The Legal Framework: Saudi Labor Law Governing Contract Termination
In Saudi Arabia, all employment relationships are governed by the Saudi Labor Law (promulgated under Royal Decree No. M/51 and its subsequent ministerial amendments). With the mandatory nationwide implementation of the Contract Authentication Program (برنامج توثيق العقود) on the Qiwa platform, verbal contracts or handwritten paper agreements are no longer legally recognized by the Labor Courts (المحاكم العمالية) for administrative execution.
Every lawful termination on Qiwa must align with one of the statutory articles stipulated in Chapter 5 of the Labor Law:
1. Article 74: Permissible Statutory Grounds
Under Article 74, an employment contract terminates legally only under specific circumstances:
2. Article 75: Statutory Notice Period Requirements
For contracts of unspecified (indefinite) duration, if either party intends to terminate the contract for a legally valid reason, they must provide formal advance notice in writing via the Qiwa portal:
Notice Lodged on Qiwa
MHRSD automated timestamp logged into national labor registry
60-Day Active Service Window
Regular salary continues via Mudad + 8h/week paid job search exemption
Contract Formally Dissolved
Article 88 final settlement & End of Service disbursed (within 7–15 days)
3. Article 76: Pay in Lieu of Notice (Badal Al-Indhar)
If either the employer or the employee terminates an indefinite contract without observing the statutory 60-day notice period, the terminating party must pay the other party monetary compensation equal to the employee's wage for the duration of the notice period (or the remaining portion thereof).
4. Article 77: Arbitrary & Unlawful Termination Compensation
If an employer terminates a contract without a statutory justification recognized under Article 80, the termination is classified as unlawful (arbitrary). Under Article 77:
Pre-Termination Checklist: Prerequisites Before Submitting on Qiwa
Before initiating a termination request on the Qiwa platform, verify that the following statutory prerequisites are satisfied to avoid automated system rejections:
Step-by-Step Portal Walkthrough: How to Terminate on Qiwa Individuals
The Ministry of Human Resources and Social Development requires all employee-initiated contract terminations and formal resignations to be lodged through the Qiwa Individuals (حساب الأفراد) portal. Follow these sequential steps:
Step 1: Portal Access and Identity Verification
https://qiwa.sa.Step 2: Navigate to Contract Management
- Sponsoring Establishment Name
- Commercial Registration (CR) Number
- Profession Title (as registered with the Ministry)
- Contract Start Date and Renewal Date
Step 3: Initiate the Termination Request
Step 4: Specify Statutory Reason and Notice Period
- Resignation / Non-Renewal upon Expiry (الاستقالة / عدم الرغبة في التجديد)
- Mutual Agreement Termination (إنهاء بالاتفاق الودي)
- Statutory Labor Violation by Employer under Article 81 (مخالفة المادة 81)
- The Qiwa system will automatically populate your statutory notice period (default 60 days).
- If you and your employer have a pre-existing written agreement to shorten the notice period, enter the requested reduced duration (e.g., 30 days). Note that the employer must log into Qiwa Business to digitally approve this reduction.
Step 5: Final Review and Submission
Statutory Rights During the 60-Day Notice Period
Submitting a contract termination request does not grant an employee the legal right to stop working immediately. During the 60-day notice window, the following legal rules apply:
Statutory Safeguards & Rights Protection
Mandatory protections enforced by MHRSD & Saudi Labor Law
The Article 78 Job-Search Exemption
Under Article 78 of the Saudi Labor Law, during the active statutory notice period, the employee is legally entitled to take one full day off per week (or 8 working hours during the week) with full pay to attend job interviews or search for new employment. The employee must coordinate the timing of this day with the employer at least 24 hours in advance.
End of Service Benefits (ESB) & Final Settlement Timelines
Upon completion of the notice period, the financial and administrative relationship must be finalized in strict accordance with Article 88:
1. Statutory Payment Deadlines
2. End of Service Calculation Formula (Articles 84 & 85)
End of Service Gratuity (مكافأة نهاية الخدمة) is calculated based on the employee's last drawn actual wage (Basic Salary + Housing Allowance):
Resignation Reductions Under Article 85:
If the termination is initiated by employee resignation (under an indefinite contract), the gratuity is adjusted according to total tenure:
Need an accurate breakdown? Use our interactive regulatory tool to calculate corporate payroll liabilities: Business Setup & Corporate Cost Estimator.
