Cal­cu­lat­ing ter­mi­na­tion in­dem­nity or end of ser­vice ben­e­fits in Kuwait

Kuwait Times - - LOCAL - By At­tor­ney Fa­jer Ahmed

Start­ing a new job and let­ting go of an old workspace can be dif­fi­cult, emo­tion­ally and men­tally. You might be ex­cited about your new work but you also do not want your pre­vi­ous em­ployer to cre­ate ten­sions. Be­cause of this, em­ploy­ees may on some oc­ca­sions let go of their mone­tary rights - there is too much go­ing on for them to cal­cu­late their in­dem­nity or pur­sue it. From my ex­pe­ri­ence, em­ploy­ees usu­ally do not want to cre­ate ten­sions or go to court. So what can you do if you don’t go to court? I sug­gest the fol­low­ing:

1. Try to get the pre­vi­ous em­ployer’s opin­ion or cal­cu­la­tion from them in writ­ing. 2. Try to ne­go­ti­ate with them. 3. Get your lawyer to write a letter to them or ne­go­ti­ate on your be­half.

4. File a com­plaint at shuoon (Min­istry of So­cial Affairs and La­bor).


Ques­tion: Is there an easy way of cal­cu­lat­ing my ter­mi­na­tion in­dem­nity? Can you please ex­plain how I can cal­cu­late it?

Fa­jer: First of all, I would like to make it clear that it is not a lawyer’s job to do the ac­tual cal­cu­la­tions. Even through the le­gal pro­ce­dures, lawyers will not usu­ally cal­cu­late - in­stead ex­perts are called in to cal­cu­late the fi­nal amount (they are usu­ally ac­coun­tants). With that said, the prin­ci­ple of the cal­cu­la­tions is not that hard to master, and I sug­gest that you cal­cu­late it so that you have a rough idea of your ter­mi­na­tion in­dem­nity amount.

This will de­pend on whether you have been ter­mi­nated or you have ter­mi­nated the con­tract.

In the event where you are ter­mi­nated: • Less than 5 years of em­ploy­ment - 15 days’ pay of your salary. • Be­tween 5 to 10 years of em­ploy­ment - 30 days’ pay of your salary. • The to­tal amount should not ex­ceed an amount that is more than one year and a half of salary. In the event where you have ter­mi­nated your con­tract and it is an in­def­i­nite term con­tract: • 3-5 years of em­ploy­ment - half of the in­dem­nity men­tioned above. • 5-10 years - two thirds of the in­dem­nity men­tioned above. • 10 plus years - you will be en­ti­tled to your en­tire in­dem­nity.

Let me give an ex­am­ple. You ended your in­def­i­nite con­tract (with a three-month no­tice pe­riod) and your salary is KD 450 a month. You have been working for seven years with this com­pany. How much is your ter­mi­na­tion in­dem­nity? I have an­swered this ques­tion by break­ing it down to sim­ple steps, as fol­lows:

1) Break down your salary into daily pay. You have 26 working days per month. There­fore, you should di­vide 450 by 26. This will av­er­age to KD 17.310.

2) Cal­cu­late your ter­mi­na­tion in­dem­nity as if you were be­ing ter­mi­nated. That’s 15 days’ pay for the first five years and one month pay for the re­main­ing two years - 15 x KD 17.310 x 5 = KD 1,298.1. 30 x KD 17.310 x 2 = KD 1,038.6. To­tal = KD 2,336.7

3) Cal­cu­late your ter­mi­na­tion in­dem­nity ac­cord­ing to the fact that you have ter­mi­nated the con­tract. For seven years that’s 2/3 of the to­tal above.

26 days

Ques­tion: I am con­fused about how to cal­cu­late my in­dem­nity. I am get­ting paid on a monthly ba­sis and that is usu­ally for 30 days, but my com­pany is cal­cu­lat­ing my in­dem­nity by di­vid­ing my to­tal salary over 26 days. I could not find any­thing in the law that refers to 26 days.

Fa­jer: The rea­son why it is cal­cu­lated 26 days is be­cause you av­er­agely have 26 working days a month Fri­day is the only non-working day a month. Satur­days in Kuwait are usu­ally paid off days. Kuwaiti la­bor law does not state how many days a week we can work, but did state that 48 hours a week max­i­mum/eight hours a day that would be six days then. Even if you do not work on Satur­days, com­pa­nies cal­cu­late Satur­day as paid working day to save money when cal­cu­lat­ing in­dem­nity.

If you have any le­gal ques­tions, please email Ask@Fa­

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