What is the end of service indemnity in Kuwait?
The indemnity is the payment a private sector worker receives when the job ends. Article 51 of the Private Sector Labour Law (Law No. 6 of 2010) sets it. Other Gulf countries call the same thing gratuity or end of service benefit.
For a worker paid monthly, Article 51 gives:
| Years of service | What you earn for each year |
|---|---|
| First 5 years | 15 days of wage |
| After the 5th year | 1 month of wage |
| Limit | 18 months of wage in total |
A part year counts in proportion to the time worked.
- 1Take your last monthly wage
- 2Divide by 26 for the day's wage
- 315 days for each of the first 5 years
- 4A month for each year after
- 5Apply the 18-month limit and the resignation share
Which wage counts?
Use your last total wage: basic salary plus the allowances you are paid every month, such as housing and transport. One-off bonuses and expense refunds are left out. This is different from the UAE, where only basic salary counts.
The day's wage is the monthly wage divided by 26. Article 67 divides the salary by the actual working days, without the weekly rest days, which is about 26 in a month. Some employers divide by 30. That makes the day's wage smaller, so your indemnity is smaller too.
Worked examples
Example 1: the employer ends the contract after 4 years, wage KWD 500
- Day's wage: 500 ÷ 26 = KWD 19.231
- 15 days × 4 years: 15 × 19.231 × 4 = KWD 1,153.846
Example 2: the employer ends the contract after 8 years, wage KWD 600
- First 5 years: 600 ÷ 26 × 15 × 5 = KWD 1,730.769
- Next 3 years: 3 × 600 = KWD 1,800.000
- Total: KWD 3,530.769
Example 3: a very long service, 30 years, wage KWD 500
- First 5 years: KWD 1,442.308
- Next 25 years: 25 × 500 = KWD 12,500.000
- Together KWD 13,942.308, but the limit is 18 × 500 = KWD 9,000.000
With a wage of KWD 500 the limit is reached after about 20 years of service. Most workers never get there.
What do you keep if you resign?
If the employer ends the contract, you get the full indemnity. If you resign from an open-ended contract, Article 53 cuts it:
| Years of service | Share you keep |
|---|---|
| Less than 3 | Nothing |
| 3 to under 5 | Half |
| 5 to under 10 | Two thirds |
| 10 or more | All of it |
| Wage KWD 500, resigning after | Full indemnity | You keep |
|---|---|---|
| 2 years | KWD 576.923 | KWD 0.000 |
| 4 years | KWD 1,153.846 | KWD 576.923 |
| 5 years | KWD 1,442.308 | KWD 961.538 |
| 10 years | KWD 3,942.308 | KWD 3,942.308 |
The year counts matter a great deal. Resigning at 4 years and 11 months instead of waiting a month for the 5th year costs a third of the indemnity.
Only a dismissal under Article 41(a) removes the indemnity: a mistake causing serious loss, getting the job by fraud, or revealing work secrets. Other dismissals keep it.
Work out your own indemnity in KWD →
Mistakes people make
- Using 30 days a year for the first 5 years. Some sites say 30 days. The law says 15 days for each of the first 5 years, then a month.
- Dividing by 30 without noticing. On KWD 500 and 5 years, ÷ 26 gives KWD 1,442.308 and ÷ 30 gives KWD 1,250.000. Ask how your employer divides.
- Using basic salary only. In Kuwait the regular allowances count.
- Forgetting the resignation share. Many workers expect the full amount after 3 or 4 years.
- Thinking social security is taken out. Since Law No. 85 of 2017 the employer may not deduct its PIFSS contributions from your indemnity. Debts and loans you owe the employer can still be taken off.
When must it be paid?
The law sets no fixed deadline for the indemnity. Wages may not be paid more than 7 days late (Article 56). If the employer denies your claim, you must claim within 1 year of the end of the contract (Article 144). For the rest of what you receive when you leave, see the Kuwait final settlement calculator and the Kuwait notice period rules. To compare with other countries, read gratuity in the Gulf compared.
This is an estimate under the published law, not legal advice. The Public Authority for Manpower or a court gives the final figure.
Questions people ask about Kuwait end of service indemnity
How is end of service calculated in Kuwait? For a monthly-paid worker: 15 days of wage for each of the first 5 years and a month of wage for each year after, up to 18 months in total (Article 51).
Is the indemnity paid if I resign in Kuwait? Not under 3 years. You keep half from 3 to 5 years, two thirds from 5 to 10 years and all of it from 10 years (Article 53).
Is it paid on basic or total salary? On your last total wage, which includes regular monthly allowances.
What is the most I can receive? 18 months of wage (Article 51).
Does the employer pay PIFSS out of my indemnity? No. The employer may not take its social security contributions from it since Law No. 85 of 2017.
Sources
- Kuwait Labour Law No. 6 of 2010, Arabic text (PAM print, June 2017) (Articles 32, 41, 51, 53, 56, 67, 144)
- Teamed: Kuwait end-of-service indemnity
- Lockton: Kuwait amends labor law on leave and end-of-service indemnity (Law 85 of 2017)
- Kuwait Times: calculating end of service benefits
This guide is general information, checked in November 2026. Rules can change, so confirm with the Public Authority for Manpower.