Saudi end-of-service benefit calculator
Work out the end-of-service award under the Saudi Labour Law from wage, years and months of service and the reason for leaving, with the Article 85 resignation tiers applied and the monthly accrual to book.
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Sources
The formula, in one line
Article 84 of the Labour Law gives half a month's wage for each of the first five years of service and a full month's wage for each year after that, with a fraction of a year counted in proportion. Ten years on SAR 8,000 is 5 × 4,000 plus 5 × 8,000, or SAR 60,000.
On resignation Article 85 reduces it: nothing under two years, one third from two to five years, two thirds from five to ten, and the full amount from ten years. Termination by the employer without a cause attributable to the employee pays the full award.
What to book each month
The award is a liability that builds every month the employee works, so it belongs in the ledger before anyone leaves. The monthly accrual is the wage divided by 24 in the first five years and by 12 after that, debited to end-of-service expense and credited to the provision.
When the wage rises the whole accumulated provision is remeasured, because the award is paid on the last wage. Skyline Nexus ERP's HR and accounting modules post the accrual and the remeasurement for you each payroll run.
Common questions
Which wage is used: basic or total?
The last wage, which under the Labour Law includes the basic wage and fixed allowances that are part of the wage, such as housing. Check your contract wording and the ministry's guidance, and enter the figure your payroll uses for end-of-service.
Does a fraction of a year count?
Yes, in proportion. Seven years and six months is 7.5 years: five at half a month plus 2.5 at a full month.
What if the employee resigns after exactly five years?
The fact sheet we work from puts two to five years at one third and five to ten at two thirds; this calculator treats exactly five years as the one-third tier. Confirm borderline cases with the authority before paying.
Is the accrual different from the amount payable?
Yes. The provision is built on the full Article 84 award because most exits pay it; the Article 85 reduction on resignation is a release of provision at the time of leaving.
Does this calculator upload anything?
No. The arithmetic runs in your browser. Only the optional form at the bottom sends anything, and only if you choose to email yourself the result.
Email me this result as a PDF
Leave your name and work email and we send you a printable copy of this result, with a note on how Skyline Nexus ERP books the same figure automatically each month.