End-of-service award
Also known as: EOSB · end of service benefit · مكافأة نهاية الخدمة
The end-of-service award is the sum an employer pays a worker when employment ends, under Article 84 of the Saudi Labour Law: half a month’s wage for each of the first five years and a month’s wage for each year after, on the last actual wage. On resignation Article 85 reduces it by length of service.
On resignation (Article 85)
| Service | What the worker gets |
|---|---|
| Under two years | Nothing |
| Two to five years | One third |
| Over five and under ten years | Two thirds |
| Ten years or more | The full award |
Example
Seven years of service, a last actual wage of 10,000 SAR, contract ended by the employer: (5 × 5,000) + (2 × 10,000) = 45,000 SAR. On resignation the worker would get two thirds: 30,000 SAR.
What it means for HR
- Calculate on the actual wage (basic plus allowances), not on basic alone.
- Record the reason employment ended accurately; it decides which article applies.
Use the end-of-service calculator, and read the end-of-service guide.
Official sources
This is general information to help you understand the topic. It is not legal advice. Rules and rates change: always check the official text on the relevant authority’s platform and consult a qualified adviser before acting.
