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INDEMNITY CALCULATION IN BAHRAIN LABOUR LAWS

According to Bahrain Labour Law Indemnity is protection or compensation is right of every employee given when employee service is ended or terminated. To understand the laws related to indemnity or end of service compensation/ Benefits you must first have knowledge related to you contract, check if your contract is indefinite(permanent) or definite(temporary). There are lot of things in labour laws that were not easy to understand but I try my best to give the simplest possible explanation of each provisions and article related to Indemnity laws.

The legal document which represents Bahrain Labor laws is Law No.36 2012 which is also called  “The promulgation of the labour law in the private sector”. All of below references is taken from that document.

On Which Basis Indemnity(End of Service Compensation) Calculated:

According to Article 47 of Bahrain Labour laws End of Service Indemnity is calculated on the basis of last Basic Salary of the month including Social Gratuity if any. Also those worker who works on a daily basis and get paid for one day as well as given with commission on each sale or production will be given  indemnity  on the basis of Average wage of Last 3 Months.

If employee resigned from his Job after completion of 4 years
Last Drawn Salary: 200 Dinar
Total Number of Years: 4
Calculation: 200x 4
Total ESB: 800 Dinar

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Article 111 Provision on End of Service Indemnity:

For Indefinite Labour Contract Holder:(Termination)

Paragraph A: If company/employer terminates the indefinite contract with worker means if worker is fired by company/employer within period of first three months after starting of employee service. Than in this case employee is not given with compensation but the reason of termination is due to employer  arbitrary reasons or personals reasons than worker is must be given with compensation equals to one month salary.

Paragraph B: In case if worker completes its first three month of service and employer terminate him with no reason or due to any other legal excuse than worker will be given with compensation equals to wage of 2 days of each month OR minimum one month wage OR maximum 12 months wage totally relies on the employer.

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For Definite Labour Contract Holder:(Termination)

Paragraph C: In case the employer terminates or fired his worker in Definite Labour contract without any reason than employer must give his employee with compensation equals to wage of remaining period of the contract. Sometime both parties agrees on lesser compensation but still minimum three months compensation must be given or wage of remaining period whichever is decided by both parties.

Paragraph D: In case of Termination due to Work Performance:  If the employer terminates the labour contract concluded for the performance of a specific work for no reason or for an illegitimate reason, employer shall give the compensation to worker equal to wage of remaining period of labour contract. Sometime both parties agrees on lesser compensation but still minimum three months compensation must be given or wage of remaining period whichever is decided by both parties.

The above article is defined in terms for those who were terminated or fired by employer to reason or not any reason we shall discuss what compensation is given in case if employee successfully. completes its service.

Article 116:

For those employees  who don’t subject to provisions of the Social Insurance Law shall be given with compensation equals to the monthly half wage for each year of service if the contract is completed or terminated less than 3 years of service. In case the service exceed 3 years than compensation equals to each full wage of one month for each year of service will be given to employee. The worker
shall be entitled to a reward for the fraction of a year pro rata the period of service he spent with
the employer. 

Other Articles related to INDEMNITY is 104, 105, 115, 112

For example if an employee completes first 3 year of his employee and his salary of last month is 3500 bhd than he is entitled for 1250+1250+1250 of compensation. These figures can only be derived after calculations through formulas.
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These articles were complicated for normal persons in case you didn’t understand anything or your situation is different from above stated articles than must Comment below.

Find More at Filed Under: Bahrain, Laws Tagged With: Bahrain Labour Laws

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Reader Interactions

Comments

  1. Rosalina Abayon

    January 5, 2017 at 1:24 pm

    Is it applicable to teachers?

    Reply
  2. Raquel manaig

    January 5, 2017 at 2:42 pm

    It is possible for me coz i finish 3years to my old employer… and she not give me any indemnity…
    Coz she said the indemnity is for 5years only

    Reply
    • Editorial Team

      January 5, 2017 at 3:04 pm

      These laws are not for domestic workers may be you have a domestic worker visa thats why she didn’t give you compensation

      Reply
  3. Luz Abuan

    January 5, 2017 at 6:58 pm

    I am working In the salon for almost 21 years now with the same sponsor what indemnity should I get

    Reply
    • Editorial Team

      January 5, 2017 at 8:45 pm

      What is your salary? Type of contract? and visa type domestic worker or normal

      Reply
      • Le-ann Dela cruz

        August 24, 2021 at 12:41 pm

        I’m a household service worker my salary is 150bd and I finish my 2years 6 months contract but still I’m working here how much do i get for my indemnity? Thanks in advance

        Reply
  4. Roderic gabion

    January 5, 2017 at 8:29 pm

    Hi can I ask question about my indemnity calculation if my salary basis is 466bhd how much total I get If I resign within 8 years . Thanks and good day.

