Most workers assume their end-of-service benefit grows in a straight line: twice the years, twice the money. In Saudi Arabia it does not. The award climbs far faster once you pass the five-year mark, because the accrual rate itself changes. Comparing end of service after 5 years with end of service after 10 years is the clearest way to see this, and the gap surprises almost everyone who runs the numbers for the first time.
Under Articles 84 and 85 of the Saudi Labour Law, enforced by HRSD and Qiwa, the benefit is not a flat percentage of tenure. It is a two-tier formula that rewards longer service with a materially higher rate. That single design choice is why Saudi end of service after 10 years is worth roughly three times the five-year figure, not double. This guide explains the step-up, shows the math per milestone, and clarifies how resignation changes the picture.
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The half-month vs full-month rule
The whole comparison of 5 vs 10 years rests on one rule. For the first five years of service, you accrue half a month's wage for each year worked. From the start of year six onward, you accrue a full month's wage for each additional year. The half month vs full month distinction is the crux of everything: the rate literally doubles the moment you cross five years of continuous service.
The award is calculated on your agreed wage, which in most contracts means the basic salary rather than total pay including allowances. Partial years are counted pro-rata, so an employee who leaves after eight years and four months earns the full-month rate for the three years and four months that sit beyond the five-year threshold. For a full breakdown of the mechanics, see our guide to end of service calculation in Saudi Arabia.
Because the first five years are permanently locked at the half-month rate, they never "upgrade" once you pass year five. Instead, every year after five is simply added on top at the higher rate. This is why the benefit accelerates rather than growing evenly, and why a decade of service is far more valuable per year than the first half of it.
A note on tax
There is no personal income tax in Saudi Arabia, so the end-of-service award is paid in full without deduction. The gross figure you calculate is the amount you actually receive, which makes these milestones easy to compare directly.
| Years of service | How it accrues | Award (SAR) |
|---|---|---|
| 1 year | 1 × ½ month | 5,000 |
| 3 years | 3 × ½ month | 15,000 |
| 5 years | 5 × ½ month | 25,000 |
| 6 years | 25,000 + 1 × 1 month | 35,000 |
| 8 years | 25,000 + 3 × 1 month | 55,000 |
| 10 years | 25,000 + 5 × 1 month | 75,000 |
| 15 years | 25,000 + 10 × 1 month | 125,000 |
Notice the shape of the numbers. Doubling tenure from five to ten years triples the payout, from SAR 25,000 to SAR 75,000. From that point the award grows by a clean SAR 10,000 for every extra year, because each year now earns a full month at the SAR 10,000 basic wage.
How much is end of service after 10 years
The most common question is simply how much end of service after 10 years comes to. The answer splits into two clean parts. Take an employee terminated after exactly ten years on a basic wage of SAR 10,000 a month.
First five years — accrued at half a month each: 5 × (½ × 10,000) = 5 × 5,000 = SAR 25,000. Years six through ten — accrued at a full month each: 5 × (1 × 10,000) = 5 × 10,000 = SAR 50,000. Add the two tiers together and the total is SAR 75,000.
Set that against the five-year figure of SAR 25,000 and the point becomes obvious. Ten years is not double five years; it is three times as much. The extra five years alone contribute SAR 50,000, which is twice what the entire first half of the decade produced. If you stay a further five years to reach fifteen, you add another SAR 50,000 for a total of SAR 125,000, and the linear growth beyond year five continues at SAR 10,000 per year on this wage.
The lesson for anyone weighing a job change is that the years immediately after five are the most valuable you will ever accrue. Leaving at four years and eleven months versus five years and one month makes a meaningful difference, and the difference only widens as you approach the ten-year mark.
How resignation changes each milestone
Everything above assumes the contract ended by the employer's action, such as termination or non-renewal. When you resign, the law applies a sliding scale based on your total length of service. You first calculate the full award using the half-month and full-month tiers, then apply the resignation fraction that matches your tenure.
| Total service | Share of full award | Example on SAR 10,000 basic |
|---|---|---|
| Under 2 years | Nothing | SAR 0 |
| 2 to 5 years | One third (⅓) | 5-year full award 25,000 → 8,333 |
| 5 to 10 years | Two thirds (⅔) | Award scaled to two thirds |
| 10 years or more | Full award | Same as termination |
The resignation scale is where reaching ten years pays off a second time. An employee who resigns at exactly ten years receives the full award of SAR 75,000, identical to a terminated colleague. Resign a day earlier, in the 5-to-10-year band, and only two thirds is payable, roughly SAR 50,000 on the same wage. Crossing the decade therefore delivers both the higher accrual rate and the removal of the resignation discount at once.
This is why the way a contract ends matters as much as its length. The full mechanics of who owes what, and when, are covered in our guide to resignation vs termination and end of service in Saudi Arabia. Before you hand in notice, it is worth checking exactly which band you fall into, since a few weeks can move you into a higher fraction. When you are ready to see your own figure, our Saudi end-of-service calculator applies both the tier step-up and the resignation scale automatically.