Saudi Labour Law Article 85: end-of-service award on resignation
Not changed by the 2025 amendments
Article 85 of the Saudi Labour Law reduces the end-of-service award when the worker resigns: nothing for under two years of service, one third for two to five years, two thirds for more than five and under ten years, and the full award for ten years or more.
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.
What Article 85 says
When employment ends because the worker resigns, the award calculated under Article 84 is paid in part:
| Continuous service | Share of the award |
|---|---|
| Under 2 years | Nothing |
| 2 to 5 years | One third |
| More than 5 and under 10 years | Two thirds |
| 10 years or more | The full award |
Was it changed in 2025?
No. Article 85 is not among the articles the 2025 amendments changed, according to the ministry’s summary of the amendments. What did change is the resignation procedure: Article 79 bis now sets a 30-day deadline for the employer to answer and lets the worker withdraw within seven days. A worker who resigns receives all their rights under the law, which for the award means Article 85.
Worked examples
3 years and 6 months, last actual wage 8,000 SAR
- Full award: 3.5 × (8,000 ÷ 2) = 14,000 SAR
- One third on resignation: 14,000 ÷ 3 = 4,666.67 SAR
9 years, last actual wage 9,000 SAR
- Full award: (5 × 4,500) + (4 × 9,000) = 22,500 + 36,000 = 58,500 SAR
- Two thirds on resignation: 58,500 × 2 ÷ 3 = 39,000 SAR
What is not a resignation
- Leaving under Article 81, because the employer broke its obligations, keeps all the worker’s rights.
- Dismissal by the employer, expiry of a fixed term, or closure are not resignations; the full award under Article 84 is the starting point.
What HR should do
- Confirm the resignation in writing through the proper channel, and record the date the contract actually ended.
- Count continuous service to the day; the thresholds at 2, 5 and 10 years are exact.
- Check Article 87 before applying the reduction.
- Pay the final settlement within two weeks when the worker ends the contract (Article 88).
Work out any case with the end-of-service calculator. This page is a general explanation, not legal advice.
Official sources
Frequently asked questions
Does a worker who resigns before two years get anything?
No end-of-service award. The worker is still owed wages to the last day and pay for unused annual leave.
Is the one third taken from the whole award or only part of it?
From the whole award: first calculate the award for the full period of service under Article 84, then apply one third, two thirds or the full amount according to the length of service.
When does a resigning worker get the full award?
After ten years or more of service, and in the cases in Article 87: leaving because of force majeure, and a woman who ends her contract within six months of marriage or three months of giving birth.