    Reply
    • Editorial Team

      January 5, 2017 at 8:44 pm

      3,728 bhd
      as you completed 3 year and exceed to 8 years you get indemnity equal to full last wage for each year of your service.

      Reply
  5. Kris

    January 5, 2017 at 9:57 pm

    If the employee got terminated long time ago thus she still have a chance ti take her money rights to her old employer ? Let say 1 year ago.

    Reply
    • Editorial Team

      January 7, 2017 at 8:23 am

      Yes according to Article 47 of bahrain labour laws it is right of employee to be given with indemnity

      Reply
  6. sheryl

    January 5, 2017 at 10:28 pm

    If I am getting 168bhd salary, how much I can get indemity if I am 3yrs in the company?

    Reply
    • Editorial Team

      January 7, 2017 at 8:26 am

      If you work less than 3 year you get 84 x 2 = 168
      Work for 3 year or more than full basic wage of per year service
      lets say if you work for 3 year than 504 indemnity

      Reply
  7. MD. HAYDER

    January 5, 2017 at 11:16 pm

    My basic salary is now 151 bhd. I have finished almost 7 years. Aproximitly how much I can get my indemnity? Moreover I will resign after completing 7 years.
    Thanks & Regards

    Reply
    • Editorial Team

      January 7, 2017 at 8:28 am

      You worked for more than 3 year means you can get full basic wage of per year service
      Basic salary 151
      Years work 7
      so 151 x 7 equals to 1057

      Reply
  8. HAMID KHAN

    January 6, 2017 at 1:59 am

    Sir I worked with my single sponsor 6 years if I give resign how much indemnity I can get my basic salary is 140 BD Visa is restaurant

    Reply
  9. Sam

    January 6, 2017 at 4:28 am

    I unerstand that the indemnity payable is on the total wages. Please explain.

    Also, if the employer terminate the contract after 25 years, is he eligible for both, indemnity as per clause 116 and compensation as per clause 111? Please explain?

    Reply
    • Editorial Team

      January 6, 2017 at 6:58 am

      In this case employee complete its 3 years and exceeds so clause 116 is applicable

      Reply
  10. Jesusa S. Candia

    January 6, 2017 at 6:39 am

    Mam/Sir, my contract is finish by February of this year to complete 4 years contract but I am terminated last December -3 ,2016. My basic salary is 315 bd + 150bd for housing allowance and 32 bd for food allowance . How much they should give me total amount of my indemnity? And one more question the company giving me a chance to find a job here . My question is How many months should company giving me a time to used my visa ?

    Reply
    • Editorial Team

      January 7, 2017 at 8:15 am

      As your service exceeds 3 years you can get indemnity of 4 year basic wage 315 x 4…
      Regarding job finding this relies on your visa validity see how much valid is your visa to stay in bahrain

      Reply
  11. leah

    January 6, 2017 at 10:57 am

    I am working 3 years in my company as a sale executive sadenly they force me to change my position as a greeter ang im not agree . Now the office said they will terminate me.

    Reply
    • Editorial Team

      January 7, 2017 at 8:16 am

      If they terminate you..
      You can still must be given with compensation

      Reply
  12. Jesusa Luzano Laxamana

    January 6, 2017 at 11:38 am

    Hi, it’s been a year and 4 months since I resigned from my first job here in Bahrain. When I resigned i was told that they will release my indemnity money as soon as I present to them my new visa and I did it in just 2 weeks but until now I’m not getting any amount from them and they keeps on ignoring my messages and i don’t even know how much I should get as they don’t want to tell me. I worked with them for almost 5 years and my last monthly salary was BHD200. What should I do and how much should I get?
    Thank you very much.

    Reply
    • Editorial Team

      January 7, 2017 at 8:18 am

      5 year means you can get indemnity of last full basic wage equal per year
      200 x 5 = 1000bhd

      Reply
  13. Subhash singh

    January 6, 2017 at 11:52 pm

    I worked five years Sheraton bahrain hotel but I terminated and I didn’t got my any indemnity s per human resources I don’t have right to get any indemnity in case of termination. Kindly help me coz I loss huge amount of my hard work

    Reply
    • Editorial Team

      January 7, 2017 at 8:19 am

      How much time do you work their
      If you terminated within less than 3 months after staring job you don’t get any indemnity

      Reply
  14. hayatulai seidu

    January 7, 2017 at 4:16 am

    Salam sir I have work with my employer for five year…and have terminate my contract how indemnity will get from him please can u help me with that

    Reply
  15. Sherly

    January 7, 2017 at 5:20 am

    I just want to know if the employee If the employee works in percentage rate of salary thus he has a right to get indemnity and how much it will get?

