Labour Law › End-of-Service Indemnity
Article 51: Terminal Service Indemnity
AmendedIn simple words
This is the end-of-service benefit (indemnity). Monthly-paid workers get 15 days’ pay for each of the first 5 years and one month’s pay for each year after that, up to a maximum of 18 months’ pay. Daily, weekly, hourly or piece-rate workers get 10 days’ pay per year for the first 5 years and 15 days after that, up to one year’s pay. Part years count proportionally. Since the 2017 amendment the employer cannot deduct its social-security (PIFSS) contributions, so you receive the full amount; only debts you owe the employer can be deducted.
Amended
Law No. 85 of 2017 · 9 July 2017
Article 51 was replaced. The indemnity formula stays the same (15 days’ pay per year for the first 5 years, one month’s pay per year after that, capped at 18 months for monthly-paid workers), but the employer can no longer deduct the contributions it paid to the Public Institution for Social Security (PIFSS). The worker receives the full indemnity.
Source ↗Amended
Law No. 17 of 2018 · 6 May 2018
Confirms that Kuwaiti nationals receive the full end-of-service indemnity from their current employer without any deduction for social-security subscriptions.
Source ↗Example
Indemnity after 8 years (terminated)
SituationRavi earns 400 KD a month and is terminated by his employer after 8 years of service.
What the law saysDaily wage = 400 ÷ 26 = 15.385 KD.
First 5 years: 5 × 15 days = 75 days × 15.385 = 1,153.85 KD
Next 3 years: 3 × one month = 1,200 KD
Total indemnity = 2,353.85 KD. This is below the 18-month cap (7,200 KD). Since the 2017 amendment, no PIFSS contribution can be deducted.
Names are made up for illustration.
Official text of Article 51 (2010)
This is the original 2010 wording. Where it differs from the amendment above, the amendment applies.
a) A ten days wage for every one year of service for the first five years and fifteen (15) days wage for every one year of service for the following years, provided that the total indemnity shall not exceed a year's wage, with regard to the labourers who receive their wages per day, week, piece or per hour.
b) A fifteen-day wage for every one year of service for the first five years and one month's salary for every year of the following years, provided that the total indemnity shall not exceed one and a half year's wage, with regard to monthly paid labourers. A labourer shall be entitled to the terminal service indemnity for any part of the year in proportion to the period of service he spent in the work. The amount of any debts or loans which may be due from the labourer shall be deducted from the terminal service indemnity. In this connection, the provisions of the Social Security Law shall be applicable, provided that the employer shall be obliged to pay the net difference between the amounts he affords against the labourer's subscription in the Social Security and the due amounts for the labourer against the terminal service indemnity.
Reference & sources
Kuwait Private Sector Labour Law No. 6 of 2010, Article 51 (Terminal Service Indemnity), Official Gazette Kuwait Al-Youm, Issue No. 963 (2010). Checked October 2026.
Related articles
- 52 · Full Entitlement to Indemnity
- 53 · Partial Entitlement to Indemnity
- 62 · Calculation of Dues
- 54 · Service Termination Certificate
General information, not legal advice. The Arabic text of the law is the official version (Article 29). For your case, contact the Public Authority for Manpower or a lawyer.