Everything You Need To Know About Labour Law in Bahrain

Labour law in Bahrain covers all aspects related to employment and labor relations. This law covers all jurisdictions in the country and is the guide for both employers and employees. This way, the authorities ensure the duties and rights of all employment actors in this country.

In this article, we will show you the basics of Bahrain labor law with its ins and outs. Likewise, you will learn the most important aspects, such as the minimum wage, the rights and duties of employees.

Type of Employment Contract

Labour law in Bahrain

Under labour law in Bahrain, the contract is an agreement between employee and employer that must be put in writing. In Bahrain, the contract must be in Arabic; otherwise, they must attaché a copy in Arabic. Moreover, the employer must print two copies, one for the employee and the other for the employer.

Additionally, if the contract has an internal company rule, the employer will attach a copy of the regulation. Also, both parties must sign the contract.

On the other hand, according to the Bahrain law for employees, the contract must record the type of employment. This will depend on whether it is for a fixed or indefinite period.

  • Fixed-term contract. It is the one that the employer applies for a specific time or a specific job. This contract terminates automatically based on the expiration date outlined in the contract. However, both parties can renew it by mutual agreement.

The Bahrain law for employees says that the indefinite-term contract contemplates an unlimited time and can follow the next parameters:

  • In the case of a contract for an indefinite period of time.
  • If both parties establish the agreement for a period greater than 5 years.
  • If the time originally established and the renewed period is more than 5 years
  • In the case of the employee and employer continue the job after the termination of the definite-time contract without agreeing to its renewal.
  • If the labor agreement was established for a specific job and exceeded 5 years.
  • When there is a renewal of the contract and they remain within a period of execution of the original job. In this case, the employer will renew the agreement for 5 more years.
  • In case of expiration of employment agreement related to a specific job and both employee and employer continues without renewal agreement.

Working Hours and Overtime Regulations

According to labour law in Bahrain, working hours weekly are from 40 to 48 hours for 8 hours a day. However, this reduces to 6 hours a day for Muslims during Ramadan. In addition, Fridays and Saturdays are weekends, with the working week from Sunday to Thursday.

Extra hours are those that the employee works after the 8 hours established by law. In this case, for each extra hour worked, the employee must receive 25% more than the regular daily payment. In addition, in case the overtime is at night, according to the labour law in Bahrain the worker will receive the daily salary plus an additional 50%.

Minimum Wage and Salary Regulations

According to labour law in Bahrain, the salary is the same or higher paid in Western countries. However, there is no personal income tax, so income is generally higher. Consequently, the salary earned by a worker in Bahrain is considered to be one of the best benefits for workers in that country.

On the other hand, previously the salary was divided into parts that involved a basic subsidy stipulated for housing, vehicles, medical insurance, etc. However, today employers pay only a sufficient minimum wage. In addition, on various occasions, employees receive additional incentives.

In the country according to the Bahrain labour law implemented in 2022, there is no established minimum wage. However, workers with high school degrees and under the National Employment and Training Plan will receive a stipend of BHD 300 per month.

Likewise, workers with diplomas will be able to receive a monthly minimum salary of BHD 380. Likewise, university students will be able to obtain a monthly minimum of BHD 450 according to the labour law in Bahrain.

Employee leave and holidays in LMRA Bahrain labour

The LMRA Rules for employees establish that on the holiday a worker must receive 150% of the salary earned or if the employee prefers, days off. In addition, in case the holiday falls on a Friday, the employee will receive a day off in compensation.

On the other hand, the Labour law in Bahrain establishes that local and foreign workers have the same rights. However, the employer will only pay the foreign workers the vacation stipend because the locals are enrolled in the pension funds.

In the case of vacation leaves, employees will receive 30 paid vacation days per year, after completing one year of service. Also, the employee receives accumulated vacations equivalent to 2 ½ days per month. In the case of foreigners, employers may pay for air travel to the place of origin of their workers during the vacation period.

On the other hand, according to labour law Bahrain, Muslim employees get 14 days of paid leave for the pilgrimage to Mecca. However, this will depend on whether the worker has worked for the same company for 5 consecutive years.

In the case of maternity leave, women are entitled to 75 days of leave, of which 60 days are paid vacations and 15 days without pay. Likewise, paternity leave is 1 day for male workers.

Labour law in Bahrain establishes sick leave of 55 days per year with 15 days paid, 20 days half paid, and 20 days unpaid.

Employee Benefits and Social Security

Employees in Bahrain receive benefits and social security as indicate bellow:

The current contribution for social security is 7% of the employee and 12% of the employer for a total SIO of 19%. However, for foreign workers, it is 3% employer and 1% employee for a total of 4%. Likewise, the employer retains them and delivers them monthly to the SIO.

