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Final settlement and release form (Word & PDF)
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For an employer and a worker, or two companies, recording the sums paid and the release after the relationship or the job ends. In Saudi Arabia the worker’s release is signed after the contract ends. It is not the settlement of a commercial dispute that was never employment.
Sources: 4 official sourcesNot legal advice
What this template includes
After the relationship ends, not during it
A final settlement and release in Arabic and English for a worker after the relationship has ended, or between two companies if clause 11 is kept. In Saudi Arabia a release of the worker’s rights during the contract is void unless it is more beneficial to the worker, so the form is signed after the end. The glossary entry is release and discharge. The contract is the employment contract template, the letter that ends it is the resignation letter, and a dispute that is not employment is the settlement agreement. This is a starting point. Have it reviewed by a lawyer licensed in the relevant jurisdiction before you use it.
What the release covers
Wage through the last day, leave pay, the end-of-service award, a deduction that has a basis, the service certificate, and any confidentiality or non-compete that survives. The settlement time written here is the Saudi Labor Law: one week, or two weeks if the worker ended the contract.[1] The UAE payment deadline was not verified, so it is not stated.
- Saudi Arabia: half a month for each of the first five years and one month after that, and the claim is not heard after twelve months from the end.[1]
- UAE: 21 days then 30, on basic wage, for a full-time foreign worker after one year. A national follows the pensions legislation. An individual labour dispute is Article 54.[2] See end-of-service gratuity.
- Clause 11 is a balance between two companies or with a contractor. Bahrain and Oman are cited for the civil-law settlement, not for a labour statute.[3][4]
- Qatar and Kuwait: the labour statute was not checked. Do not copy the Saudi or UAE formula.
The template
Final settlement and release
A release between a worker and an employer after the relationship has ended, or between two companies or with a contractor if clause 11 is kept. In Saudi Arabia do not sign the worker’s release while the contract is still in force. Replace every [bracket]. This is a starting point. Have it reviewed by a lawyer licensed in the relevant jurisdiction before you use it.
This release is made on [date] between [the employer], commercial registration [●], of [●] (the “Employer”) and [the worker], identity / residence [●], of [●] (the “Worker”).
The relationship began on [date] and ended on [date] because [expiry / resignation / termination by the employer / agreement].
Drafting note
In Saudi Arabia the cause changes the time: one week if the employer ended it, two weeks if the worker ended it.[1]
The Worker has received the sums in Annex 1: wage through the last day, leave pay, the end-of-service award, allowances and commission, and a return ticket if there is one.
Drafting note
In Saudi Arabia: half a month’s wage for each of the first five years, and one month’s wage for each year after that.[1] In the UAE, a full-time foreign worker with one year or more is paid on basic wage: 21 days for each of the first five years and 30 days for each year after. A national is governed by the pensions legislation.[2] See end-of-service gratuity.
[Amount] is deducted for [a debt arising from the work]. The basis is [●]. A deduction without a basis is not made.
Drafting note
Do not write a deduction you cannot describe. The cap is in the labour law, not in this form.
The Worker acknowledges receipt of the net sum of [●] by [transfer to account ● / the wage-protection system] on [date].
The Worker releases the Employer from claims arising out of this relationship up to the end date, once the Annex 1 sums are received. The release does not cover a right that cannot be waived.
The Worker has returned: [●]. The Employer will issue a service certificate on request, at no charge.
Drafting note
In Saudi Arabia the service certificate is free on request.[1]
Confidentiality continues for [●]. A non-compete, if the contract has one and it is written and limited: [survives / delete].
Drafting note
See non-compete clause and probation period. Do not copy a restriction wider than the contract and the statute.
This release is governed by [the Saudi Labor Law / UAE Federal Decree-Law No. 33 of 2021 / ●]. A dispute goes to [●].
Drafting note
Individual labour disputes in the UAE are Article 54.[2] For a civil settlement see settlement.
Employer: name [●] · signature [●] · date [●]
Worker: name [●] · signature [●] · date [●]
Witness 1: [●] · Witness 2: [●]
Between [company A], registration [●], and [company B or the contractor], registration [●]. Settled balance: [●]. Work handed over: [●]. Each party releases the other for this balance and this work, not for another contract.
Notes for Saudi Arabia
The Labor Law. The release is signed after the relationship ends.[1]
| Point | Text |
|---|---|
| During the contract | Any release or settlement of the worker’s rights while the contract is in force is void unless it is more beneficial to the worker (Article 8).[1] |
| Time | Rights are settled within one week at most, and within two weeks if the worker ended the contract (Article 88).[1] |
| Award | Half a month’s wage for each of the first five years, and one month’s wage for each year after (Article 84).[1] |
| Hearing the claim | The claim is not heard after twelve months from the end of the relationship (Article 222).[1] |
| Certificate | The service certificate is free on request (Article 64).[1] |
Notes for the United Arab Emirates
Federal Decree-Law No. 33 of 2021. The deadline for paying sums after the relationship ends was not verified, so it is not stated.[2]
| Point | Text |
|---|---|
| Award | A full-time foreign worker with one year or more, on basic wage: 21 days for each of the first five years and 30 days for each year after. A national is governed by the pensions legislation (Article 51).[2] |
| Dispute | Individual labour disputes are Article 54.[2] |
Notes for a commercial release
Clause 11 only. Labour statutes in these countries were not checked here.[3][4]
Qatar and Kuwait
- Qatar: the Labour Law was not checked for this page. Do not copy a Saudi or UAE deadline or award formula.
- Kuwait: the private-sector labour law was not checked. Have the release read by a Kuwaiti lawyer.
Annex 1: The sums
Write the amount and its basis. The net is what clause 5 acknowledges.
| Item | Amount | Basis |
|---|---|---|
| Wage through the last day | [●] | [●] |
| Leave pay | [●] | [●] |
| End-of-service award | [●] | [Article 84 / Article 51] |
| Allowances and commission | [●] | [●] |
| Return ticket, if any | [●] | [●] |
| Deductions and their basis | [●] | [●] |
| Net | [●] |