End of Service Calculator — Saudi Arabia
This end of service calculator Saudi Arabia employees and employers use works out your End of Service Benefits (EOSB) exactly as the Saudi Labor Law sets them out: half a month’s wage for each of the first five years and a full month’s wage for every year after, calculated on your last actual wage — basic salary plus fixed allowances — with the Article 85 resignation fractions applied when you are the one who left.
- First 5 years
- ½ month’s wage per year
- After 5 years
- 1 month’s wage per year
- Wage basis
- Last actual wage
- Maximum cap
- None
Your job and salary
Housing, transport and other fixed allowances combined. Saudi law calculates the award on your last actual wage — basic salary plus fixed allowances (Article 2) — not on basic salary alone. Commissions and variable pay belong here only if your contract counts them; a contract may exclude them under Article 86.
Service is counted in days from the joining date to the last working day, including the last day itself, and fractions of a year are paid pro-rata.
This decides whether you receive the full Article 84 award or the Article 85 resignation fractions — one third, two thirds, or nothing.
Actual wage vs basic salary only
How this end of service calculator works — your award, part by part
The award has two parts. For each of the first five years of service you earn half a month of your last actual wage; for every year after the fifth you earn a full month. The two parts are added together to give the full Article 84 award, and then the reason the job ended decides how much of it is actually paid: all of it when the employer ended the contract, or a fraction of it under Article 85 when you resigned.
The Article 84 formula for end of service benefits in Saudi Arabia
One formula for every private-sector employee. Article 84 of the Saudi Labor Law states the end of service award in a single rule: if the work relationship ends, the employer pays an award “calculated on the basis of a half month wage for each of the first five years and a month wage for each of the following years”, using the last wage, with fractions of a year paid in proportion. In symbols: award = wage × (0.5 × years up to 5, plus 1 × years beyond 5).
| Service period | Award for each year | Formula |
|---|---|---|
| Each of the first 5 years | Half a month’s actual wage | 0.5 × wage |
| Each year after the fifth | One month’s actual wage | 1 × wage |
| Fractions of a year | Paid pro-rata, by days of service | pro-rata |
The wage is your actual wage, not your basic salary. Article 2 of the Labor Law defines wages as everything paid to the employee, starting with basic salary and including fixed allowances such as housing and transport. An employee on SAR 8,000 basic with SAR 2,000 of fixed allowances has an award wage of SAR 10,000, and over eight years the difference between the two figures is SAR 11,000 of award. Article 86 allows a written contract to exclude commissions and other variable, percentage-based payments from the wage used here — but fixed allowances are wage, and leaving them out is the single most common EOSB underpayment.
There is no cap. Unlike the UAE, where the gratuity stops at two years of basic wage, Saudi Arabia sets no maximum on the award: twenty years of service at a SAR 20,000 wage produces SAR 350,000 — two and a half months of wage for the first five years and a full month for each of the other fifteen — and the figure keeps growing with every extra year.
Resigning? The Article 85 tiers — one third, two thirds, or the full award
Resignation reduces the award; it does not remove it. Article 85 pays a resigning employee a fraction of the full Article 84 award based on length of service. The fractions are deliberately steep at the start — resign inside your first two years and there is no award at all — then climb to the full award at ten years. Your tier, on your current dates, is highlighted in the table.
| Length of service when you resign | Entitlement | Share of the full award |
|---|
Boundary cases follow the statute exactly: exactly five years of service is still the one-third tier (“not more than five years”), and the two-thirds tier runs from just over five years to just under ten.
Two kinds of resignation keep the full award. If you resign for one of the reasons listed in Article 81 — for example the employer failed to pay your wages, assaulted you, or demanded work outside your contract — you keep the entire award, as you do if force majeure ends the job. Article 87 gives the same full award to a female employee who ends her contract within six months of marriage or three months of childbirth. Choose those reasons in the calculator above and the full Article 84 figure is paid.
If your employer is sold or privatized — who pays your award?
A change of owner does not reset your service. Article 18 of the Labor Law keeps every employment contract in force when a business is sold, merged or changes its legal form: your service is treated as continuous, and the previous and new owners are jointly liable for the rights you had already earned — unpaid wages and the end of service award accrued up to the transfer. That allocation is between the two owners; it does not change what you are owed, and the Article 84 calculation above is unaffected.
Privatization transfers now carry their own cost-splitting rule. For employees in sectors targeted for transformation and privatization, Article 18(3) of the Rules and Arrangements on the Manner of Treatment of Officers and Employees in the Sectors Targeted for Transformation and Privatization — issued by Council of Ministers Decision 616 of 1442H and amended by Council of Ministers Decision No. 318 of 4 Rabi Al-Thani 1448 (15 September 2026), published in the official gazette Umm Al-Qura, issue 5186, on 25 September 2026 — states that the employee’s service is considered continuous for the end of service gratuity and leave, and splits the cost at the transfer date: the supervising entity (the predecessor) bears the value of the gratuity and leave for the period of service before the transfer, calculated on the basis of the last wage, and the entity to which the employee is transferred (the successor) bears the value for the period after it, also calculated on the basis of the last wage. The detailed mechanism for the split is to be issued by the Board of Directors of the National Center for Privatization, in coordination with the Ministry of Finance and the Ministry of Human Resources and Social Development.
What this means for the figure above. The amendment changes who pays, not how much: your years before and after a privatization transfer are added together, the award is still the Article 84 amount on your last actual wage, and the calculator on this page gives the same total. If your employer is being privatized, keep your service records from the predecessor — its share is calculated on your last wage and is the predecessor’s responsibility under the amended rule.
