Saudi Termination Pay: Missed Notice and No Valid Reason

Three payments can be due when a Saudi employment contract ends: notice pay, compensation for ending it without a valid reason, and the end of service award. This guide covers the first two, from Articles 75 to 78 of the Labor Law.

Notice for an indefinite-term contract (Article 75, amended 2025)

For a contract without a fixed end date, whoever ends it must give written notice and have a valid reason, stated in the notice.

	Monthly-paid worker	Not monthly-paid
Employer ends the contract	At least 60 days	At least 30 days
Employee ends the contract	At least 30 days	At least 30 days

If notice is not given (Article 76)

The party that ends the contract without notice must pay the other party compensation equal to the worker’s pay for the notice period. Our calculator charges pay for the notice days not given, which is the usual reading. The published text says “for the duration of the notice period”, so in a dispute someone could argue for the full period.

Example 1. Employer gives 45 of the 60 days. Wage SAR 9,000, daily wage 9,000 ÷ 30 = SAR 300. Missing 15 days × 300 = SAR 4,500 owed to the employee.

Example 2. The employee leaves after giving 10 of the 30 days. Missing 20 days × 300 = SAR 6,000 owed to the employer.

Dismissal without a valid reason (Article 77)

Unless the contract sets its own compensation, the party harmed by a termination without a valid reason is entitled to:

• Indefinite-term contract: 15 days’ wage for each year of the worker’s service.
• Fixed-term contract: the wage for the rest of the term.
• In both cases, never less than two months’ wage.

Example 3. Wage SAR 9,000, indefinite contract, 10 years: 15 days × 300 = 4,500 a year × 10 = SAR 45,000.

Example 4. Same wage, 3 years: 3 × 4,500 = 13,500, which is below two months’ wage (SAR 18,000), so the minimum applies: SAR 18,000.

If the reason is disputed, the labour court decides whether it is valid.

During the notice period (Article 78)

• If the employer gave notice, the worker gets a paid day, or eight hours, each week to look for other work. The worker chooses the time and must tell the employer at least a day ahead.
• The employer may excuse the worker from attending during the notice period, without affecting the worker’s service or entitlements for that period.

What is separate

• The end of service award is owed on top of these amounts, except in the Article 80 cases, where there is no award, notice or indemnity.
• The employer must settle wages and entitlements within one week of the contract ending, or two weeks if the worker ended it (Article 88).
• If you are the employee and want to leave, see resigning in Saudi Arabia.

Use the notice period and termination pay calculator for your own figures, or the final settlement calculator to add them to your award, leave and unpaid wages.

Source: Saudi Labor Law, Royal Decree No. M/51, English text published by the Ministry of Human Resources and Social Development, Articles 2, 75 to 78, 80 and 88, and the Ministry’s guideline “Amendments to Labor Law Articles” (6 August 2024) for the amended Article 75. Articles 76, 77 and 78 are not in the Ministry’s list of changed articles. Checked on 2 October 2026. The English text is a translation; the Arabic text governs.