HR and payroll in the Gulf

Does an employee who resigns get the end-of-service award in Saudi Arabia?

By Mahmoud SaiedLast updated 27 October 20262 min read

The short answer

Yes, after two consecutive years of service: Article 85 of the Labor Law gives one third, two thirds or the full award depending on length of service. Article 87 sets cases where the full award is due, and an employee who leaves in one of the cases in Article 81 keeps all statutory rights.

Step by step

  1. 1

    Calculate the full award first

    Half a month's wage for each of the first five years and a month's wage for each year after, on the last wage, under Article 84.

  2. 2

    Apply the resignation share

    Under two years: nothing. Two consecutive years up to and including five years: one third. More than five and under ten: two thirds. Ten years or more: the full award.

  3. 3

    Check the Article 87 exceptions

    The full award is due when the employee leaves because of force majeure beyond their control, or when a female employee ends the contract within six months of her marriage contract or three months of giving birth.

  4. 4

    Check the Article 81 cases

    The article lists cases in which the employee may leave without notice and keep all statutory rights, including the employer's breach of essential contractual or statutory obligations, an assault on the employee, or conduct that pushes the employee to appear as the one ending the contract.

  5. 5

    Follow the resignation procedure

    A resignation is deemed accepted after 30 days without a reply. The employer may defer acceptance for up to 60 days when work needs require, with a reasoned written explanation, and the employee may withdraw it within 7 days of submitting it unless it has been accepted, under Article 79 bis.

  6. 6

    Settle on time

    The employer must settle the rights of an employee who resigned within two weeks at most, under Article 88.

A common mistake

Paying one third of the award to a female employee who resigned within six months of her marriage or three months of giving birth is a common mistake, because Article 87 gives her the full award.

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