Employee rights upon resignation in the new Saudi labor law 2026

The recent amendments have firmly established employee rights upon resignation in the new Saudi Labor Law with unprecedented clarity, achieving a qualitative leap in protecting both parties. Resignation is now subject to specific regulations that guarantee the employee receives all their entitlements, including end-of-service bonus, compensation for unused leave, and the regulation of the notice period and the mechanism for calculating compensation in case of breach of these regulations.

In this article, we review in detail the rights of the worker when making the decision to resign under the new system, and we provide a comprehensive guide that ensures you know your rights and obligations before signing the resignation form.

Abdulaziz bin Yasser Al-Anzi Law Firm 

What is resignation in the Labor Law?

Article 2 of the Saudi Labor Law defines resignation as an employee's written declaration of their desire, without coercion, to terminate their employment.Fixed-term employment contractWithout comment, condition, or stipulation, and with the employer's acceptance of it.

The Saudi legislator has given the worker the right to submit his resignation for any reason, or even without the need to mention a specific reason, as it is enough for the worker to have the desire to end his work.

It is worth noting that we differentiate between resignation and termination of the contract by mutual consent; resignation is when the worker terminates the employment contract on his own initiative, while termination of the contract by mutual consent is an agreement between the two parties - the worker and the employer - to terminate the contract without obligating either of them.

This difference is fundamental in determining the rights arising in each case, especially with regard to the end-of-service bonus, as the agreement to terminate the contract by mutual consent is not subject to the same restrictions imposed by Article (85) upon resignation.

Resignation procedures in the Labor Law

Resignation acceptance mechanism

The article stipulates that if a worker submits his resignation and the employer does not respond within 30 days, the resignation is considered automatically accepted. The employer has the right to postpone its acceptance for an additional period (up to a maximum of 60 days) if there is a reason related to the interest of the business, provided that he explains this in writing to the worker before the end of the first 30 days. The postponement period begins from the time the worker is notified of this explanation.

Contract termination mechanism by resignation

The employment contract ends with resignation from the date the employer accepts it, or from the date the thirty-day period has passed without a response, or from the date the postponement period mentioned above has ended.

Right to withdraw resignation

The legislator granted the worker the right to withdraw his resignation request within a period not exceeding seven days from the date of its submission, unless the employer accepts it before the withdrawal, with the aim of protecting the worker from hasty decisions and giving him a chance to reconsider.

Prohibition on setting a postponed date for resignation

The article stressed that a resignation request should not specify a postponed date for it, in order to prevent the resignation from being exploited as a future pressure tactic by either party.

The contract remains in effect during the resignation period.

The article stipulated that the employment contract is valid during the period of the resignation request, and both parties to the contract are obligated to fulfill all obligations arising from it during that period.

It is clear from the above that the employer has the right, in the event of the resignation of a worker on a fixed-term contract, to reject the resignation. Consequently, the worker is obligated to complete the contract period, pay compensation for termination, postpone for a maximum of sixty days, or not respond, and the contract is terminated after thirty days.

Regarding the resignation of an employee during the probationary period, he has the right to do so provided that the contract explicitly stipulates this period and that it does not exceed 90 days. The contract must also include a clause authorizing both parties to terminate it during this period, and the contract must be valid at the time of termination. The employee is not entitled to any compensation for this period unless the contract stipulates otherwise.

Employee's entitlements after resignation

An employee whose contract has ended due to resignation is entitled to all his rights stipulated under the system, except for what relates to the end-of-service gratuity, which is subject to a special calculation in accordance with Article (85) of the system:

End-of-service gratuity upon resignation

The end-of-service gratuity is among the employee's entitlements after resignation, and it is progressively linked to the length of service. An employee whose service has not completed two years is not entitled to any gratuity. If it reaches two years and continues until five years, he is entitled to one-third of the gratuity. If it exceeds five and reaches ten years, the percentage increases to two-thirds. Only he who has spent ten years or more in the service of the employer receives the full gratuity.

The calculation mechanism is based on the worker's last monthly salary, with half a month's salary awarded for each of the first five years, a full month's salary for each of the next five years, and a month and a half's salary for each year after the tenth year.

Exceptional cases where the full reward is deserved

There are important exceptions that grant the employee the full bonus regardless of length of service, including:

1. casesForce majeureWhich prevents the worker from continuing to work.
2. The working woman resigns within six months of the date of her marriage.
3. The working woman resigns within three months of the date of her delivery.
4. Cases in which it is proven that the employer has breached his essential contractual or regulatory obligations in a manner that justifies termination of the contract.

