Quick answer: yes. The end-of-service benefit is calculated on your last actual wage, and under Article 2 of the Saudi Labor Law the actual wage is the basic wage plus all regular, recurring allowances — housing and transport allowances included. An employer who calculates your EOSB on basic salary alone is underpaying it.
What “wage” means in the Labor Law
Article 2 distinguishes two terms:
| Term | What it covers |
|---|---|
| Basic wage | The core salary in your contract, excluding allowances |
| Actual wage | Basic wage plus everything paid to you regularly for your work: housing allowance, transport allowance and other fixed recurring payments |
The end-of-service award articles use the worker’s last wage, meaning the actual wage. That is also the basis our calculator uses — enter basic plus your regular allowances, not basic alone.
What counts, what usually doesn’t
Counts (regular and recurring):
- housing allowance paid in cash each month;
- transport allowance;
- fixed, contractual allowances paid every month (nature-of-work allowance and similar);
- regular commissions or percentages that form part of how you are paid.
Usually doesn’t count:
- genuine one-off payments: an exceptional bonus, a one-time reward, reimbursed expenses;
- benefits with no cash value to you each month, where the contract treats them as a facility rather than pay.
Grey areas exist — for example housing provided in kind, or bonuses paid every year — and contracts word these differently. Your contract and your registered wage on Qiwa are what settle the number; when the amounts are large, a labor lawyer’s reading of your contract is worth it.
How much difference it makes
Take seven years of service ending with termination by the employer (full benefit), basic salary 8,000 SAR, housing 2,000 SAR, transport 500 SAR:
| Basis | Wage used | First 5 years (half month each) | Years 6–7 (full month each) | Benefit |
|---|---|---|---|---|
| Basic only (wrong) | 8,000 | 20,000 | 16,000 | 36,000 SAR |
| Actual wage (correct) | 10,500 | 26,250 | 21,000 | 47,250 SAR |
Using the correct wage adds 11,250 SAR in this example — nearly a third more. The same applies to the leave-day payout in your settlement, which is the daily wage (monthly wage ÷ 30) for each unused day.
Practical steps
- Add up basic + regular monthly allowances from your contract and payslips.
- Compare it with the wage registered on Qiwa; raise mismatches with HR early, not at exit.
- Enter the actual wage in the calculator to see your estimate, and read the step-by-step breakdown.
- If your employer’s settlement uses a lower wage, ask them to show the basis — the law, not habit, decides.
The exact rules we apply, checked against 20 worked examples, are on the How we calculate page.