Bahrain Gratuity Calculator (end of service, 2026)
Bahrain end-of-service benefit for non-Bahraini private-sector workers = half a month's wage for each of the first 3 years and one month's wage for each year after, with part years pro rata. Since 1 March 2024 the employer pays monthly contributions (4.2%, then 8.4% of wage) to the Social Insurance Organization, and the SIO pays the benefit when service ends.
· Calculated with AiStaffo
The rules in Bahrain
| Law | Labour Law for the Private Sector (Law No. 36 of 2012); SIO Decision No. 109 of 2023 on end-of-service remuneration for non-Bahrainis (in force 1 March 2024) |
|---|---|
| Who is covered | Non-Bahraini private-sector workers on an employment contract, whatever the contract type or wage. Bahrainis and other GCC nationals are covered by the social insurance pension instead |
| Wage used | Last contractual wage paid periodically, plus increases and social allowances |
| Amount | Half a month's wage per year for the first 3 years; one month's wage per year after that |
| Part years | Paid in proportion to the time served |
| Who pays | Service from 1 March 2024: the SIO, from the employer's monthly contributions. Service before that date: the employer, under the Labour Law |
| Employer contribution | 4.2% of monthly wage for the first 3 years of service, 8.4% after (8.4% from the start for workers who already had 3 years by March 2024) |
| Maximum | The SIO benefit is capped at the total contributions paid for the worker; the employer must pay any shortfall in contributions |
| Resignation | No reduction in the formula |
Worked example
Monthly wage BHD 1,000 (basic + social allowances), 6 years of service.
First 3 years: 0.5 × 1,000 × 3 = BHD 1,500. Next 3 years: 1,000 × 3 = BHD 3,000. Total BHD 4,500. If 2 of those years were before March 2024, the employer owes the gratuity for that period and the SIO pays for the rest; the total formula is the same.
What changed in March 2024
Before 1 March 2024 the employer paid the whole gratuity in cash when the job ended. Now the employer pays a monthly contribution for each expatriate worker to the Social Insurance Organization (SIO): 4.2% of wage for the first three years and 8.4% after. When service ends, the worker claims the benefit from the SIO. The benefit is still worked out on the last wage with the same half-month and one-month rates, so the calculator gives the same figure under both systems.
If an employer under-reported the wage or missed contributions, it remains liable for the gap, and late contributions carry penalties under the Social Insurance Law.
Bahraini employees
Bahraini nationals are not paid this benefit. They are insured by the SIO for old-age pension, and the end-of-service fund covers non-Bahraini workers only.
For employers: gratuity is one line of what a role costs
Gratuity, leave, statutory contributions and notice periods all sit on top of salary. Routine back-office roles such as data entry, follow-ups, reconciliations and reporting can be handed to AI workers that carry none of these costs. Book a free automation audit and we will put your own figures on it.
Please note: this calculator follows the published law and common practice as checked on 21 October 2026. It is a guide, not legal advice. Contracts can give more than the legal minimum, and special cases (part-time work, free zones, disputes) can change the figure, so confirm the final amount with your HR team or a lawyer before paying or accepting a settlement.
Sources
Questions people ask
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