    Reply
  16. Sherly

    January 7, 2017 at 5:22 am

    I just want to know If the employee works in percentage rate of salary thus he has a right to get indemnity and how much it will get?

    Reply
    • Editorial Team

      January 7, 2017 at 8:21 am

      He can get indemnity of last 3 months salary

      Reply
  17. kamau m

    January 7, 2017 at 5:31 am

    I cancelled my contract why my company, after working wth them for 2 yrs i did everything formally i sent cancellation on August, n stopped working on November because i was to go for vacation, until now am not been paid my salary since september, october, 2yrs leave n rest benefit n my ait ticket, i have pending case at court, its over a month now which my company thy never respond to even at court , what does the does government do to help such cases i can’t afford a lawyer , i need legal advice i need my benefit,can anyone help ?

    Reply
    • Editorial Team

      January 7, 2017 at 8:22 am

      It is a matter that can be discussed with lawyer

      Reply
  18. Chamila ranasingha

    January 8, 2017 at 5:25 am

    I am working 5years and 2month one company.but one of employees have problems .but that problem put my head the company terminated me.in case how I can get my indemnity.my basic salary 105.+50elauns so how I can get that.please help me.my company say they not give my indemninty

    Reply
  19. Chamila ranasingha

    January 8, 2017 at 6:35 am

    I am working 5years and2month one company.but they terminated me that not my reason.ather employees do it that but company mananegment say they will terminated me .my salary there basic 105+50 elounse.so how I can get get my indemnity.please help me know about that

    Reply
  20. Eduardo dacanay

    January 10, 2017 at 6:56 pm

    Hi good day sir,
    Can i ask regarding indemnity for almost 1yr 1/2 it’s possible toget indemnity if i iam going to resign to my previous company now, which article that i can find that law, so that i can show to them.
    Looking forward to your reply,
    Thank you and have agoodday ahead.

    Reply
  21. Michelle

    January 11, 2017 at 3:50 pm

    I’m working almost 8 years same boss but different different visa , if I want to go vacation I can get my indemnity ? Or I need to resign? If I resign how much I can get ?

    Reply
  22. Christian palileo

    January 14, 2017 at 10:39 pm

    Hello… just want to ask how about if my contract is 2 yrs but my employer just give me 1yr visa, and now I want to resign after I finish my 1yr or at the end of my visa, can I still get any indemnity???what’s the calculation if this will happen??? Thank you very much…

    Reply
    • Editorial Team

      January 15, 2017 at 1:17 am

      yes last monthly half wage

      Reply
  23. Amoj

    January 22, 2017 at 5:18 pm

    I am working as an engineer for 2 years and 6months already in a construction firm and my basic salary is 700bhd i finish my contract already for 2 years. If i am going to end my service now less than 3 years, how much indemnity i will get?

    Reply
  24. Wasim ayyub

    January 22, 2017 at 8:42 pm

    Hello sir,
    I m working here in one coffee shop for last 5 year I will finish my contract at June 6th 2017 full 5 year in this situation what indemnity I should get??

    Reply
  25. Belle

    February 13, 2017 at 2:39 am

    Good day ,
    Ma’am sir i just wanna ask im 2 years and 11month already in the company then i resigned my basic is 155bhd +60bhd allowance how much i will get indemnity ? Is it possible also to answer me coz my employer wants me to pay back to company coz i will resigned.

    Reply
  26. Jesha

    February 13, 2017 at 6:04 am

    Hi good morning..i would like to ask my basic salary on my 1st year was 168bd and then it increases to 200 until i reached my 3yrs it was increase to 257 bd. Now im almost 4yrs and i resigned…i dont know how they calculate my indemnity.please help me thank u

    Reply
  27. tessie s. romero

    February 13, 2017 at 7:07 am

    how much will i get if my salary is 160 and work in the same company for 28 years.plesae help

    Reply
  28. Joseph punzalan

    February 13, 2017 at 8:10 am

    who completed 3 years of service, the employee will received half of his monthly salary multiply into 3 years, now my question is monthly salary means gross salary ( including housing and transport allowance) or only basic salary?

    Reply
  29. Jaja

    February 13, 2017 at 8:59 am

    I work in a company for 5 yrs
    Each contract every 2yrs they giving me one month salary indemnity equivalent of 145 bd becoz this my salary. In 4yrs I have only recieve 2 indents.
    In my 5th year I resign what I get only is one year compensation becoz this only I finish.
    Is this rigth?? Can I make complain to the LMRA for this??

    Reply
  30. Gleen

    February 13, 2017 at 12:13 pm

    How about 500 salary and finished for 4 years?