Top 5 Qiwa Termination Error Codes & Technical Fixes
When processing contract terminations on Qiwa, users frequently encounter automated gateway rejections. Below are the statutory causes and verified resolutions:
| Error Message on Qiwa | Root Cause | Technical Resolution |
|---|---|---|
| "Cannot Terminate: Pending Request Already Exists" | An active transfer request, occupation change, or prior amendment is pending. | The establishment or employee must cancel the pending workflow in Qiwa Requests before lodging the termination. |
| "Contract Status: Not Eligible for Termination" | The contract is still categorized as a draft or has passed expiry without renewal. | If expired, the contract is legally dissolved; request a formal End of Service release via MHRSD Labor Office rather than Qiwa. |
| "Establishment File Suspended / Red Tier" | The sponsoring company has unresolved ministry violations or zero Saudization points. | The employee is legally exempted from completing notice under Article 81 and can transfer immediately to a new sponsor. |
| "National Address Verification Timeout" | Discrepancy between Saudi Post (SPL) address and Qiwa record. | Update your National Address on the SPL portal, wait 24 hours for government data sync, and re-login via Nafath. |
| "Notice Period Exceeds Allowable Limit" | A notice period greater than 90 days was manually entered. | The default maximum statutory notice recognized by the automated engine is 60 days unless pre-agreed in the original contract. |
What Happens to Your Iqama and Residency After Termination?
For expatriate workers in Saudi Arabia, completing a Qiwa contract termination triggers a 60-day statutory grace window:
Once the notice period concludes on Qiwa, your profile becomes immediately available in the Ministry pool for service transfer. Your new employer can issue a transfer request on Qiwa Business, which you can accept instantly without requiring a No-Objection Certificate (NOC) or Kafeel release.
If you choose not to transfer, your sponsoring employer is legally required to issue a Final Exit Visa within the 60-day window and cover your return travel ticket (Article 40), provided you have not breached contractual obligations.
Employers are strictly prohibited by ministerial directive from filing an "Absent from Work" (Inqita' an al-Amal / formerly Huroob) report against an employee who has an active, legitimate termination or transfer request logged on the Qiwa platform. Any such filing will be rejected by the automated system and can be overturned immediately through an MHRSD online labor complaint.
Frequently Asked Questions (FAQs)
Can my employer reject my contract termination request on Qiwa?
No. Under the reformed Saudi Labor Law, an employment contract is not a lifetime bond. If you submit a termination request observing the statutory 60-day notice period for an indefinite contract, the employer cannot unilaterally "reject" or cancel your notice on Qiwa. Once the 60 days elapse, the contract terminates automatically by system operation.
Can the notice period be reduced to less than 60 days?
Yes, but only by mutual written consent. If you request a 30-day notice period on Qiwa Individuals, your employer must log into Qiwa Business and accept the reduced date. If the employer does not explicitly accept the reduction, the standard 60-day statutory countdown remains binding on both parties.
What happens if I stop reporting to work during the notice period?
If an employee ceases working without legal justification before the notice period expires, the employer has the right to withhold wages for the unserved days, deduct pay in lieu of notice under Article 76, and submit a formal dispute with the Labor Office. It is essential to fulfill your daily duties until the official last working day.
Can an employer force me to sign a paper resignation instead of Qiwa?
No. Paper resignations have no administrative standing within Ministry of Human Resources automated systems. Always ensure your resignation is documented directly through the Qiwa platform to safeguard your legal rights, track your notice countdown, and establish proof for your End of Service gratuity.
Can I withdraw or cancel a termination request after submitting it on Qiwa?
A termination request can only be canceled if both parties agree. If you submitted a termination request in error, you must request your employer to submit a cancellation request on Qiwa Business, which you must subsequently accept on your Individual dashboard before the notice period expires.
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Advocate High Court (Punjab Bar Council) and ATT GCC VAT Certified Specialist. Author of comprehensive regulatory commentaries on Saudi corporate law, ZATCA e-invoicing protocols, and Labor Reform Initiatives.