Private Sector Labor Law
Ministry of Social Affairs and Labor (MSA&L) enforces the private sector’s labor regulations. The law applies to all private sectors except for the following: domestic servants, workers on temporary contractors and workers working in less than six months. The private sector labor law also does not apply to employees whose employer’s head office is located outside Kuwait unless the company has a Kuwait branch office in which case Kuwait law applies. If the head office is located outside Kuwait and does not have a branch in Kuwait, the private sector law of the country where the head office is located will govern the immigrants working in Kuwait.
Contract of Employment
The employment contract contains the employee’s terms of service. A fixed time or indefinite terms of service may be given by the employer to its employees. Terms of service that does not exceed five years is considered a fixed time.
Private Sector Kuwait Labor Law indicates the minimum limit which terms of service may not fall. If a part of an employee’s contract gives him less benefit than his right under the law, he is at liberty to the minimum indicated by the law in the particular term.
Any employment contract may be verbal or in writing. In both cases, a contract must give you an idea about the description of the job, remuneration payable, date of appointment and the service length ( if fixed).
In case of dispute involving a verbal contract, either side can use circumstantial evidence to prove the agreed verbal agreement. Arabic is the language used for written contracts. A contract translated into another language may be attached but when resolving disputes, the Arabic version will be considered in a court of law.
An employee can be hired under probation status for a maximum of 100 days. This can only be applied by the same employer once for each of their workers. Contracts that are still under the probation days can be terminated without prior notice. An accumulated compensation will be given to the employee.
Remuneration & Deductions
Basic pay, commissions, obligatory bonuses, incentives, gratuities from the third parties and employee benefits such as housing allowances is included in the remuneration. Allowances on account of expenses and profit shares are not included in the remuneration. If the employee’s contract or the firm’s by-laws include bonus payment or if the same amount has been paid regularly every year, the company is obliged to pay the workers’ bonus.
The content of the remuneration is very significant. In case of injury, the amount included in the remuneration is used to compute the terminal compensation or indemnity. The payment may vary based on the payment type of the worker. If an employee’s salary is paid on based on number of hours worked, the company will use the last salary payable. If an employee’s salary is based on the piece-worked, the company will compute the average wage of the amount payable to the employee for the last three months.
No minimum wage is stated in the private sector labor law. A monthly salary should be paid for hired employees. Salaries can be given every two weeks for piece-workers and workers who are under the hourly and weekly wages. If a subcontractor failed to pay their workers salaries, each worker may demand payment from their employer’s superior contract. This is true for cases when the employer’s superior did not pay for the work done by the subcontracted employees. Payment for employees’ salaries and termination benefits is given priority before an employer’s other creditors when an employer declares bankruptcy.