End of service calculator for expats in Saudi Arabia: the rules
Why expatriates get the end-of-service award under the same Labour Law rules as Saudis, why it comes from the employer and not GOSI, and the order of the final settlement and final exit.
Last updated · 3 min read
Expatriates in Saudi Arabia receive the end-of-service award under the same Labour Law rules as Saudis: half a month's last actual wage for each of the first five years, a full month after that, reduced on resignation (Articles 84 and 85). The employer pays it directly; GOSI pays non-Saudis no end-of-service benefit.
Key takeaways
- The Labour Law's end-of-service rules apply to Saudi and non-Saudi workers alike.
- For non-Saudis, GOSI covers occupational hazards only, so the award is the employer's cost, paid directly.
- When a fixed-term contract expires, the full award is due.
- Settle and pay first, deregister from GOSI, then issue the final exit visa.
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.
Many expatriate employees, and some employers, assume the end-of-service award works differently for non-Saudis. It does not. The award is a Labour Law entitlement for every worker the law covers, and the calculation is the same. What is different for expatriates is where the money comes from, and the steps around a final exit.
The same rules as for Saudis
The end-of-service award under Article 84 is:
- half a month's last actual wage for each of the first five years; and
- a full month's wage for each year after the fifth, with part-years pro rata.
The full award is due when the employer ends the contract (outside the Article 80 cases) and when a fixed-term contract expires, which matters because many expatriate contracts are fixed-term. If the employee resigns, Article 85 applies: nothing under 2 years, one third from 2 to 5, two thirds over 5 and under 10, the full award from 10 years. See end of service on resignation.
Why GOSI does not pay it
For Saudi employees, GOSI runs annuities and SANED. For non-Saudi employees, GOSI covers occupational hazards only, paid by the employer at 2% of the contributory wage; nothing is deducted from the employee. There is no GOSI pension, lump sum or end-of-service payment for expatriates. The award is therefore a liability the employer should provide for each month and pay directly at the end of service. See GOSI for non-Saudis.
Worked example
An expatriate accountant's fixed-term contract expires after 8 years. Basic wage 5,000 SAR, housing 1,250 SAR, transport 750 SAR: last actual wage 7,000 SAR. 12 days of annual leave are unused.
- First 5 years: 5 × 0.5 × 7,000 = 17,500 SAR
- Next 3 years: 3 × 1 × 7,000 = 21,000 SAR
- Award (contract expiry, full award): 38,500 SAR
- Unused leave: 7,000 ÷ 30 × 12 = 2,800 SAR
If the same employee had resigned after 8 years, the award would be two thirds: 38,500 × 2 ÷ 3 = 25,666.67 SAR.
A common error is to use only the basic wage. On 5,000 SAR, the award would come to 27,500 SAR, understating it by 11,000 SAR.
The order of steps at the end of service
- End the contract on Qiwa and record the reason employment ended, because it decides the fraction.
- Calculate the final settlement: wages to the last day, the award, unused leave and any notice pay, minus lawful debts.
- Pay by bank transfer within one week, or two weeks if the employee ended the contract (Article 88), and have the employee sign the settlement.
- Deregister the employee from GOSI so they drop off the next invoice.
- Issue the final exit visa through Muqeem or Absher Business. A final exit is hard to undo, so make it the last step.
If the employee is moving to another employer in Saudi Arabia instead of leaving the country, the move is a transfer of services on Qiwa, and the settlement with the first employer follows the same rules on how the contract ended.
Estimating the award
Use the end-of-service calculator: it applies the same rules to expatriates. To see the full annual cost of an expatriate employee, including the levy, GOSI and end of service, use the expat cost calculator.
How RafiqHR helps
RafiqHR calculates the award and the final settlement from each employee's contract and salary history, ties the settlement to clearance, and keeps iqamas, visas and exit re-entry in one work queue, so HR can see what is outstanding before a final exit is issued.
Frequently asked questions
Do expats get end of service in Saudi Arabia?
Yes. The end-of-service award in Articles 84 to 88 of the Labour Law applies to every worker covered by the law, whatever their nationality. The amount depends on length of service, the last actual wage and how the contract ended.
Does GOSI pay end of service to non-Saudi employees?
No. Non-Saudi employees are covered by GOSI only for occupational hazards, which the employer pays at 2% of the contributory wage. There is no GOSI pension or end-of-service payment for them; the award is paid by the employer.
Should the award be paid before the final exit visa?
In practice, yes. The usual order is to end the contract on Qiwa, calculate and pay the final settlement including the award, have the employee sign it, deregister them from GOSI, and then issue the final exit visa through Muqeem or Absher Business.
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.
