Onboarding employees in Bahrain will require employers to have knowledge of employment laws, statutory regulations, benefits, leaves, and allowances. This section will have the necessary information on the items previously mentioned.
Employee Contract
Public and Provincial Holidays
Leave Information
Basic
The employment contract must be written in Arabic and must have two copies – One for the employer and one for the employee. A translated copy must be attached if the contract is written in another language. The contract must contain the following details:
- Employers’ name, company address, and trade registration number.
- Employees’ names, birth dates, nationality, occupation, qualifications, residential addresses, and personal identification documents.
- Nature, type, and duration of job contract.
- Wage, mode of payment, and benefits.
Probation Period
The probation period for Bharanian employees does not exceed 3 months. A probationary period can be increased to 6 months in certain types of jobs.
13th Month Pay
Not mandatory
Employee Benefits
-
Annual Leave
-
Maternity Leave
-
Paternity Leave
The minimum wage for a Bahraini employee with a bachelor’s degree is BHD 450 (Bahraini dinars), for a diploma holder it is BHD 380, and for a secondary school employee or less, it is BHD 300.
The employees are paid 25% during the daytime; 50% during the nighttime and 150% for their weekly rest days or public holidays for the overtime work they have done. The standard working hour is 40hrs per week and 8hrs a day.
Employer Payroll Cost:
| Type of Contributions |
Contributions |
| Social Security |
16%, increasing by 1%
per year till it reaches 20% by January 2028
|
Employee Payroll Cost:
| Type of Contributions |
Contributions |
| Social Security |
8% |
Employee Income Tax
There is no personal income tax in Bahrain.
VAT
The standard rate of VAT in Bahrain is 10%.
Employment in Bahrain can be terminated both by the employee and the employer. The employer can terminate the employment on substantial grounds. If the employment is terminated without any grounds, the employer must pay a severance to the employee. See employment laws in Bahrain
The notice period in Bahrain for permanent employees and employees on probation is one day.
Severance pay
The severance pay in Bahrain as follows:
| Years of service |
Severance Pay |
| First 3 years |
15 days salary for every year |
| 4th year onwards |
30 days salary for each year |
Non-Bahraini employees must obtain a residency visa and a work visa (known as a labor card) to be employed in Bahrain.
The Labor Market Regulatory Authority (LMRA) will issue the Work Visa before an employee arrives in Bahrain and the Labor Card will be issued upon arrival. The sponsoring organization must also provide proof of work contracts and proof that the said position requires foreign expertise.