Civil Retirement Law

Purpose and scope

• Applies to Saudi civil servants appointed to graded posts in the state budget or public bodies' budgets (Article 2), and its fund has independent finances (Article 3).
• A new Social Insurance Law was later issued covering new government employees, so its transitional provisions show who remains under this law.

Key rules, rights and obligations

• Retirement is mandatory at sixty, and service may be extended to sixty-five by Council of Ministers decision (Article 15).
• Deductions are calculated on the full basic salary without additions (Article 14).
• An employee is entitled to a pension after twenty-five years of pensionable service, and may request early retirement after twenty years with the employer's approval (Article 18 as amended).
• The pension is one-fortieth of the average salary of the last two years for each year, up to four-fifths of that average (Article 19).

Violations, penalties and common problems

• If service ends without pension entitlement, a gratuity is paid as a percentage of annual salary per year, at a lower rate on resignation or disciplinary dismissal (Article 23).
• The gratuity is paid at age sixty or on death, and a person reaching sixty with at least ten years' service is entitled to a pension under the amendment (Article 23 bis).
• Pension payments stop if the pensioner is appointed to a permanent government post, under the law's conditions (Article 28).
• Obtaining fund money without right through false information: a fine of up to the amount obtained, plus recovery (Article 39).

Procedures and key deadlines

• It is wise to confirm pensionable service and the addition of earlier service before requesting early retirement or resigning, as this affects the pension or gratuity.

An advisory summary prepared by Al-Bayan Al-Wadih Law Firm. It is not an official text and does not replace the law, its implementing regulations, or advice from a specialised lawyer. The official published text and its amendments prevail.