Salaries in Kuwait are similar to or greater than in western nations. But, given the fact that there is no personal taxation in Kuwait, the net income is usually great, and this is one of the major benefits of working in Kuwait.
Earlier, the remuneration packages were split into basic salary, car allowance, housing allowance, medical coverage, education for children, and air tickets for home visits. But, now employers mostly just pay a salary to cover all these expenses, although some may include performance incentives or bonuses.
Salary payment must be through bank transfer to the employee's bank account in Kuwait.
What are the factors taken into account for salaries in Kuwait?
There are several factors to be taken into consideration for salaries, and therefore, quoting an exact amount for average salaries in Kuwait, may not be possible. Further, the salaries also vary depending on the companies chosen. There are four types of companies in Kuwait, such as the W.L.L. (with limited liability - no taxes), K.S.C (Kuwait Shareholding Company - pay zakat tax and KFAS), K.S. C. (closed) - the companies listed on Kuwait Stock Exchange (pay zakat tax, National Labour Support Tax and Kuwait Fund for Advancement of Science) and International Companies with Kuwaiti Partners (pay income tax).
Remuneration and benefits vary depending on whether you work for public sector or private sector, the size of contracts, number of employees, your work experience, age, competition in the job market, type of job, duration of contract, and sometimes your nationality.
When considering salaries, you need to take into account rent and living costs. Some firms offer good salaries than others, while some others offer better benefits or allowances such as housing, car, transport, fuel, phone etc.
Therefore, if seeking to work in Kuwait, it is better not to check for average pay scale, as there could be no definite answer. Salaries in Kuwait are not based on any pre-existing standard or average. Also, not all companies offer bonuses, although it is a requirement.
Employment contract - what to look for
Before signing an employment contract, it is also good to be aware about basic labour laws in Kuwait. The working conditions of civil servants will be governed by Labour Law for Government Employees, those in oil sector will be governed by Labour Law of Oil Sector and those employed in private businesses are governed by Labour Law of Private Sector. However, the domestic labour such as chauffeurs and maids are not covered under a particular code, and are dependent on general principles of law for protection.
On being offered a job, you will have to sign a contract or a letter of agreement, containing the terms of employment. The contract would detail your job description including responsibilities and performance standards, basic salary, job title, period of contract, and the performance measures of the company. The contract will also explain the termination conditions, including the notification period from either side for termination of contract, and the liabilities to be incurred in case of breaking the conditions of contract.
On arriving in Kuwait, formalize this document first, with an official Ministry version in Arabic, or attested to by a notary. In any case, it is better to insist on a written contract than a verbal agreement. The local labour laws are applicable as long as you are in Kuwait, irrespective of whether you sign a contract or not.
How is End-of-Service-Benefit (EOSB) calculated?
Further, the employees working under contract are sometimes offered an indemnity, in addition to their salary, at the end of contract period. The indemnity is calculated on basic salary, excluding any bonuses. The indemnity is the money that the company owes you, if you have been working in Kuwait for a long time, and several long-term employees manage to accumulate reasonable back up through indemnity. But, indemnity is different from insurance. In fact, indemnity is just an end-of-contract bonus, which, as per law, has to be paid to expatriate workers, more like a thank you note, for having served the State. It is sometimes referred to as ‘end of service benefit’. Indemnity is usually 15 days of basic pay every year of employment for the initial five years, and a month’s salary every year of employment, thereafter, provided a higher rate is provided in the employment contract.
The calculation is done based on last drawn salary. The total amount paid will not exceed one and half years’ compensation based on last basic salary.
In the event that the worker terminates the agreement, which has an indefinite term with the period of service being minimum 3 years and not more than 5 years, the worker is entitled to half of the EOSB. But, if the period of service is 5 years and less than 10 years, the worker would get two-thirds of EOSB, and if the period of service exceeds 10 years, the worker will get the entire EOSB.
Working hours and holidays
As for working hours in Kuwait, it may be anywhere between 40 to 48 hours a week, depending on the company policy. There are no differences in time, with change in season. However, during the month of Ramadan, almost all companies reduce their work hours and the timing is legally applicable to all staff, although, some companies make it applicable only to Muslims who fast during daylight hours. Friday is the holiday in Kuwait, with the other day off being either on Thursday or Saturday. However, most international companies keep Saturday as the other day off.
Working over-time and leave compensation
Working over-time is calculated as per the Kuwait Labour Law. Some companies give a lump-sum for working over-time, while others have a standard rate, and some do not approve over-time all together. All these factors depend on the contract you sign in.
The annual paid leave is 30 days. The maternity leave is 70 days, sick leave is 15 days with full pay, 10 days with 75% pay, 10 days with 50% pay and 10 days with 25% pay and 30 days without pay.
Other common employment benefits
Some of the other common benefits offered to an expatriate by employers include:
Accommodation benefits - the employer may provide an accommodation or offer rent allowance which may be adequate or inadequate.
Car - A company car may be provided, or a car allowance may be given. Some companies offer loan to purchase a car or will act as a guarantor to finance company.
School fee - The fee for local schools following foreign curriculums will vary greatly, and therefore, care should be taken to ensure that the fee, if paid by employer is adequate.
Annual Holidays - This could vary from 28 days for two years, to 42 days or more a year.
Return air fare - Check and ensure if the annual return air fare in the employment contract covers family members too.
Income Tax - Personal income is not taxed in Kuwait.
Relaxed tax rules
Most of Kuwait's government spending is financed by oil revenues. Therefore, while taxes are the main sources of government income elsewhere in the world, in Kuwait, there are no personal taxes, not even for expats. The only ones who pay income tax are foreign companies working in Kuwait. The corporate income tax rate for foreign businesses at present is a flat 15 percent. The Kuwait-owned businesses are exempted from any such taxes. There is no Value-Added Tax (VAT) either at present, although there are talks on implementing it by the year 2021.
Social Security for Expats
Kuwait has a comprehensive Social Security System that covers all Kuwaiti nationals working in Kuwait. It covers pensions, sickness benefits, disability and free public healthcare, and is financed mostly by the State.
The public social security system, however, is not accessible for expats working in Kuwait. While some employers offer corporate pension schemes for expat employees, others can continue paying into a state pension scheme and/or private pension plan in your home country while working in Kuwait.
Expats are given access to public medical care when residing in Kuwait, but, there is huge pressure on foreign companies to provide private health insurance for expatriates working in Kuwait in order to reduce burden on the public system. Plans are also on to restrict expat service hours in public hospitals and into building expat-only hospitals with higher charges.
Average salaries in Kuwait 2018-19
Based on the surveys done over the past two years by various companies, the average gross salary in Kuwait is KWD21,142 per year. Average NET salary is KD18,141. The most frequent gross salary is KD12,996. The most common education is Bachelors Degree.
Avg. monthly salary
|Human Resources Manager
|IT Project Manager
|Cleaning and Housekeeping Manager
|Vice President of Finance