Saudi Arabia or the UAE? Comparing End-of-Service Benefits
The two biggest Gulf systems for expatriate employment — but the details that matter differ. This comparison uses the official texts only.
The formula
Saudi Arabia
half a month for each year during the first 5 years of service; a full month for each year after that
United Arab Emirates
21 days for each year during the first 5 years of service; a full month for each year after that
Wage base
Saudi Arabia
The award is calculated on the LAST WAGE — in MHRSD/HRSD practice this is the basic salary plus regular allowances. Variable components (commissions, sales percentages) may be excluded ONLY if the contract validly says so (Article 86).
United Arab Emirates
Gratuity is calculated on the BASIC SALARY ONLY — housing, transport and other allowances are excluded (Article 51). The law uses "days of basic wage"; the standard divisor is 30 (daily wage = monthly basic ÷ 30).
Resignation
Saudi Arabia
- from 2 to 5 years: one-third of the award
- from 5 to 10 years: two-thirds of the award
- 10 years or more: the full award
United Arab Emirates
The law does not distinguish between resignation and termination when calculating the award — the result is the same either way.
Cap
Saudi Arabia
no statutory cap on the total award
United Arab Emirates
statutory cap: 24 months of wages
Payment deadline
Saudi Arabia
The employer must pay wages and settle all entitlements within one week of the end of the contractual relation — two weeks if the worker ended the contract (Article 88).
United Arab Emirates
All end-of-service entitlements must be paid within 14 days of the contract’s termination (Article 53). Scope: private-sector mainland; DIFC/ADGM and domestic workers follow separate regimes.
Notice and annual leave
Saudi Arabia
- Notice (Indefinite-term contracts (2024 amendments, effective Feb 2025)): employee 30 days / employer 60 days.
- Annual leave: 21 days — Per year of service; 30 days after five consecutive years with the same employer (Art 109).
United Arab Emirates
- Notice (Either party, 30–90 days as agreed in the contract (Art 43)): employee 30 days / employer 30 days.
- Annual leave: 30 days — After 1 year of service; 2 days per month for service between 6 months and 1 year (Art 29).
The bottom line
There is no universally "better" country — Saudi Arabia pays higher rates to those who complete ten years and resign, while the UAE is simpler (no resignation reduction at all) but has a clear cap. Run your own case in the calculator for the country where you work; individual differences outweigh any generalisation.
Guides for both countries
Calculators for both countries
Compare all six Gulf states