Kuwait end-of-service indemnity explained

By Zulu Calculator · Updated 12 October 2026 · Gulf jobs

In Kuwait's private sector, end-of-service indemnity for a monthly-paid worker is 15 days' wage for each of the first five years, then one month's wage for each year after, on your last wage. The total cannot be more than one and a half years' wage. If you resign, you get nothing before 3 years and only part of it before 10 years.

This guide explains the rules in plain English, with worked examples. To work out your own figure, use the Kuwait indemnity calculator.

Who these rules apply to

The rules come from Articles 51 to 53 of Kuwait's private-sector Labour Law No. 6 of 2010. An English translation is available from the ILO: Law No. 6 of 2010 (ILO NATLEX). The Public Authority for Manpower (PAM) runs the private-sector labour law.

• Covered: private-sector workers, Kuwaiti and expat.
• Not covered: domestic workers, who have a separate law (Law No. 68 of 2015), and government staff, who follow civil service rules.
• Kuwaiti nationals in the social security scheme (PIFSS) may have parts of their indemnity handled differently. Check with your employer.

How is indemnity calculated in Kuwait?

It depends on how you are paid. Most office and professional staff are paid by the month.

Part years are paid in proportion. Six months is half a year, so it earns half of that year's rate.

daily wage = monthly wage ÷ 26
indemnity = 15 × daily wage × first 5 years + monthly wage × years after 5
capped at 18 × monthly wage
if you resign: indemnity × your share (see the table below)

26 or 30 days: how the daily wage is worked out

"15 days' wage" needs a daily wage. Article 67 says the daily wage is the monthly wage divided by the actual working days, leaving out weekly rest days. In a six-day week that is 26 days, which is the usual practice. Some employers divide by 30 instead, which makes each day worth less. The number 26 itself is practice, not a figure written in the law, so check your contract and how your employer does it.

Which salary counts? Do allowances count?

Indemnity is based on your last wage. In the law, wage means the basic wage plus what you regularly get for the work, such as allowances. So in most cases it is basic salary plus regular allowances. Some contracts say basic only. The calculator lets you split your pay and choose either.

If you resign: the Article 53 table

When you keep the full indemnity

• Your employer ends the contract, or a fixed-term contract simply finishes.
• A woman leaves within one year of marriage.
• You leave because the employer broke the contract.
• The contract ends through illness, disability or death, or because the employer goes bankrupt or closes the business (Articles 48 to 50 and 52).

Leaving after childbirth is not one of the full-indemnity cases in the law. A worker dismissed for serious misconduct under Article 41 gets no indemnity.

Worked example 1: employer ends the contract

Ahmed joined on 1 March 2018. His last working day was 30 June 2024. That is 6 years and 4 months (6.333 years). He is paid by the month: KWD 600 basic plus KWD 150 in regular allowances, so KWD 750 in all.

• Daily wage: 750 ÷ 26 = KWD 28.846
• First 5 years: 5 × 15 × 750 ÷ 26 = 56,250 ÷ 26 = KWD 2,163.462
• The 1 year and 4 months after that: 1.333 × 750 = KWD 1,000.000
• Indemnity: KWD 3,163.462, about 4.2 months of wage, well under the cap of 18 × 750 = KWD 13,500

The same service with other choices:

Worked example 2: resigning before 3 years

Fatima earns KWD 500 a month.

• She resigns after 2 years and 11 months. Her full indemnity would be KWD 841.346, but under Article 53 she gets nothing.
• If she waits until 4 years, the full indemnity is KWD 1,153.846 and she gets half: KWD 576.923.

If you are close to 3, 5 or 10 years, check the date before you resign. A few weeks can change the answer from nothing to something.

Worked example 3: long service and the cap

Ahmed's colleague has 25 years of service on KWD 750 a month. Without a cap, the sum would be KWD 2,163.462 + 20 × 750 = KWD 17,163.462. The cap is 18 × 750 = KWD 13,500, so the indemnity is KWD 13,500. On these rates the cap is reached a little after 20 years. Service beyond that adds nothing more.

A daily-paid worker with the same 25 years and the same monthly pay is capped at one year's wage: KWD 9,000.

Your final settlement: more than the indemnity

• Unused annual leave. You get 30 days of paid leave a year once you have worked 6 months (Article 70, as amended in 2017). Unused leave is paid in cash when the job ends (Article 73). For Ahmed, 30 unused days at 750 ÷ 26 is KWD 865.385. Work out yours with the Kuwait leave salary calculator.
• Notice pay. On a contract with no end date, notice is 3 months for monthly-paid workers and 1 month for others (Article 44). If you are not asked to work it, it is paid. For Ahmed, 3 months is KWD 2,250.
• Overtime still owed. Overtime is paid at the normal wage plus 25% (Article 66). Check it with the Kuwait overtime calculator.
• Minus loans or advances you still owe the employer.

If you plan to send the money home, the currency converter helps you see the amount in your home currency.

Common mistakes

• Using 15 days for every year. After year 5 the rate for monthly-paid workers is a full month, not 15 days.
• Mixing up 26 and 30. Dividing by 30 gives less. Check which one your employer uses.
• Using basic salary when allowances count. Unless your contract says basic only, regular allowances normally count.
• Using the Saudi resignation table. Kuwait's first band is 3 years, not 2, and the 3 to 5 year share is half, not one third. Compare with the Saudi end of service calculator if you have worked in both countries.
• Forgetting the cap. Long service stops adding money at 18 months' wage.
• Counting unpaid leave as service. Days of unpaid leave are taken off.
• Forgetting leave and notice pay. They are paid on top of the indemnity.

What if your employer disagrees?

1. Ask for the calculation in writing: which wage, which dates, which daily divisor (26 or 30) and which reason for leaving.
2. Compare it with your contract and your own figure from the calculator. Most differences come from the divisor, the wage, or the reason for leaving.
3. Keep your papers: contract, salary slips or bank statements, resignation or termination letter, and leave records.
4. Contact the Public Authority for Manpower (PAM) through its official channels at pam.gov.kw if you cannot agree. Do not sign a final release until you are happy with the amount.

Sources and checks

The indemnity rules on this page (Articles 41, 44, 51, 52, 53, 55 and 67 of Law No. 6 of 2010) were checked on 11 October 2026 against the English text of the law (ILO NATLEX copy). The ÷ 26 daily wage is common practice based on Article 67, not a figure written in the law. The leave and overtime figures were checked on 12 October 2026. Rules can change, so confirm with your employer or PAM before relying on a figure.

This guide explains the rules in plain English for planning. It is not legal, financial or flight-operations advice; check your contract, the official source linked above, your employer or your operator.