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Sunday, January 24, 2016

SAUDI LABOR LAW: ABOUT END OF SERVICE AWARD OR END OF SERVICE BENEFITS






Upon the end of the work relation, the employer shall pay the employee an end-of-service award of a half-month wage for each of the first five years and a one-month wage for each of the following years. 
The end-of-service award shall be calculated on the basis of the last wage and the employee shall be entitled to an end-of-service award for the portions of the year in proportion to the time spent on the job.

a) If the work relation ends due to the employee's resignation and his service was less than two years, the employee shall not be entitled to the end of service award.

b) If the work relation ends due to the employee's resignation and his service was two years and up to 5 years, the employee shall be entitled to one-third of the end of service award.

c) If the work relation ends due to the employee's resignation and his service was more than five years but less than 10 years, the employee shall be entitled to two-thirds of the end of service award.

d) If the work relation ends due to the employee's resignation and his service was 10 years or more, the employee shall be entitled to the full end of service award.

e) If the work relation ends of a female employee within (6) months of her marriage the employee will be entitled to an end of service award equal to the wage of half a month for each year of the first five years and the wage of a month for each year thereafter.



f) If the work relation ends due to force majeure, the employee shall be entitled to an end of service award equal to the wage of half a month for each year of the first five years and the wage of a month for each year thereafter.
g) The employer and employee may agree that the wage used as a basis for calculating the end of service award does not include all or some of the commissions, sales percentages, and similar wage components paid to the employee which are by their nature subject to increase or decrease.

The end of service benefits of employee's rights on the employer in the case of termination of the employment contract, and it is obligatory on the employer to pay the employee at the end of the contract of employment, whether it is a fixed-term contract or indefinite. That's the easy way to estimate end of service benefits expense, the maturity date of the reward, and how to calculate it according to the rules of the Labor Law.
The end of service benefits of worker’s rights on the employer in the case of termination of the employment contract, and it is obligatory on the employer to pay the worker at the end of the contract of employment, whether it is a fixed-term contract or indefinite. That’s the easy way to estimate end of service benefits expense, the maturity date of the reward, and how to calculate it according to the rules of the Saudi Labor Law

CLICK HERE TO CALCULATE
source: Saudi Arabia Labor Education