How Saudi End of Service is Calculated
Saudi Arabia's Labour Law (Article 84) entitles all workers — Saudi nationals and expats alike — to an end of service award when their employment ends. The formula differs from UAE's: Saudi uses half a month's salary per year for the first 5 years, and a full month per year thereafter.
The Formula
- For each of the first 5 years: ½ month's salary per year
- For each year beyond 5: 1 full month's salary per year
- Apply resignation reduction if applicable
Resignation Rules — Saudi Labour Law
| Service Period | Terminated | Resigned |
|---|---|---|
| Under 2 years | Full award | No award |
| 2–5 years | Full award | 1/3 of award |
| 5–10 years | Full award | 2/3 of award |
| 10+ years | Full award | Full award |
Key Rules for Expats in Saudi Arabia
The award must be paid within 30 days of the last working day. Saudi law also entitles employees to airfare home (repatriation ticket) when their employment ends, which is separate from the end of service award.
Disputes can be filed with the Saudi Ministry of Human Resources and Social Development. The Absher portal provides online complaint mechanisms for workers.
Frequently Asked Questions
No. Like the UAE, Saudi Arabia calculates the end of service award based on basic wage only. Housing, transport and other allowances are excluded.
After 2–5 years' service on resignation, you receive one third (1/3) of the full calculated award. So for 3 years at SAR 5,000/month: full award = SAR 7,500. On resignation = SAR 2,500.
Yes — they are the same entitlement referred to by different names. "End of service award", "end of service benefit", and "gratuity" all refer to the payment due at the end of employment under Article 84 of the Saudi Labour Law.