EOS Benefit Upon Resignation - Conditions and Ratios

Published: July 2026 | 7 min read

One of the most common questions about EOS benefit is: what happens to the benefit if an employee resigns? This article explains the deduction ratios under Article 85 of Saudi Labor Law with practical examples for each service duration.

Article 85 - Resignation Deduction Ratios

Article 85 of Saudi Labor Law specifies the following ratios based on years of service:

Practical Examples

Example 1: Resignation after 3 years

Employee with SAR 12,000 basic salary, 3 years of service, resigns:

• Gross benefit: 12,000 × 3 × 0.5 = 18,000 SAR
• Ratio: One-third (1/3)
• Benefit due: 18,000 ÷ 3 = 6,000 SAR

Example 2: Resignation after 7 years

Employee with SAR 15,000 basic salary, 7 years of service, resigns:

• First 5 years: 15,000 × 5 × 0.5 = 37,500 SAR
• Next 2 years: 15,000 × 2 = 30,000 SAR
• Total: 67,500 SAR
• Ratio: Two-thirds (2/3)
• Benefit due: 67,500 × 2/3 = 45,000 SAR

Example 3: Resignation after 12 years

Employee with SAR 20,000 basic salary, 12 years of service, resigns:

• First 5 years: 20,000 × 5 × 0.5 = 50,000 SAR
• Next 7 years: 20,000 × 7 = 140,000 SAR
• Total: 190,000 SAR
• Ratio: Full benefit (10+ years service)
• Benefit due: 190,000 SAR

Legitimate Resignation Under Article 81

In certain cases, employees are entitled to full benefit even when resigning. These cases are listed in Article 81 of the Labor Law:

• Employer's breach of contractual obligations.
• Proven fraud or deception by employer at hiring.
• Physical harm to employee at work.
• Proven serious health hazard in workplace.
• Unpaid wages for 60+ days.

Tips Before Resigning

• Verify your exact years of service before making a decision.
• Use our EOS Benefit Calculator to calculate your entitlements.
• Submit advance notice as per your contract terms.
• Keep all documentation (contract, pay slips, termination correspondence).