End of Service Gratuity in Kuwait, Bahrain, and Oman: Statutory Severance Calculations Explained

Statutory Terminal Benefits Across the Northern and Central Gulf

In Kuwait, Bahrain, and the Sultanate of Oman, individual income tax is 0%. Consequently, the statutory End of Service Gratuity (EOSG) serves as the legal bedrock for expat terminal compensation.

1. Kuwait Labor Law (Article 51)

• First 5 Years of Service: 15 days of basic salary for each completed year.
• Subsequent Years: 30 days of basic salary for each year beyond year 5.
• Maximum Cap: Limited strictly to 18 months (1.5 years) of total basic wage.
• Voluntary Resignation Reductions: Employees resigning with between 3 and 5 years receive 50% of the entitlement; between 5 and 10 years receive 66.6%; full entitlement applies only after 10 years of service.

2. Bahrain Private Sector Labor Law (Article 116)

• First 3 Years: Half a month's basic salary per completed year.
• Subsequent Years: One full month's basic salary per year from the 4th year onward.

3. Sultanate of Oman Labor Law (Royal Decree 53/2023)

The reformed labor law aligns terminal gratuity across expat workers:

• One month's basic salary per completed year of continuous service.

4. Worked Example: 6 Years in Kuwait at 1,200 KWD Basic Wage

• First 5 Years: 5 × (15/30) × 1,200 KWD = 3,000 KWD
• Year 6: 1 × 1,200 KWD = 1,200 KWD
• Total Statutory Severance: 4,200 KWD (equivalent to ~€12,600 tax-free)

Calculate your exact terminal severance using our dedicated calculators:

• Kuwait End of Service Calculator
• Bahrain End of Service Indemnity Calculator
• Oman End of Service Gratuity Calculator