate Leave
Employee is entitled to compassionate leave in case of death of immediate relative/family
member (child, spouse, mother, father, sister, brother, grandmother, grandfather). Leave is
three (3) days and relevant certificates need to be presented to HR and/or solid line manager
(i.e. relationship and death certificate).

Marriage Leave
Employee is entitled to three(3) days paid leave in addition to their normal annual leave
entitlement on their marriage.

Paternity Leave
Employee is entitled to paternity leave upon his wife giving birth to a newborn baby. Leave is
1 (one) day and relevant certificates need to be presented to HR and/or solid line manager
(birth certificate).

Hajj Leave
All Muslim employees are entitled to take a paid leave for Hajj not exceeding 10 calendar
days (including Eid Al Adha) once during the period of employment. This leave is not
considered as part of the annual leave entitlement. This leave is subject to the completion of
two years of continuous employment.
The Hajj leave has to be approved by the solid Line Manager at least 6 weeks prior to the
planned start of the leave.
The employer may determine the number of workers who shall be given the Hajj leave
annually in accordance with work requirements.

IV. Employment of Women

Maternity Leave
A female worker shall be entitled to a maternity leave for the four weeks immediately
preceding the expected date of delivery and the subsequent six weeks after delivery. The
probable date of delivery shall be determined by the physician of the firm or pursuant to a
medical report certified by a health authority. A woman may not work during the six weeks
immediately following delivery.

During the maternity leave, an employer shall pay the female worker half her wage if she has
been in his service for one year or more, and a full wage if she has served for three years or
more as of the date of commencement of such leave.

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Maternity Leave (continued)

A female worker shall not be paid any wages during her regular annual leave if she has enjoyed
in the same year a maternity leave with full wage. She shall be paid half her wage during the
annual leave if she has enjoyed in the same year a maternity leave at half wage.

Compassionate Leave
A female worker whose husband passes away shall be entitled to a fully paid leave for a
minimum period of fifteen days as of the date of death.

V. Compensation and Benefits

Salaries and Benefits
NSN Al-Saudia is committed to providing its employees with fair and competitive
compensation & benefits package that enables the Company to attract and retain highly
skilled and talented employees for all positions.
NSN Al-Saudia determines the overall level of salaries based on information about salaries
paid by other companies, similar to NSN Al-Saudia in business and in size, in the market for
the available pool of talent.
All employees will be compensated in accordance with their written, approved employment
contract or agreed offer letters for services provided.
The basic salary of the employee will be determined based on NSN Al-Saudia’s
Compensation and Benefits Structure. All employees will be classified into grades based on
their job responsibilities and duties as well as their qualifications as per NSN Al-Saudia’s
Compensation and Benefits Structure.

Payroll
All payments to an employee, where possible and feasible, should be made by means of a
bank transfer to the employee’s bank account with a bank in the KSA. An employee should
therefore open a bank account as soon as possible after his/her employment.
All salaries are paid on a monthly basis.
All payments to employees are advised by means of a salary slip containing all payments and
deductions.

Transportation allowance
The Company provides employees transportation allowance in accordance to the employees
job grades as per the Compensation & Benefits Structure.
Transportation allowance covers all transportation related costs, including fuel cost. No
separate fuel reimbursement is done, except for work-related domestic travel claims as per
kilometer allowance.
Transportation allowance is paid on a monthly basis to the employee’s bank account together
with the monthly base salary.
Transportation allowance will not be applicable to the employees using company provided
work- related transportation.

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Temporary Accommodation
Employees are provided with accommodation in a serviced apartment upon arrival to the country
for the first 2 weeks of employment.
The housing allowance entitlement will start only when an employee moves out of the company
paid temporary accommodation.

Housing Allowance
The company provides each employee a contribution towards housing costs. The purpose
of the housing allowance is to provide adequate financial support for employees to be able to
find suitable accommodation; however the housing allowance provided by the company
does not aim to cover all incurred cost. The housing cash allowance is paid on a monthly or
bi-annual basis with payroll.
The employee is responsible for signing the rental agreement with the landlord and shall pay
the rent, and any other related fees.

