#article77

The termination of an employment contract without a lawful reason can have financial consequences under Article 77 of the Saudi Labor Law.

However, compensation is not necessarily determined by one universal formula.

The type of contract, employee salary, length of service, remaining contractual period, contractual terms, and the circumstances surrounding termination may all be relevant when assessing the consequences of termination.

For fixed-term contracts, the remaining period can be particularly significant. For indefinite-term contracts, the employee’s wage and length of service may play an important role.

It is also essential to understand the difference between Article 77 and Article 80, as they concern different legal circumstances.

Read the complete guide to Saudi Labor Law Article 77 for a detailed explanation of compensation, termination rules, employee rights, and employer considerations.