Worked examples — Saudi end of service awards in practice
Nine years, employer ends the contract. Ahmed’s last actual wage is SAR 12,000 — SAR 9,000 basic plus SAR 3,000 of fixed allowances — and his fixed-term contract is not renewed after nine years. First five years: 12,000 × 0.5 × 5 = SAR 30,000. Following four years: 12,000 × 1 × 4 = SAR 48,000. Because the employer ended the contract, the full award is paid: SAR 78,000.
Seven and a half years, resigning — and the basic-salary mistake. Sara earns SAR 8,000 basic plus SAR 2,000 of fixed allowances, an actual wage of SAR 10,000, and resigns after 7.5 years. Her full Article 84 award is 10,000 × (0.5 × 5 + 1 × 2.5) = SAR 50,000, and the Article 85 two-thirds tier pays her SAR 33,333.33. Had the award been worked out on her basic salary alone, the same calculation would give SAR 40,000 in full and only SAR 26,666.67 on resignation — SAR 6,666.66 less, lost purely to the wrong wage figure.
Three years, resigning. Omar earns SAR 6,000 a month with no allowances and resigns after three years. The full award would be 6,000 × 0.5 × 3 = SAR 9,000; the Article 85 one-third tier pays him SAR 3,000. Resigning a year and a half earlier, at 1.5 years, would have paid nothing at all — while a termination by his employer at the same three-year point would have paid the full SAR 9,000.
How we calculate — method and sources
This end of service calculator follows the Saudi Labor Law step by step:
- Find the actual wage. Basic monthly salary plus fixed monthly allowances, per the definition of wages in Article 2. Commissions and variable payments are left out unless your contract counts them, which Article 86 permits a contract to decide.
- Count the service. Completed years, months and days from the joining date to the last working day, counting the last day as a day worked; months count as twelfths of a year and leftover days at 1/365 of a year, so fractions of a year are paid pro-rata, as Article 84 requires. Probation time counts toward your service; training or apprenticeship time does not.
- Apply Article 84. Full award = wage × (0.5 × the first five years, plus 1 × every year beyond five). There is no statutory maximum.
- Apply the reason for leaving. Full award when the employer ends the contract or a fixed term expires, and for Article 81 and Article 87 resignations; on an ordinary resignation, the Article 85 fractions — nothing under two years, one third from two to five years, two thirds from over five to under ten years, the full award at ten years.
- Settlement timing. Under Article 88 the employer must settle wages and the award within one week when the employer ended the contract, and within two weeks when the employee ended it.
The award formula, the wage definition, the resignation fractions and the settlement deadlines are taken from the Saudi Labor Law promulgated by Royal Decree No. M/51 — Articles 2, 84, 85, 86, 87 and 88 — and cross-checked against the ministry guidance listed in the sources below. Figures were verified on 22 October 2026.
End of service calculator Saudi Arabia — common questions
How is the end of service benefit calculated in Saudi Arabia?
Under Article 84 of the Saudi Labor Law, the award is half a month’s wage for each of the first five years of service and one month’s wage for each year after that, calculated on your last actual wage — basic salary plus fixed allowances. Fractions of a year are paid pro-rata. If your employer ended the contract, or a fixed-term contract expired, the full award is paid; if you resigned, the Article 85 fractions apply instead.
Is the end of service benefit calculated on basic salary or full salary?
On your last actual wage. Article 2 of the Labor Law defines wages as basic salary plus fixed allowances such as housing and transport. Calculating on basic salary alone is the most common EOSB mistake and can cut the award by thousands of riyals. Commissions and other variable payments count too, unless your contract excludes them under Article 86.
How much end of service benefit do I get if I resign?
Under Article 85, an employee who resigns gets nothing with less than two years of service, one third of the full award with two to five years, two thirds with more than five but less than ten years, and the full award at ten years or more. Resigning for a reason listed in Article 81 — or, for women, ending the contract within six months of marriage or three months of childbirth under Article 87 — keeps the full award.
Is there a maximum cap on end of service benefits in Saudi Arabia?
No. Saudi Arabia sets no cap on the EOSB award, however long you worked or however high your wage. This differs from the UAE, where the gratuity is capped at two years of basic wage. A 20-year employee in Saudi Arabia is paid for all 20 years: two and a half months of wage for the first five years and a full month for each of the other fifteen.
When must my employer pay my end of service award?
Article 88 of the Labor Law gives your employer one week from the end of the contract to settle your wages and award if the employer ended the contract, and two weeks if you ended it. The award is a single one-off payment, separate from any GOSI pension.
Can I lose my end of service award?
Yes, in one situation: if your employer dismisses you for a reason listed in Article 80 — such as assault, fraud or repeated absence without a valid reason after warnings — the award can be forfeited. Resigning, by contrast, only reduces the award under Article 85; it never removes it once you pass two years of service. Domestic workers are not covered by this calculator: they have a separate regulation with different rules.
What happens to my end-of-service award if my company is privatized or sold?
Your award is protected in both cases, and your service is treated as continuous. If a private company is sold or merged, Article 18 of the Labor Law keeps your contract in force, and the previous and new owners are jointly liable for the award you accrued before the sale, so it can be claimed from either of them. If your employer is a government entity or sector being privatized, the amended Article 18(3) of the privatization employee-treatment rules (Council of Ministers Decision 616 of 1442H, as amended by Decision No. 318 of 4/4/1448H / 15 September 2026 and published in Umm Al-Qura issue 5186 on 25 September 2026) splits the cost at the transfer date: the supervising entity bears the gratuity and leave value for your service before the transfer, and the entity you are transferred to bears the value for your service after it — both calculated on your last wage, under a mechanism still to be issued by the National Center for Privatization. Either way, the Article 84 amount itself does not change; use the calculator above for the total.
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