Method of Housing Cash Allowance

1) Monthly cash allowance payment

Monthly cash payment of the housing allowance is the default option which will be paid in
12 equal installments to the employee’s bank account together with the monthly salary.

2) Bi-annual cash allowance advance payment

Bi-annual advance payment of the housing allowance can be granted to employees upon their
request. Approval for this advance payment request needs to be taken from the solid Line
Manager and Business Operation Director.

Employee has to present a signed and valid rental contract to the HR Manager upon request.
The employee to fill in and sign the Housing Allowance Request and the Undertaking form
(Appendix 1). Following the proper documentation the bi-annual amount of the housing
allowance is transferred to the employee’s bank account by the payroll team with the next
payroll.

Considering payroll closing, the employee has to submit his request at least 15 calendar days
before the next payment date.

Upon termination of the contract the employee has to settle the balance of any outstanding
housing allowance. The amount is calculated by the payroll team on a pro-rata basis as part of
the calculation of the final settlement.

Annual home trip support

Company will provide the annual home trip support to its foreign employees.
Also for the employees who are under a married-status contract, their direct family members
(spouse and children) annual home trip support will be provided by the company.
For the External Temporary Labor (ETL) employees annual home trip support details are
elucidated in the employment contract/agreed job offer.

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Schooling Contribution
NSN Al-Saudia supports employee’s children schooling up to max of 3 children from age 4 to the
age of 18, provided the children are resident and studying in the KSA. Schooling contribution is
paid in accordance to the employees’ job grades as per the Compensation & Benefits Structure.
(Unless employment contract/agreed job offer does not state schooling contribution):

To activate schooling support, the employee has to inform HR with proof of admission for each
semester. The support is paid as monthly payroll payments.
Schooling contribution is not a cash benefit, therefore it cannot be redistributed and paid as
supplemental amount to other benefits such as housing or transportation allowance.

Business Travel Daily allowances and expense claims

Daily allowances are paid according to the NSN Al Saudia Travel policy, available with HR.

Communication Allowance
Employees are provided with a monthly communication allowance. The employee therefore has to
maintain mobile and valid SIM to be used for all work related matters.

On-boarding Entitlements
NSN Al-Saudia provides one-way air ticket for employees hired from outside the KSA.
Also for the employees who are under a married-status contract, their direct family members
(spouse and children) will be granted one-way air ticket by the company.

Visit Visa, Work Visa and Family Visa

Employee must submit the request for visa (visit, work, family) with all necessary documents to
the Administration Manager in order to take the relevant action. For Visa Instructions, kindly refer
to the HR team.

Note the following:

Company can arrange work visa only according to approved/allowed professions trades in the
KSA, if the candidate fulfilled all requirements.
Employees coming first time to Saudi Arabia must contact the Administration Manager as soon as
possible to process the issuance of Iqama.
Employees on visit visa must contact the Administration Manager at latest one week before the
expiry date of their visa.

» In case visit visa expire without extension, there is a penalty fee of 10,000SAR. (Employee will
be responsible of the fee in case it is due to delay in submission of visa extension or
submission of documents for issuance of Iqama)

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Visit Visa, Work Visa and Family Visa (continue)

NSN Al-Saudia covers the fees of 2 single exit-re-entry visa per year for its employees.
Also for the employees who are on a married-status contract, direct family members (spouse and
children) are entitled for 1 single exit-re-entry visa to support their annual home trip.
In case the employee wishes to get a multiple exit-reentry visa, this has to be applied via HR and
approved by the direct Line Manager supported with proper business need justification.
In case, the exit-re-entry visa expired without using it (within its intended time frame), there is a
penalty of 1,000SAR, for which employee is responsible.
In case of any exit-re-entry visa cancellation, the concerned employee will have to bear the
cancellation fee. (Single exit-re-entry visa 200SAR, multiple exit-re-entry visa 500SAR).

VI. Separation
Resignation
Employee and the company are required to give notice to one another in the event they wish to
terminate the employment contract.

