End of Service Benefit FAQ

EOS Benefit is calculated based on the employee's last basic salary. For the first five years of service: half a monthly salary for each year. For years beyond five: a full monthly salary for each year. In case of resignation, the benefit is fractioned according to years of service as stipulated in Article 85 of the Labor Law. You can use our EOS Benefit Calculator for an instant estimate.

An employee is entitled to full benefit in several cases: (1) Contract termination by the employer without legitimate cause. (2) Expiry of a fixed-term contract. (3) Resignation after completing 10 years of service. (4) Reaching statutory retirement age. (5) Employee death (paid to heirs). (6) Resignation for reasons stated in Article 81 of the Labor Law such as employer breach of obligations or the employee being subjected to fraud or misrepresentation.

Under Saudi Labor Law, EOS Benefit is calculated on the basis of the basic salary only, which is the fixed wage the employee receives for their work. Allowances such as housing, transportation, communication, and assignment allowances are not included in the calculation unless the company's internal regulations consider them part of the basic salary. In some judicial rulings, fixed allowances paid regularly and consistently such as housing allowance may be included in the calculation.

Article 85 of the Saudi Labor Law specifies the ratios as follows: (1) If service is less than 2 years, no benefit is due. (2) If service is from 2 to less than 5 years, one-third (1/3) of the benefit. (3) If service is from 5 to less than 10 years, two-thirds (2/3) of the benefit. (4) If service is 10 years or more, the full benefit.

According to Article 85 of the Labor Law, if an employee voluntarily resigns before completing 2 years of continuous service, they are not entitled to any EOS Benefit. However, if the contract is terminated by the employer during this period, the employee may be entitled to the benefit. Also, resignation for legitimate reasons under Article 81 may grant the employee full entitlement even if the service period is less than 2 years.

An employee is not entitled to EOS Benefit in the following cases: (1) Voluntary resignation before completing 2 years of service. (2) Disciplinary dismissal under Article 80 of the Labor Law, including: assault on the employer, forgery to prove experience, disclosure of industrial secrets, repeated failure to perform essential obligations, proven intoxication or drug use during work. (3) Leaving work without prior notice. (4) Contract termination during the probation period.

Yes, an employee is entitled to full EOS Benefit upon reaching the statutory retirement age of 60 for both men and women in the private sector. The benefit is calculated based on the last basic salary and total years of service without any fraction, regardless of the length of service. The only exception is if the employee resigned before reaching retirement age, in which case regular resignation rules apply.

The employer must pay EOS Benefit within the following periods: (1) If the contract is terminated by the employer, payment must be made within one week from the contract end date. (2) If the employee resigns, payment must be made within 10 days from the resignation date. (3) In case of employee death, entitlements must be paid to heirs within one week of their application. Late payment subjects the employer to fines and penalties under the law.

According to Article 84 of the Saudi Labor Law, EOS Benefit is calculated on the basis of the last wage the employee was receiving. In practice, the basic salary is the one used for calculation. Total salary includes the basic salary plus monetary and in-kind allowances and benefits. In some cases where allowances are fixed and regular, labor courts may consider certain fixed allowances as part of the wage. We recommend consulting a legal specialist for your specific case.

Upon the death of an employee, their heirs are entitled to the full EOS Benefit under Article 86 of the Labor Law. The benefit is paid to the legal heirs based on the certificate of inheritance issued by the competent court. The employer must pay the benefit within 7 days from the date the required documents are submitted. The benefit is distributed among heirs according to their Shariah inheritance shares.

The calculation method for EOS Benefit is the same for both fixed-term and unlimited-term contracts. Both use the same formula: half salary per year for the first 5 years, then full salary per year after that. The key difference lies in termination scenarios: in a fixed-term contract, if the term expires and is not renewed, the employee receives full benefit. In an unlimited-term contract, resignation and termination rules with notice periods apply.

To verify your EOS Benefit calculation, follow these steps: (1) Use our EOS Benefit Calculator for an initial estimate. (2) Review Articles 84-89 of the Saudi Labor Law published on the Ministry of Human Resources and Social Development website. (3) Compare with former colleagues in similar circumstances. (4) Consult a lawyer specializing in labor cases. (5) Contact the Ministry of Human Resources and Social Development through its official channels for inquiries.

Yes, an employee wishing to resign must provide prior notice to the employer as specified in the contract or internal regulations. Article 74 of the Labor Law stipulates that the notice period must be no less than 30 days and no more than 60 days for monthly salaried employees. Leaving work without notice may result in forfeiture of the benefit or part of it, and may obligate the employee to pay compensation to the employer.

Under Article 87 of the Labor Law, an employer may not deduct any amount from the EOS Benefit except in limited cases: (1) If the employee owes the employer money under a court judgment. (2) If the employee caused material losses proven by a competent authority. (3) Within what is stipulated by the law or internal regulations provided they do not conflict with the law. The employer may not withhold the benefit or link it to signing unfair settlements.

If your employer refuses to pay the EOS Benefit, you have several legal options: (1) File a complaint with the Ministry of Human Resources and Social Development through its website or Qiwa app. (2) Visit the labor office in your area to register the complaint. (3) File a case with the Primary Committee for Settlement of Labor Disputes. (4) Hire a specialized lawyer. Keep all supporting documents including the employment contract, salary slips, termination correspondence, and experience certificate.

During the probation period as defined in Article 53 of the Labor Law, an employee is not entitled to EOS Benefit if the contract is terminated by either party. The probation period allows both employer and employee to evaluate the working relationship without EOS obligations. However, once the probation period ends and the employee continues working, the service period starts counting for EOS purposes from the original start date.