Termination of Contract under Saudi Labour Law
Termination of an employment contract in Saudi Arabia is governed by Saudi Labour Law to protect both employees
and employers. Understanding when and how a contract may be legally terminated is essential for employees,
especially expatriates, to safeguard their rights and financial entitlements.
- Cases of contract termination
- Employee leaving without notice
- Termination without EOSB
- Employee rights upon termination
- Legal protection and dispute resolution
Related Labour Law Guides
1. What is Termination of Contract?
Termination of contract refers to the legal ending of an employment relationship between an employer and an employee.
Termination can occur due to several reasons, such as:
- Completion of a fixed-term contract
- Mutual agreement between employer and employee
- Resignation by the employee
- Termination by the employer
- Circumstances defined under Saudi Labour Law
2. Cases in Which the Employment Contract Shall Be Terminated
✔ Expiry of Contract Term
- A fixed-term contract ends automatically upon reaching its agreed end date unless renewed.
✔ Mutual Agreement
- Both employer and employee may agree in writing to terminate the contract.
✔ Employee Reaching Retirement Age
- The contract may end when the employee reaches the legal retirement age, unless both parties agree to continue.
✔ Force Majeure
- Termination due to circumstances beyond control that make continuation impossible.
3. Termination by Employer
- Termination with notice (normal termination)
- Termination without notice under Article 80
- Unlawful termination compensation
4. Termination by Employee (Resignation)
- Notice period compliance
- Contract type impact (fixed or unlimited)
- EOSB entitlement after resignation
5. Termination Without EOSB
- Serious misconduct
- Breach of contract obligations
- Fraud or dishonesty
- Repeated violations
6. Employee Rights Upon Termination
- Final salary settlement
- EOSB payment (if eligible)
- Unused leave compensation
- Experience certificate
- Transfer of services (if applicable)
7. Legal Protection & Dispute Resolution
- HRSD complaint system
- Amicable settlement committees
- Labour court proceedings
- Judicial enforcement
Need Legal Help for Termination?
If you are facing wrongful termination, EOSB denial, salary issues, or contract disputes, get professional legal support.
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