How Bahrain gratuity is calculated
Article 116 of the Bahrain Labour Law (No. 36 of 2012) sets the leaving indemnity at:
- Half a month's wage for each of the first three years.
- One month's wage for each year after three years.
- Part years paid in proportion.
Resigning does not reduce it. It is lost only for dismissal for gross misconduct under Article 107.
Who pays: employer or SIO
Since 1 March 2024, employers pay monthly end of service contributions for non-Bahraini workers to the Social Insurance Organisation (SIO): 4.2% of annual wage for each of the first three years and 8.4% after. When you leave, you claim the part earned from 1 March 2024 from the SIO. The part earned before 1 March 2024 is still paid by your employer. The calculator shows both parts.
Worked examples (wage BHD 500)
| Service | Indemnity |
|---|---|
| 1 years | BHD 250 |
| 2 years | BHD 500 |
| 3 years | BHD 750 |
| 5 years | BHD 1,750 |
| 7 years | BHD 2,750 |
| 10 years | BHD 4,250 |
Example for 5 years: 3 × BHD 250 = BHD 750 for the first three years, plus 2 × BHD 500 = BHD 1,000. Total BHD 1,750.
More for Bahrain
Add leave and notice with the Bahrain final settlement calculator, or compare countries in the GCC gratuity comparison.
Sources
- Bahrain Labour Law for the Private Sector, Law No. 36 of 2012
- Resolution No. 109 of 2023 on end of service payments through the SIO
- Social Insurance Organisation (SIO)
- Labour Market Regulatory Authority (LMRA)