    Reply
  31. Cassandra

    February 15, 2017 at 1:01 pm

    Hi im working since 2013 in a salon and i am almost 4 yrs and will be finish my visa this month.. my basic salary is 150.. how much is the computation of my indimity

    Reply
  32. Sujith

    February 17, 2017 at 11:12 am

    Hi

    My company is deducting 1% of my full salary everymonth and saying that is GOSI contribution. Is it deduct from staffs Salaries or compnay is the one should pay?. For expatriates also they are deducting the same amount every month salary.

    Our compnay is under dubai management but CR is under on local bahraini sponsor.

    So please let me know is the deduction is from employees salary or by employer ?.

    How to stop this .

    Thanks

    Reply
  33. Editorial Team

    February 17, 2017 at 3:32 pm

    Social Insurance

    All foreign and local staff are required to be
    registered with the General Organization for
    Social Insurance (GOSI). GOSI contributions
    are as follows:

    For Bahraini employees: Employer pays 10%of basic salary and recurring constantallowances, employee pays 5% of basic salaryand constant allowances
    For expatriate employees: Employer pays 3%of basic salary and recurring constantallowance

    @For more information please contact theInsurance Contribution & Statistics Directorateat GOSI at Tel: (+973) 17532222; Website:http://www.gosi.org.bh

    Reply
  34. Lea pangilinan

    February 18, 2017 at 9:57 am

    It’s only for companies compensation,
    How about house worker?

    Reply
    • Editorial Team

      February 18, 2017 at 10:16 am

      these Labor laws are not for domestic workers

      Reply
  35. Jiju Sreekumar

    March 8, 2017 at 6:34 pm

    Am an electrical supervisor and completed 2 years in my company. Now I
    resigned from my Job and company is paying SOI and gosi. Am I eligible for indemnity ???

    Reply
  36. Given Estor

    April 15, 2017 at 10:44 am

    Im 1year and 7months working in my present company and I filed my resignation already and decided to go back to my country for good…do I have the right to get an indemnity?? And how about my ticket going back to my country is it my obligation to buy my own ticket or the company must provide it for me??? Im a local transfer here in bahrain thanks hope you can answer my inqueries…

    Reply
  37. Balajidevendran

    August 26, 2017 at 9:47 am

    I am 8year and 11 month working in my past company and still not getting indemnity money so how much coming for amount and how to do calculations pls …basic 280bd

    Reply
  38. Shashin Kumar

    September 26, 2017 at 10:22 am

    hi I am working here in Bahrain for last 11years for same employer and our benefits were calculate as salary+ hra, but last 2month back they stopped paying including HRA. it was shocking coz who ever left 2months before got that and when we asked the company they told us that is there any thing in writing that we have told that we will pay including that? this point we had nothing to talk. many employee who served 30years or so lost a huge sum of money which would help them in their old age. is there any ways to fight for it (shashinsn@rediffmail.com)

    Reply
  39. Zenaida Bendicio

    October 9, 2017 at 8:43 pm

    Dear Sir /Madam,
    I’m working Beautician 8 years this coming March 3, 2018 but every 2 years i’ll go Philippines my sponsor she’s giving me 2 months salary but I want to finish my contract until March 3, 2018 for, for good because every time the sick is coming to me every time I’m in the hospital I want to ask you only if I go Philippines for, for good on 8 years my sponsor she will give me money! Thank you very much

    Reply
  40. Noel C. Garcia

    May 8, 2021 at 12:13 pm

    Hi sir/Madam,

    I worked in my company for almost 13 years. I started working in Bahrain from July 2008, then we got a project in Qatar so they cancel my Bahrain CPR in 2014 to get me a Qatar ID. After the project in Qatar the company sent me back in Bahrain on 2016. I did not get my indemnity when they cancel my Bahrain CPR, How will my indemnity be calculated until 2021 if there is a gap. Thanks in advance.

    Reply
  41. Adrian domingo

    July 12, 2021 at 4:25 am

    How much the the imdemnity I resign in 2yrs my salary is 230..tnx

    Reply
  42. Asarudeen

    July 19, 2021 at 8:07 am

    I am an accountant, basic salary BD: 250/-.
    I need to cancel my Visa.

    Please give my all visa settlement details.

    Note: Is possible to get visa transfer or visa release a Accountant only.

    Reply
  43. Eugene Honrejas

    August 20, 2021 at 5:55 pm

    Hi sir, Good day to you. Beside from basic salary, are allowances included in the computation of indemnity? like housing allowance and transport allowance?
    Thank you for your reply.

    Reply
  44. JOSELITO OCINADA OBERES

    September 8, 2021 at 10:52 am

    I just want to ask if the allowances like (accommodation & Transport) is included the calculation of indemnity once you will finished the contract with the company. Because we are on depending project basis.

    Thanks

    Reply

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