What is Indemnity

Indemnity is also known as End of Service benefits which will be paid when you are leaving a company. Every individual working in Kuwait has the right to get end of service benefits.

Expats in Kuwait are not much aware of the labor law, how the indemnity will be calculated, in this article we will discuss about who are eligible to get indemnity and how the indemnity will be calculated

The Employees often consult legal consultants to clear their doubts regarding Termination Indemnity. . We will try to cover queries related to indemnity as much as possible, so the people can take benefits by getting knowledge on these terms and condition of Indemnity


Who is Eligible To Get Indemnity

According to Kuwaiti Labour Law, any employee working in the private sector, whether Kuwaiti or foreign, is eligible to claim Termination Indemnity. However, some organizations pass false statements to avoid paying it to their employees, which is illegal under the law.

for Kuwaitis Some organizations play another game with their employees since they pay some contributions to their Social Security Funds. The Social Security fund of any employee is credited by both the employee and employer according to the law. Each party, the employee and the employer, pays a fixed percentage. The Organization sometimes decided to pay the Social Security in full with an agreement with Kuwaiti Nationals that the Employees Share of Social Security Fund could be deducted from Termination Indemnity. This kind of understanding between the two is not Legal, Organisations can not bargain with the employees in this manner.

Organisations are supposed to Share the fix percentage in the Social Security Fund of any employee and to pay the Termination Indemnity as well.


How Indemnity is Calculated


It is not rocket science to calculate the same. It is generally done by Accountants for the people, but anyone can learn in some easy steps from the Table (Mentioned below); I prepared this table for the readers for their ready reference. Any Employee who is paid the remuneration monthly,This table can be useful to you.

Indemnity Calculation Table

Indemnity Rules

Indemnity calculations for daily-paid workers

1. Employees who work for less than three years are not eligible for indemnity
2. IF the employee works with the current company for more than 3 years and less than 5 years then he is eligible for 1/3 of monthly salary * no of years worked
3. If the employee works with the current company for more than 5 years and less than 10 years then he is eligible for 1/2 of monthly salary * no of years worked
4. If the employee works with the current company for more than 10 years then he is eligible for Monthly salary * No of years worked

Indemnity Calculation for the workers who are paid on monthly basis

1. A worker is entitled to 15 days of indemnity during the first five years, and one month after that.
2. Employees who resign without completing three years with their employer are not entitled to an indemnity.
3. If the employee completes three to five years and resigns, then he is entitled to half of the indemnity, if he completes five to ten years, then he is entitled to two-thirds.
4. Upon resigning after completing 10 years of work, the worker is entitled to full indemnity, which equals one month's salary per year spent at work. This should not exceed 18 months.


From The Below Links You can Find All Question and Answers Related To Indemnity So You Get Brief Idea

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