Kuwait Indemnity Calculator with Examples

Kuwait Indemnity Calculator is the most wanted topic for workers in Kuwait. Indemnity is also known as End of Service Benefits. This Calculation is a critical step that must be completed according to Kuwaiti Labor laws when an employee leaves his job.

A huge number of foreign workers in Kuwait have no knowledge about Kuwait indemnity calculator or indemnity calculations. It is seen that sometimes workers leave the country without even getting their end of service benefits due to their poor knowledge on the subject.

According to Kuwait laws, indemnity is among the important rights that must be given to private sector employees.

The Law No. 6/2010 of the Kuwait Labour law states all the rules about indemnity. Every expatriate has the right to receive his indemnity. The indemnity always calculated according to terms listed in the Kuwait Labour law.

The staff of Kuwait Newz has made dedicated efforts on the subject of how to calculate indemnity in Kuwait. The following are the indemnity calculation rules all explained with suitable examples.

Kuwait Indemnity Calculator Rules

Indemnity is to be paid to an employee on completion of his mutual labor contract. This also applies to a case when he is terminated from the job.
For more than 3 years and up to 5 years of service, workers are entitled to a termination indemnity equivalent to 15 days Basic Salary for each complete year of service.
For more than 5 years of service, workers are entitled to a termination indemnity equivalent to 30 days Basic Salary for each complete year of service. But the total indemnity must not exceed 18 months according to Article 51 of Kuwait Laws.

Rules for Resignation Cases 

No indemnity before 3 Years

An employee who resigns from his job before completing 3 years of service is not entitled to any indemnity once he decides to resign.

50% indemnity

Any employee who resigns after working for 3 years but less than 5 years in the company is eligible for a 50% indemnity. Here 50% indemnity means calculation of indemnity on the bases of 15 days Basic Salary for each complete year of service and total indemnity will be 50% of the calculated indemnity amount.

Example of 50% indemnity

An employee resigns after serving 4 years and his last basic salary was 600 KD. Then his indemnity calculator will calculate on the data as under:
Total Service: 4 years
Last Received Basic Pay: 600 KD
For the 4 years, (SuBbtract 4 weekends from 30 days)
15 days x 4 = 60 days = 60 / 26 = 2.31 months
Indemnity amount = 2.31 x 600 = 1386 KD
For less than 5 years of service indemnity is 50% so
Total receivable indemnity =50% of 1386 KD = 693 KD

Two-Third Indemnity

Any employee who resigns after working for 5 years but less than 10 years in the company is eligible for a Two-Third indemnity. Here Two-Third indemnity means calculation of indemnity on the bases of 30 days Basic Salary for each complete year of service and total indemnity will be Two-Third of the calculated indemnity amount.

Example of Two-Third Indemnity

Here is an example of how to calculate indemnity in Kuwait for a worker with more than 5 years of service but less than years of service.
An employee resigns after serving 7 years and his last basic salary was 500 KD. Then his indemnity calculations will be as under:
Total Service: 7 years
Last Received Basic Salary: 500 KD
For the first 5 years, (Subtract 4 weekends from 30 days)
15 days x 5 = 75 days = 75 / 26 = 2.88 months
For the remaining 2 years, (Do not subtract any weekend)
30 days x 2 = 60 days= 60 / 30 = 2 months
Total period = 4.88 months
Indemnity amount = 4.88 x KD 500 = 2440 KD
For more than 5 years but less than 10 years of service indemnity is Two-Third of total calculated indemnity amount so
Total receivable indemnity =Two-Third of 2595 KD = 2/3 * 2440 = 1626.66 KD

Full indemnity

Any employee who resigns after working for 10 years in the company is eligible for a full indemnity.

A full indemnity is also given to women employees who render resignation within 6 months of marriage.

For employees who have reached their retirement age, which was disabled at work or died are given full indemnity.

Here full indemnity means calculation of indemnity on the bases of 30 days Basic Salary for each complete year of service and total indemnity will be equal to the full calculated indemnity amount. But the total indemnity must not exceed 18 months according to Article 51 of Kuwait Laws.

Example of Full indemnity

Here is an example of how to calculate indemnity in Kuwait for a worker with more than 10 years of service.
An employee resigns after serving 12 years and his last basic salary was 800 KD. Then his indemnity calculations will be as under:
Total Service: 12 years
Last Received Basic Salary: 800 KD
For the first 5 years, (Subtract 4 weekends from 30 days)
15 days x 5 = 75 days = 75 / 26 = 2.88 months
For the next 7 years, (Do not subtract any weekend)
30 days x 7 = 210 days= 210 / 30 = 7 months
Total period = 9.88 months
Indemnity amount = 9.88 x KD 800 = 7904 KD
For more than 10 years of service indemnity is full or 100% of total calculated indemnity amount so
Total receivable indemnity = 7904 KD

Rules for Termination Cases 

If the employee is terminated by his company or employer than he is eligible to get full indemnity for each service whether more than 5 years or less than 5 years.

Terminated before 5 Years

If the employee is terminated by his company or employer before completing 5 years of service than he is eligible to get full indemnity on the bases of 15 days Basic Salary for each complete year of service and he will get the full calculated indemnity amount.

Example Terminated before 5 Years

Here is an example of how to calculate indemnity in Kuwait for a worker terminated before with more than 10 years of service.
An employee is terminated after serving 4 years and his last basic salary was 400 KD. Then his indemnity calculations will be as under:
Total Service: 4 years
Last Received Basic Salary: 400 KD
For the 4 years, (Subtract 4 weekends from 30 days)
15 days x 4 = 60 days = 60 / 26 = 2.31 months
Indemnity amount = 2.31 x KD 400 = 924 KD
For termination cases, there is a full indemnity
Hence, total receivable indemnity = 924 KD

Terminated after 5 Years

If the employee is terminated by his company or employer after completing 5 years of service than he is eligible to get full indemnity on the bases of 30 days Basic Salary for each complete year of service and he will get the full calculated indemnity amount.

Example of Terminated after 5 Years

An employee resigns after serving 8 years and his last basic salary was 650 KD. Then his result of Kuwait indemnity calculator will be done as under:
Total Service: 8 years
Last Received Basic Salary: 650 KD
For the first 5 years, (Subtract 4 weekends from 30 days)
15 days x 5 = 75 days = 75 / 26 = 2.88 months
For the remaining 3 years, (Do not subtract any weekend)
30 days x 3 = 90 days= 90 / 30 = 3 months
Total period = 5.88 months
Indemnity amount = 5.88 x KD 650 = 3822 KD
For termination cases, there is a full indemnity
Hence, total receivable indemnity = 3822 KD

Rules for Workers on Daily Wages

Workers on daily wages will also get an indemnity. For those who leave the job after completing 3 years, the result of Kuwait indemnity calculator will show on the bases of 10 days wages per year while those who leave after 5 years get indemnity calculated at the rate of 15 days wages for each year of service.

Example1:
The total duration of work:  4 years
Per day wage 20 KD
If he leaves before 5 years, he gets 10 days of the wage for each year
10 days wages = 200 KD
Total indemnity = 200 x 4 = 800 KD

Example2:
The total duration of work:  6 years
Per day wage 20 KD
If he leaves after 5 years, he gets 15 days of the wage for each year
15 days wages = 300 KD
Total indemnity = 300 x 4 = 1200 KD