Notice Period
The termination notice period is thirty (30) days, unless otherwise specified in the employment
contract.

Dismissals / Misconduct
The employer has the right to terminate the employment contract in accordance to the KSA Labor
Law in the following instances:

Force Majeure
Unforeseen circumstances beyond the control of the Employer (including but not limited to
political strife, acts of God, war, civil commotion, economic circumstances adversely affecting
the Employer’s business, such as loss of contracts with major clients, corporate downsizing and
similar circumstances);
The Company may terminate Employment Contract without notice and without payment in lieu of
notice and the end of service benefit in any of the following events:
1. Misconduct: If it was proved that the employee has committed a forgery to obtain his job hence
violation of the Employer Code of Conduct.
2. The KSA Labor Law: Such other reason(s) as provided in the KSA Labor Law.

De Facto Resignation
An employee who is absent without valid reason for more than twenty days in one year or for
more than ten consecutive days, provided that the dismissal be preceded by a written warning
from the employer to the worker if the latter is absent for ten days in the first case and for five
days in the second.

End of Service compensation

An employee who has completed two or more years of continuous service is entitled to severance
pay at the end of his employment. The days of absence from work without pay are not included in
calculating the period of service.
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End of Service compensation (continue)

The severance pay is calculated as half month salary for each of the first five years of service and
as 1 month salary for each additional year, using the latest monthly salary. Salary including the
last monthly basic pay, monthly transportation allowance and monthly equivalent of the housing
cash support.

Where an employee under an indefinite term contract terminates his employment at his own
initiative after a continuous service of not less than two years and not more than five years, he
shall be entitled to one-third of the severance pay. Such an employee shall be entitled to two
thirds of the said severance pay if his continuous service exceeds five years up to ten years and
to the full severance pay if his continuous service exceeds ten years.

Separation Procedures
Returning of Company Property
HR is responsible for preparing and providing a termination checklist to the employee.
The solid Line Manager in coordination with HR is responsible to arrange the return of Company
property according to the check list.
In order to receive a disbursement of any indemnities and end of service amounts due, the
employee and his solid Line Manager are required to complete and sign a termination checklist
form and submit it to HR.

Benefits
Benefits (housing allowance, schooling support, medical insurance, etc...) end on the last day of
employment.

Final Payment
Employees leaving the Company must return company assets, and signed termination checklist,
before information on their final settlement can be issued. Once the employee confirms the final
settlement, it will be paid to the employee’s bank account with the next payroll. If there are unpaid
obligations to the Company, the final settlement and payment will reflect the appropriate
deductions. The last month salary is also the part of the final settlement and paid at the same
time.

Repatriation expenses
NSN Al-Saudia will not compensate for any repatriation expenses to its employees other than the
provision of a return airfare ticket to the employee’s home country.
Also for the employees who are under a married-status contract, the company will compensate for
the provision of a home country return airfare ticket to the employee direct family members
(spouse and children).

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Appendix 1
UNDERTAKING

I, the undersigned, holder of Passport No ………………………, ID ……………………….,

employed with Nokia Siemens Networks Al-Saudia hereby unconditionally and irrevocably :

Undertake that in the event my employment with the Company is terminated or comes to an
end due to any reason, I shall on demand of the Company settle any balance outstanding
of my Housing allowance and prior to receipt of any entitlement (if any); and

declare that the Company has, notwithstanding anything contained herein, the right to deduct
forthwith without any notice any balance outstanding of the Housing allowance from my
severance pay or any amounts due to me; and

undertake that I will indemnify the Company in respect of any claims, costs, demands or
expenses which they may receive or incur as a result of any breach by me of the terms hereof
and/or my obligations contained in other documents relating to my employment relationship with
the Company.

Further, I hereby undertake that I will make no claim against the Company in respect of the
House loan or arising out of my employment relationship with the Company.

This letter is to be incorporated in and deemed to form part of my Contract of Employment and is
subject to and governed by the laws of the KSA.

Employee Signature Line Manager Signature

Date: Date:

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