Aqid ERPTwo parts
- Service up to 29 February 2024: the employer pays the indemnity itself when the contract ends, under article 116 of the Labour Law.
- Service from 1 March 2024: the employer pays monthly contributions to the SIO, and the SIO pays the worker.
The monthly contribution
Paid to the SIO monthly by the employer alone, with nothing deducted from the worker, on the basic wage plus any social allowance; other allowances are not included. Example: a monthly basic wage of BHD 800.000:
| First three years of service: 4.2 % | BHD 33.600 a month |
|---|---|
| After three years: 8.4 % | BHD 67.200 a month |
Service before March 2024
Half a month's wage for each of the first three years and a month's wage for each year after, in proportion for part of a year, at the last wage. Four years before March 2024 on BHD 800.000: 3 × 400.000 + 800.000 = BHD 2,000.000, owed by the employer when the worker leaves.
Bahraini staff
Bahrainis earn no indemnity: they are covered by the SIO pension, which has its own contributions.
How Aqid ERP handles it
Aqid ERP's payroll computes the SIO indemnity contribution each month at 4.2 % or 8.4 % by length of service, and the final settlement works out the employer's own part for service before 1 March 2024.