In lieu of unused annual leave

The worker is entitled to cash payment for his unused annual leave balance upon termination of the employment relationship, whether by resignation, dismissal or expiry of the contract term.

This allowance is calculated based on the actual wage, which includes the basic salary, housing allowance, transportation allowance, regular commissions, and fixed periodic bonuses. It should be noted that the system prohibits receiving cash compensation for leave while the employment relationship is ongoing.

Wage due for actual working days

The worker is entitled to his full wages for the days he worked up to the date of termination of the employment relationship, in addition to any outstanding salaries or financial entitlements that were not paid to him before resignation.

He is also entitled to financial compensation for overtime hours worked during his employment, provided that this is documented according to the procedures adopted by the establishment or through official records.

Certificate of Experience

Among the employee's entitlements after resignation is a certificate of experience that clarifies the date of joining the job, the date of termination of service, job title, type of work performed, and salary received.

The employer must not include in this certificate any statements that may harm the worker’s reputation or reduce his chances of obtaining a new job. The employer is also obligated to hand this certificate over to the worker free of charge upon termination of the employment relationship.

Cases of contract termination without notice

The Saudi labor law permits an employee to leave work without prior notice in several specific cases, which are:

1. If the employer grossly breaches his essential contractual and regulatory obligations.
2. If it is proven that the employer or his representative has committed fraud or misrepresentation at the time of contracting with regard to the terms and conditions of employment.
3. If an attack is committed against the worker or one of his family members by the employer or his representative.
4. If the worker’s continued employment threatens his safety or health, provided that the employer is aware of this and has not taken the necessary measures to remove the danger.

Post-resignation procedures

After submitting his resignation, the employee must observe the following procedures to ensure his rights:

Work will continue during the notice period.

The worker must continue to perform his job duties during the thirty-day period or the agreed-upon period, as the contract remains valid and the obligations remain in place during this period.

Handing over the covenant and possessions

The worker shall officially and documentably hand over all assets and property belonging to the employer before the end of the notice period, and shall obtain a receipt proving his clearance.

Settlement of dues

The employer is obligated to settle all the employee’s financial entitlements, including end-of-service bonus and allowance for unused vacations, within a maximum period of 60 days from the date of termination of the contractual relationship.

If the employer delays payment after this period, the worker is entitled to compensation for the delay, and he can resort to the “Qiwa” platform or file a lawsuit before the Labor Court to claim his rights.

Documenting the financial settlement

After receiving all his dues, the worker should sign a final financial settlement and keep a certified copy of it to guarantee his rights in case any subsequent dues arise.

Conditions for resigning from work

The most prominent conditions for resigning from work in the new Saudi system are as follows:

1. The resignation must be written and issued of free will without coercion.
2. It must not be subject to any condition or stipulation, and it must not include a deferred date.
3. The worker has the right to withdraw his resignation within 7 days of submitting it, unless the employer accepts it before that.
4. A resignation is considered accepted if 30 days have passed without a response from the employer.
5. The contract remains in effect, and both parties are bound by all their obligations during the period of the resignation request.
6. An employee has the right to leave work without notice in specific cases, such as the employer's breach of essential obligations, fraud, or exposure to serious danger at work.
7. The worker is entitled to an end-of-service bonus according to his length of service, along with all his other rights, within a maximum period of 60 days.
8. If the worker resigns during the trial period, he has the right to terminate the contract without notice or compensation, provided that the trial period is stipulated in the contract and that the period does not exceed 180 days.

In conclusion, the new Saudi Labor Law of 2026 has given considerable attention to regulating resignation provisions in order to achieve a balance between the rights of the worker and the interests of the employer. The worker has the right to terminate the contractual relationship unilaterally without arbitrariness, while guaranteeing their full legal rights, including end-of-service benefits, compensation for unused leave, and other entitlements. At the same time, it has established controls to protect the stability of establishments by regulating notice periods and mechanisms for acceptance and postponement.

Therefore, we recommend that every employee considering resignation be fully aware of the regulations and not hesitate to consult [the relevant authorities/organizations/etc.].Abdulaziz bin Yasser Al-Anzi Law FirmRegarding resignation issues in the Saudi Labor Law when needed, to ensure that he receives his full and undiminished rights.

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