INDEMNITY UNDER OLD AND NEW LABOUR LAW - BAHRAIN

1976 v/s 2012

 LABOUR LAW 23/1976

 Article 111

In respect of categories of workers to whom the provisions of the Social Insurance Law are not applicable –

Where Employer Terminates:

Leaving Indemnity will be calculated: fifteen days' wages for each year of the first three years of service and of one month's wages for each year of service thereafter. Such worker shall be entitled to payment of leaving indemnity upon a quantum meruit (what he has earned) in proportion to the period of his service completed within a year.

Where Worker Terminates:

Leaving Indemnity will be calculated: one third of the leaving indemnity if the period of his service is not less than three consecutive years and not more than five years. Full leaving indemnity if he resigns after the completion of five years of service, provided that such termination of a contract of service by the worker is not used by the worker as a means to avoid dismissal from employment in accordance with the provisions of Article 113 and provided also, that he shall notify the employer concerned of his intention of leave his employment in accordance with the provisions of Article 107 of this Law; the worker may, in lieu of such notice, pay to the employer an amount equivalent of the wages payable for the required period of notice.

(Article 113, allows termination without notice, compensation and indemnity where the employer dismisses the worker for: false identity or submitted false certificates or testimonials, caused serious material damage to the employer, despite a written warning fails to comply with written safety instructions, absents himself without reasonable cause for more than twenty days in one year or for more than ten consecutive days, fails to perform his essential duties, discloses the secrets of the establishment, sentenced for a crime or a misdemeanor involving dishonour, dishonesty or immorality, found during the hours of work to be under the influence of alcohol or drugs, assaults his employer or responsible representative or supervisors during the course of employment)

 

LABOUR LAW 36/2012

Article (116)

A worker who is not subject to the provisions of the Social Insurance Law shall be entitled upon the termination of his employment to a leaving indemnity at the rate of half month’s wage for each of the first three years of employment and one month’s wage for each of the following years in service. A worker shall be entitled to receive his leaving indemnity for fractions of the year in proportion to the period spent in the employer’s service.

The calculation of leaving indemnity under the New Labour Law would be the same irrespective of who terminated or why the employment relationship was terminated.