In Saudi Arabia, employees must have end of service benefits. These end of service benefits in Saudi Arabia (ESI KSA) are obligatory and companies must provide them to keep their compliance with the Saudi labor law end of service. Therefore, to know if they are being well remunerated, most workers use an end of service calculator KSA or end of service calculator Riyadh for their gratuity calculation in KSA.
In this article, we will be talking about ESI KSA or end of service benefits in Saudi Arabia. Let us observe:
-End of service and ESB calculator
-Who deserves the ESB?
-What does the ESB includes?
-End of service benefits payment
-Connect Legal, your best partner in the UAE
Every KSA employee is eligible for End of Service Benefits at the ending of his or her service term. Here, you can see two End of Service Benefit (ESB) calculators for you. In addition, we also discuss the ESI KSA computation in full in accordance with Saudi Labor Law.
With this calculator, people can easily see their end of service benefit. All they have to do is:
-Dates of employment start and end.
-The number of days you have chosen to take unpaid leave.
-Total gross salary.
-Reason for termination/resignation.
This EOS calculator is from the Ministry of Labour of Saudi Arabia (https://laboreducation.mlsd.gov.sa/en/calc). Therefore, to use it, you must provide:
-Type of contract.
-Reason for resignation or termination.
-Time of the service.
Every worker operating in the Kingdom of Saudi Arabia needs to obtain their ESI KSA benefits, except:
-Employees operating under a business visit permit.
-Workers operating under a consultancy contract.
-Employees operating without transferring the sponsorship.
The calculation of the gratuity depends on whether the employee was fired or resigned. According to Saudi Labor Law article 84, in the event of termination, an employee is eligible for the following end-of-service benefits:
-Half of the first five years’ compensation for each year of service.
-After the first five years, full pay for each year of service.
-Remember that if an employee is dismissed in accordance with Saudi Labor Law Article 80, there is no ESB elegible.
A worker who had been with the company for 7 years was fired. His previous monthly pay was SR 10,000. The ESB calculator mentioned above is used to generate the screenshot that follows.
-Five Years X 10,000 / 2 = 25,000 is the ESB for the first five years.
-Next period’s ESB is equal to 2 Years x 10,000, or 20,000.
-Total = 45,000 SR.
The computation of the ESI KSA benefits in the event of resignation is affected by seven main scenarios.
Article 85 of the Saudi Labor Law states that an employee is not eligible for any end-of-service incentives if he leaves his job within two years of his resignation without finishing his contract.
Article 85 of the Saudi Labor Law states that if an employee leaves their position after two years but before accumulating five years of service:
-They have a right to one-third of his ESB reward.
-Half of the annual income is the ESB Award.
After 4 years of employment, an employee left the organization. His previous monthly pay was SR 10,000. The snapshot that follows was taken from the aforementioned calculator for End of Service Benefits.
ESB for the first four years is as follows: SR 6,667 = (10,000/2) X 4 X 1/3.