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 a month's wage for each later year, with part years in proportion. It is based on the last wage, meaning the actual wage, and is due within a week of the contract ending, or two weeks if the worker ended it.
What does that look like in numbers?
For five years or less, the award is the number of years times half a month's wage. Past five years, add a full month's wage for every further year. On a last wage of SAR 8,000 a month, five years gives 5 × SAR 4,000 = SAR 20,000, and eight years gives SAR 20,000 plus 3 × SAR 8,000 = SAR 44,000. These are the full awards, paid when the employer ends the contract or a fixed term runs out.
| Service | Award | In rupees |
|---|---|---|
| 3 years | SAR 12,000.00 | PKR 885,049 |
| 5 years | SAR 20,000.00 | PKR 1,475,082 |
| 8 years | SAR 44,000.00 | PKR 3,245,180 |
| 12 years | SAR 76,000.00 | PKR 5,605,310 |
The calculator does the same sum for your own dates, including the part year.
Which wage is the award based on?
Article 84 says the last wage received is the basis. Article 2 then says that "wage" means the actual wage: the basic wage plus the other increases due to the worker for the work, under the contract or the work regulations. The definition names, among others, commission and percentages of sales or profit, allowances for effort or risk, increases for the cost of living or family burdens, and bonuses that the contract or custom provides for.
Two exceptions matter. Article 86 allows the worker and employer to agree that commissions and similar variable pay are left out of the wage used for the award. Article 96 says that piece rate pay is averaged over the actual working days of the last year of service. Housing and transport allowances are not named in Article 2; whether a cash allowance counts can depend on the contract, so check yours.
How are part years and months counted?
Part years are paid in proportion to the time worked (Article 84). A month means thirty days unless the contract or the work regulations say otherwise (Article 2). Article 10 says periods in the law are counted in the Hijri calendar unless the contract or the work regulations say otherwise; the ministry's unified contract template uses the Gregorian calendar (clause 14.6). A Hijri year is about eleven days shorter than a Gregorian one, which matters most for workers close to the two, five or ten year lines.
Does the reason the contract ended change the amount?
Yes. The full award is paid when the employer ends the contract or a fixed term expires. If the worker resigns, Article 85 pays nothing under two years of continuous service, one third from two to five years, two thirds above five and below ten, and the full award from ten years. Article 87 keeps the full award in cases of force majeure, and for a woman who ends her contract within six months of her marriage contract or three months of giving birth. Dismissal under one of the nine cases of Article 80, and the end of a contract during probation, carry no award.
The details are on does resigning reduce end of service.
When must it be paid, and can anything be taken off?
Article 88 gives the employer one week at most from the end of the contract to pay the wage and settle the worker's rights, or two weeks if the worker ended the contract. The employer may deduct any debt the worker owes because of the work.
Did the 2025 changes to the Labor Law change this?
No. Royal Decree M/44 was published in Umm Al Qura on 23 August 2024 and came into force 180 days later, in February 2025. Its 39 items amend, add or repeal many articles, including notice periods (Article 75) and probation (Article 53), and add a definition of resignation and a new Article 79 bis on how a resignation is accepted. None of them touches Articles 84 to 88 or the wage definitions in Article 2.
Who is not covered?
Domestic workers are outside the Labor Law (Article 7) and have their own regulation with a different award. Workers on the flexible work system have no end of service award under the implementing regulations.
Sources
- Saudi Labor Law, Articles 84 to 88 (HRSD consolidated English text), checked 18 October 2026
- Saudi Labor Law, Article 2 definitions (HRSD), checked 18 October 2026
- Saudi Labor Law, Article 96 (HRSD), checked 18 October 2026
- Royal Decree M/44, publication and entry into force, Umm Al Qura, checked 18 October 2026
- Royal Decree M/44 of 8/2/1446H amending the Labor Law, Umm Al Qura, checked 18 October 2026
- Implementing Regulations of the Labor Law with the unified contract (HRSD, PDF), checked 18 October 2026
Last checked 18 October 2026. Rates on this page are from 8 November 2026 and are refreshed daily. If a rule here has changed, the official source wins.