(New) Kuwait Labor Law

The National Assembly yesterday overwhelmingly approved at the first reading a new draft labor law in the private sector which expands rights for workers, although the current sponsorship system will remain. Forty-three MPs voted for the bill while one abstained. The second reading of the 146-article law is expected to take place in two weeks' time, but a number of amendments may be introduced.

The bill will replace the 1964 labor law which has often come under fire for favoring employers while being somewhat oppressive to workers, especially expatriates who make up about 96 percent of the 1.3 million workers in the private sector. The bill expands most of the rights for workers, including end of service indemnity, annual leave, dismissal and even public holidays, which have been increased from the current nine days to 13.

Despite this, several MPs have criticized the new bill for still favoring employers over employees, especially in a number of clauses dealing with termination of workers' services.

The new bill stipulates that all workers in the private sector, regardless of their duration of service, will get an annual leave period of 30 working days excluding public holidays, weekends and sick leave periods, if any are taken. Under the current law, workers get an annual leave period of 14 days for each of the first fiveyears and 21 working days thereafter.

The termination notice period has been increased to three months instead of the current one month for employees under monthly contracts, and one month instead of 15 days for workers employed on a daily basis.

End of service indemnity payments, meanwhile, have been altered in workers' favor. Workers are now entitled to a compensation of 15 working days pay for each of the first five years and one month's pay for each year thereafter, provided the total indemnity does not exceed their salary for an 18 month period. If the employer terminates workers' contracts, the employees are entitled to full indemnity as mentioned above.

If workers themselves choose to resign, the end of service indemnity is calculated as follows: If workers resign in the first five years of service, they will be entitled to half the indemnity. Currently, they are entitled to nothing. If the workers resign after completing five years of service and less than 10 years, they are entitled to two-thirds of the indemnity. If they resign after completing 10 years of service, they are entitled to full indemnity. Under the current law, if workers resign after completing five years of service, they are entitled to only half of this remuneration.

In addition, the new bill gives private sector employees three days of holidays for Eid Al-Fitr and four days for Eid Al-Adha, as well as declaring a public holiday for Liberation Day on February 26. These holidays are in addition to other public holidays like New Year, New Islamic Year, and other religious holidays. The total number of public holidays comes to 13 days.

The bill also gives expectant women maternity leave of 70 days without insisting, as the current legislation does, that 30 days of this should be taken prior to delivery and 40 days after delivery. Women can also apply for an additional maternity leave period of four months without pay. Employers are banned from terminating their services during these periods of leave. Under the new system, the daily period allowed for mothers to breast feed their babies has been increased from one to two hours.

Also under the new legislation, widowed Muslim women will be entitled to a bereavement leave period of four months and 10 days following their husbands' death.

Workers are also entitled to an annual pilgrimage leave of 21 days only once they have completed one year of service instead of the current three years.

Employees asked to work on public holidays, meanwhile, are to be paid at double pay rate, in addition to being given an additional day off later.

Under the bill, women cannot be asked to work between 8pm and 7am, except in health services and other professions specifically exempted by the Minister of Social Affairs and Labor.

The duration of limited period labor contracts, meanwhile, should not exceed five years and not be less than one year. Employers who terminate such contracts prematurely must compensate workers with an amount equal to the pay for the remaining duration of the contract.

If a worker does not report to work for seven consecutive days or 20 non-consecutive days within a year, his or her services can be terminated, but only after the full payment of his or her end of service indemnity.

Employers have no right to terminate the services of their staff while they are enjoying their annual leave.

Monthly pay must be paid in full in a lump sum every month and before the 7th of the next month. The bill requires the Labor Minister to issue a decision outlining a minimum wage for various categories of workers.

Sick leave periods have also been increased. Workers are now entitled to 15 days of sick leave with full pay, 10 days with 75 percent pay, 10 days with half pay, 10 days with quarter pay and 30 more days without pay. Those suffering from chronic diseases, to be specified by the minister, are exempted from these rules.

Workers can amass the annual leave to take in one bloc for a maximum of two years and can do so for more than two years if the employer agrees to it. They can also claim financial pay for the annual leave period if they don't want to take the time off.