End-of-service benefit calculator
Computed according to the Saudi Labor Law (Article 84), with the same seventeen reasons for ending the contract as the Qiwa calculator of the Ministry of Human Resources and Social Development, and every step of the calculation shown. For one employee, or for a whole workforce from an Excel file.
Half a month's wage for each of the first five years, and a full month's wage for each following year, on the last wage, pro-rated for fractions of a year.
Article 85 (resignation)Under 2 years: none · 2 to 5 years: one third · over 5 and under 10: two thirds · 10 years or more: full.
Article 77 (termination without a legitimate reason)Full award, plus a separate compensation: 15 days' wage per year of service for an indefinite contract, or the wage of the remaining term for a fixed-term contract, with a minimum of two months' wage.
Article 80 (termination for cause)No award, notice or compensation when the employer proves one of the Article 80 cases, such as assault, serious misconduct, breach of essential duties or absence without a legitimate reason.
Calculator
This employer tool adds up the statutory end-of-service award of each employee under the Saudi Labor Law as at the date you choose. It is provided for guidance and planning only. It is not an accounting measurement and must not be used for accounting entries. The provision in the financial statements has to be measured under IAS 19 Employee Benefits (or Section 28 of IFRS for SMEs), with a discount rate, salary growth, attrition and mortality assumptions, and not on the labour-office formula.
How an IAS 19 valuation differs →- Download the templateOne row per employee, with 350 rows prepared (add more if needed): contract type, dates, total salary and how the service ends.
- Tell us who is using itCompany, contact person, phone, email and an optional headcount. We do not receive your employee file.
- Upload and read the resultsPer-employee awards and the statutory total, computed in your browser, downloadable as Excel.
Upload the completed template
Only the ECT Excel template is accepted. Download it from this page, fill in the Employees sheet and upload it without renaming the sheet or the column headings. Other payroll or HR files are not read.
The file is processed in your browser only. Nothing is uploaded.
What the calculator applies, step by step
1 · Service period
From the start date to the last day of service inclusive, in years, months and days. Fractions of a year are pro-rated: months over twelve and days over 365.
2 · Full award, Article 84
The first five years earn half a month's wage per year; every year after the fifth earns a full month. The wage is the last total monthly salary: basic salary plus housing and other fixed allowances.
3 · Entitlement by ending
The seventeen endings are the ones listed on the Qiwa calculator. Most carry the full award; resignation follows the Article 85 thirds; termination during probation (Article 53) and termination under Article 80 carry no award.
The contract type is asked first, as on Qiwa: expiry of the term is available for fixed-term contracts only, and it sets the basis of the separate Article 77 compensation. The seventeen endings are the ones listed on the Qiwa calculator. Expiry of the term, agreement of both parties, retirement, closure of the establishment or its activity, incapacity, death, work injury, transfer of a sole proprietorship where the worker does not consent to the transfer of his rights (Article 18), the Article 87 cases for a female employee, termination without a legitimate reason (Article 77) and termination by the employee under Article 81 all carry the full award. Resignation follows the Article 85 thirds: nothing below two years, one third from two to five years, two thirds above five and under ten, and the full award from ten years. Termination during the probation period (Article 53) and termination by the employer under Article 80 carry no award.
The number the labour office gives is not the number the auditor needs
The statutory award answers one question: what is owed if service ends today. IAS 19 asks a different one: what is the present value of the benefit employees have earned, allowing for the salaries they will have when they actually leave, the likelihood of their leaving in each future year, and the time value of money until then. That measurement needs a discount rate taken from high-quality corporate or government bond yields, a salary growth assumption, withdrawal and mortality tables, and an attribution of the benefit to periods of service. The two figures are routinely different, and the movement in the IAS 19 figure each year is split between profit or loss and other comprehensive income.
IAS 19 valuation serviceFrequently asked
How is the end-of-service award calculated under the Saudi Labor Law?
Article 84 grants 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, based on the last wage, with fractions of a year pro-rated. Article 85 reduces the award when the employee resigns: nothing before two years, one third from two to five years, two thirds above five and below ten years, and the full award from ten years.
Which salary is used?
The last total monthly salary: basic salary plus housing and other fixed allowances paid regularly. The Labor Law's actual wage (Article 2) also takes in variable pay such as commissions and percentages of sales, unless the contract excludes it from the end-of-service wage as Article 86 allows; where it is included, add its monthly average to the salary you enter.
Does an employee who resigns during a fixed-term contract get anything?
It depends on length of service. Resignation is one entry on the Qiwa list whatever the contract type, and the Article 85 thirds apply: nothing under two years, one third from two to five years, two thirds above five and under ten, and the full award from ten years. A fixed-term contract that simply expires carries the full award. An employee who leaves a fixed-term contract early without a legitimate reason can also be liable to the employer for compensation under Article 77.
Is this the amount a company should record as a provision?
No. The statutory figure is what each employee would receive if service ended today. The accounting provision under IAS 19 is an actuarial measurement that projects future salaries, discounts expected payments to present value and allows for attrition and mortality. It is routinely different from the statutory total, in either direction. Use this tool for indicative planning and an IAS 19 valuation for the financial statements.
Where does my employee data go when I use the employer tool?
Nowhere, unless you choose to send it. The Excel file is read and computed inside your browser and is not uploaded to our servers. Only the access details you enter in the short form (company, contact person, phone, email and, if you give it, the number of employees) are sent to us. A copy of the results reaches our actuary only if you use “Send these results to our actuary”, and you can leave names out.
This calculator reflects the Saudi Labor Law as amended and is provided for information. It does not constitute legal, accounting or actuarial advice, and individual contracts, collective arrangements or court rulings may lead to a different outcome.