Kuwait Labor Law No. 6 of 2010 — Article 51
"The worker shall be entitled to an end of service benefit as follows:
- For workers paid on a monthly basis, a remuneration of 15 days for each of the first five years of service and one month remuneration for each year thereafter. The total indemnity may not exceed one and a half years remuneration.
- For workers paid on a daily, weekly, hourly or piecework basis, a remuneration of 10 days for each of the first five years and 15 days for each subsequent year, with a maximum cap of one year's remuneration."
- For workers paid on a monthly basis, a remuneration of 15 days for each of the first five years of service and one month remuneration for each year thereafter. The total indemnity may not exceed one and a half years remuneration.
- For workers paid on a daily, weekly, hourly or piecework basis, a remuneration of 10 days for each of the first five years and 15 days for each subsequent year, with a maximum cap of one year's remuneration."
What Counts as "Remuneration" for Indemnity?
One of the most litigated questions in Kuwait labor courts is whether indemnity is calculated on basic pay or full gross package. Under Article 55 of Law No. 6/2010 and consistent rulings by the Kuwait Court of Cassation:
✓ Included in Calculation
- Basic monthly salary
- Fixed housing allowance
- Fixed transportation allowance
- Regular food allowance
- Fixed periodic bonuses granted uniformly
✕ Excluded from Calculation
- Occasional irregular travel reimbursement
- Discretionary performance bonuses
- Overtime payments
- Reimbursable medical claims
- Temporary field hazard allowances
Fixed-Term vs Open-Ended Employment Contracts
Under Kuwait law, how your contract terminates affects your rights:
- Fixed-Term Contract (Specified Period): When a fixed-term contract expires without renewal, the employee is entitled to 100% full indemnity regardless of who decides not to renew, provided service exceeds one year.
- Open-Ended Contract (Indefinite Duration): Either party may terminate with statutory 3 months' written notice. If the employer terminates without cause, full indemnity is paid. If the employee resigns, the tiered reductions (0%, 50%, 66.67%, 100%) apply.
Article 70: Accumulation and Payout of Unused Annual Leave
According to Article 70, workers are entitled to 30 paid days of annual leave per year after continuous employment of 9 months. Upon leaving service, the employer must compensate all accrued unused leave days computed on the final daily wage rate (Salary ÷ 26).
Calculate Your Labor Law Rights Instantly
Our online calculator implements all provisions of Article 51 and Article 70 automatically.
Go to Free Calculator