In the same way, the Ministry of Health receives BHD 22.5 for each worker of the companies in the country. Likewise, the employer pays the rate through the SIO. On the other hand, if the employer on its account provides health insurance to workers, it will not have to pay social security.

In this case, the employer can go to the Ministry of Health and request an exemption letter and present it to the SIO.

Bahrain Labor Law Compliance and Enforcement

Labour law in Bahrain

Labour law in Bahrain has in its Labor Law, provisions that must be complied with. Thus, the provisions include the right to sick leave, vacations, earned wages, and working hours. Likewise, its law establishes that a worker must receive 30 days of vacation and other limits, such as a maximum of 8 hours of work.

However, it is the employers who can modify these ordinances to benefit their workers.

Compliance and Penalties for Bahrain Labor Law Violations

Failure to comply with the labor law of the country can bring serious legal consequences and sanctions that may vary according to the nature and scope. Thus, in the case of the private sector, the fines can range from BHD 100 to BHD 500 for each affected employee. In addition, if there are repeated offenses, the fines may be higher and there may even be imprisonment.

In the same way, companies can receive fines for not providing an adequate and safe work environment. Even if employees are not properly trained, the company could be fined BHD 200 to BHD 500.

Bahrain complies with certain penalties for infringement under the LMRA Bahrain labour law, which governs the termination of a contract by an employer or employees. This will depend on the following:

Termination and resignation rules in Bahrain labor law

Termination of an employment contract by an employer is possible in the probationary period. Likewise, you can do it when the definite-time contract or dismissal notified with valid reason ends. Additionally, the employer can terminate employment if the employee does not improve performance after 60 days.

Also, the contract can terminate in the event of resignation, retirement, incapacity for work, death, or dismissal for reasons stipulated in Article 107 of the Labor Law. Similarly, a worker whose right to sick leave has not expired will be protected from dismissal for this reason.

However, if you have exhausted your 55 days of leave, you can be laid off due to illness.

On the other hand, an employee can accumulate a balance for fully or partially paid sick leave for a maximum period of 240 days. In the case of female employees, the law protects them from dismissal during marriage or maternity leave.

In the notice period, this must be no less than 30 days. However, the employer can extend this period if agrees with the employee in the employment contract.

Every employee not fired based on Article 107 must receive salary and benefits from the employer until the termination of the contract. Also, you will be entitled to payment instead of unused annual vacation.

Furthermore, if the employee is a foreigner, they must receive pay for the air flight back to their country. The latter will depend on whether the worker did not find another job in the country. You can receive a termination payment and reimbursement for unpaid business expenses.

Likewise, upon termination, employees can receive an accrued EOSG payment. This consists of half a month for each of the first 3 years of service. Additionally, 1 month of salary per year of service provided.

Hiring Foreign Workers and Visa Regulations

Under the LMRA Bahrain labour law, foreigners must obtain legal permission to receive work visas. In this case, the employer must meet the following requirements:

  • Be established in Bahrain.
  • Registered with the Labor Market Regulatory Authority (LMRA).
  • It must have a certain percentage of Bahraini workers (between 5% and 50%, depending on the industry).

Additionally, the expats need the following documents to apply for a work visa:

  • Copy of passport (valid for a minimum of six months).
  • Pre-employment medical certificate according to LMRA guidelines, showing that the employee can work.
  • Letter of offer or signed contract.
  • Copy of diploma or qualifications.
  • Copy of marriage certificate (if applicable).

In this case, the LMRA may take up to 10 business days to process the visa application. After this, the Labor Market Regulatory Authority publishes the visa status online. Likewise, each employer receives an identification number for the application for the Bahrain work permit, which you can check online on the LMRA website.

The worker must communicate to the employer if he has worked before in the country to guarantee that there has not been a duplicate on the ID. After the employee enters the country, they must undergo a medical checkup to confirm that they are in favorable conditions to work. In addition, the employee must provide a Bahrain home address to obtain the smart card.

Recent Changes and Updates in Bahrain Labor Law

In 2022, under labour law in Bahrain, the LMRA I apply a resolution on the assignment of functions to Labor Registration centers. Likewise, the functions contain the registration and notification of foreign applicants for permits and of infractions by registered applicants.

Currently, there are no changes to the Labor Law. However, the increase in remote or hybrid work and the use of technology are spreading and applied to the labor market.

Therefore, the labor laws of the country are in constant update due to the changes that may arise about this. The most important thing is that the authorities are constantly seeking to improve labor relations in the country. Thus, the government is one step ahead of all the challenges and details that arise as the work adapts to the new times.

Nevertheless, if you want to know more about labour law in Bahrain or other countries, we can provide you with such information. In the same way, count on EORMiddleast for your professional consultations and solutions in the world of work and business.

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