If a Kuwait company refuses to pay your indemnity (end-of-service benefits), it’s important to know that the law protects your rights under the Kuwait Labor Law No. 6 of 2010 with updates through 2025.
What Is Indemnity?
Indemnity is a legally mandated payment you receive when your employment ends, whether you resign, are terminated, or the company shuts down. It recognizes your years of service and helps you transition smoothly.
Your Legal Rights
🔸 Every private-sector employee, Kuwaiti or expatriate, is entitled to indemnity.
🔸 Employers must pay indemnity according to clear rules based on your years of service and salary.
🔸 Social security contributions cannot be deducted from indemnity.
🔸 If you resign before 3 years, you may not be entitled; after that, partial or full indemnity applies.
🔸 Indemnity is capped at 18 months’ salary per labor law regulations.
Common Scenarios: When Companies Refuse to Pay Indemnity
1. Contract Termination Without Cause
Sometimes a company fires an employee with no valid reason and refuses the indemnity payout. This is a direct violation of labor law. If your contract is terminated for non-fault reasons, you are entitled to indemnity, full stop.
2. Resignation and Payout Disputes
Employees resign and are told “you’re not eligible,” or get offered a lower amount. In some cases, companies manipulate resignation rules or service years. But the law clearly protects certain resignation scenarios—especially after five or ten years of service.
3. Company Closure or Bankruptcy
If a company closes or goes bankrupt, employees sometimes get left out. Thankfully, Kuwaiti law holds business owners responsible for paying indemnity, even in the event of closure or insolvency. The payment is considered a priority debt for the employer.
What to Do If Your Company Refuses to Pay Indemnity
So, your company won’t pay. What now? Treat it like a missing paycheck—get organized and act fast.
1. Review Your Contract and Pay Slips :- Your contract spells out basic rights; pay slips are proof of salary. Gather everything.
2. Communicate Formally With Employer : - Don’t rely on verbal promises. Write an official letter, email, or notice requesting indemnity payment. Stay professional, not emotional.
3. Gather Supporting Documentation :- Hold onto any communications, warning letters, company emails, or HR notes.
4. Seek Mediation or Advice :- Check with labor union reps, friends who have faced similar issues, or a legal adviser. Friendly negotiation can solve things before taking legal steps.
5. Contact Relevant Government Authority :- In Kuwait, the Public Authority for Manpower (PAM) is the official place to register labor complaints. Their goal: settle disputes fairly.
Legal Remedies: How to File a Complaint in Kuwait
If talking to your employer doesn't work, you have the law on your side.
1. Prepare and Submit Evidence :- Get a folder ready—contracts, pay slips, notices, and all proof of employment and communication.
2. File With the Public Authority for Manpower (PAM) :- Visit your nearest labor office, fill out a complaint form, and provide your documents. Some offices allow complaints by email.
3. Attend Mediation or Hearings :- You may be called for a mediation session or hearing. Be honest, polite, and present your case clearly.
4. Possible Legal Outcomes and Timelines:- If your evidence is solid, the law sides with you. Expect mediation, sometimes formal hearings or legal proceedings. Most cases resolve within weeks or months. Appeals are possible if things go slow.
Tips for Protecting Your Indemnity Rights
Think of indemnity like your paycheck—always protect it.
1. Keep Detailed Records :- Save everything: contracts, pay slips, emails, notices, and anything your employer gives you.
2. Understand Your Contract :- Read your contract before signing and know what’s included.
3. Seek Legal Advice Early :- Consult a legal expert or labor union rep if you are unsure or sense trouble.
4. Stay Updated on Legal Changes:- Check official labor law websites or news sources each year for updates to Kuwait’s labor law.
Conclusion
Your indemnity is your right—not a favor. Companies must follow the law and honor every hour you’ve put in, every contract you’ve signed, and every year you’ve worked. If your company refuses to pay, take heart: Kuwaiti law is on your side, and justice is achievable with persistence and wise action. Keep calm, follow the proper steps, and don’t leave your hard-earned money on the table.
Many online calculators, such as Kuwait Labor Indemnity Calculator, give instant estimates. For legal support, contact labor unions or specialist lawyers. Government offices like PAM also offer free guidance.