Saudi Labor Law: Resignation Rules, Notice Period, and Article 84 & 85 Guide

Saudi Labor Law End of Service Benefits (EOSB) & Resignation Framework

Understanding your rights and obligations under the Saudi Labor Law (Royal Decree No. M/51) is essential when resigning, changing employers via the Qiwa platform, or concluding your contract in the Kingdom of Saudi Arabia. The Ministry of Human Resources and Social Development (MHRSD) strictly regulates contractual terminations and severance pay through Articles 84, 85, 87, and 88.

Article 84: Standard EOSB Calculation Formula

Under Article 84 of Saudi Labor Law, upon end of contract or employer termination without cause:

• First 5 Years of Service: Half a month's actual salary for each completed year.
• Years Beyond 5 Years: One full month's actual salary for each subsequent year.
• Fractional years of service are calculated on a pro-rata basis.

Article 85: Resignation Payout Reductions

If an employee resigns from an indefinite or open-ended contract, the Article 84 award is scaled according to total tenure:

Notice Period Rules under Saudi Labor Law (Article 75)

For unlimited employment contracts, the party terminating must provide written notice:

• Monthly Salaried Workers: Minimum 60 days written notice prior to termination date.
• Non-Monthly Workers: Minimum 30 days written notice.
• If notice period is not observed, the terminating party must pay compensation equivalent to the employee's wage for the entire notice duration (Article 76).