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Saudi End of Service Formula:
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The Saudi End of Service Calculator estimates gratuity benefits for employees in Saudi Arabia based on their last salary and years of service. It calculates end-of-service benefits according to Saudi labor law provisions.
The calculator uses the Saudi end of service formula:
Where:
Explanation: The calculation converts monthly salary to daily rate, then multiplies by 21 days per year of service. For service less than 5 years, the gratuity is half of the calculated amount.
Details: Accurate end-of-service calculation is crucial for both employers and employees to ensure compliance with Saudi labor laws and proper financial planning for employment termination.
Tips: Enter last monthly salary in SAR and years of service. All values must be valid (salary > 0, years between 0.1-50).
Q1: What is the difference between less than 5 years and 5+ years service?
A: For service less than 5 years, gratuity is half the calculated amount. For 5 years or more, full gratuity is paid.
Q2: What components are included in "last salary"?
A: Last salary typically includes basic salary and regular allowances, but excludes bonuses, overtime, and other variable payments.
Q3: Are there any exceptions to this calculation?
A: Yes, certain cases like termination for gross misconduct or resignation during probation period may affect gratuity entitlement.
Q4: How are partial years calculated?
A: Partial years are calculated proportionally. For example, 3.5 years would be calculated as 3.5 years in the formula.
Q5: Is this calculation applicable to all employees in Saudi Arabia?
A: This follows standard Saudi labor law provisions, but specific employment contracts or company policies may have variations.