End of service benefits is crucial for foreign employees in KSA. Like other developed countries, Saudi Arabia is one of the top attractive places for job seekers with a lot of benefits.
When a fresh graduate applies for a job, the applicant tries to get satisfied with the company’s policies.
Because in many cases, a fixed monthly salary can’t satisfy an employee. Benefits with fixed salary attract other job appliers.
Saudi government’s laws about expatriate workers are very beneficial and helpful. That’s why they love to get a job and live their lives in KSA because of the end of service benefits.
End of Service Benefits
What do you think when you leave your job after a certain time and have no extra money? If someone tells you that you are eligible to get fixed money from the company by Saudi law, what you will do?
So, now what is the end of service benefits?
According to the Saudi labor law’s article 84, a company will pay the employees after the resignation of an employee or expiration of the contract.
Apart from a tax-free salary, the ESB in the Saudi labor law is the best thing for expatriates who work in Saudi Arabia.
If we explain, the amount of end of service benefits is directly proportional to the number of years a worker spent in Saudi.
A company gives receives half a month’s pay for each year and one month’s pay for each subsequent year of service, if an employee serves for the first five years That money will be calculated from the last month’s wage an employee gets.
However, sales commissions or percentage doesn’t come in this allowance in the wage because this can’t be calculated accurately.
Major Points in ESB
- Before completing 2 years if you give resign from your job, the company will not pay you ESB.
- Because you are not eligible for this facility according to law.
- But if you have completed a 2-year term and giving resign, you will be eligible to get 1/3rd of end of service benefits. The percentage of salary will be half of the present salary.
- If your 5-year term has been completed. The company will give you 2/3rd of ESB if you are leaving your job. Here the percentage of salary will be the full salary of the employee.
- But if you have been completed one decade of your service, means 10 years, so you will be eligible to get full of end of service benefits, in case of your resign. The percentage of salary will be full salary here.
ESB for Contract Base Workers
If you are working on a contract base job in Saudi Arabia and don’t know much about the end of services benefits, don’t worry. I am here to help you.
- If your employer terminates you from your job before the completion of 5 years, he will give you your half salary according to your last month’s wage.
- If you get terminated after 5 years of services and you are on contract. So, you are eligible to get half your salary for the first five years and after that, your full salary will be calculated.
ESB for Female Workers
In the case of female employees, the Saudi government is very sensitive and makes women-friendly laws. End of service benefits for females are:
- If a female employee is married and resigns after 6 months of her marriage, so the company will give her full end of service benefits.
- In the case of childbirth, if the lady resigns after 3 months, so she will get the full end of service benefits.
How To Calculate End of Service Benefits
There is a calculator developed by the Ministry of Human Resources and Social Development of KSA.
You can go to their official website (Ministry of Human Resource and Social Development), and after putting in the required information, the calculated amount will be shown.
When that calculator will be opened, you will see different boxes with questions such as “Type of contract”.
You can choose one option such as “fixed time” or “unlimited period”.
In this step, you will enter the reason for the end of service. With that, you will also give some other information such as salary, duration of service(years), number of months (optional), and number of days (optional).
After that, press the button “=” and you will see the exact amount of end of service benefits.
I have worked for several years in Saudi Arabia as an expatriate. So I know how dificult it is to manage all the documents and formalities for a common worker in KSA. This is reason I started to write all these articles to help expats in KSA. I hope you enjoy my content.