Bahrain Labour Law

Bahrain Labour Law, governed by Decree-Law No. 36 of 2012, regulates employment in the Kingdom, impacting GCC cross-border workers from UAE and Saudi. It mandates written contracts within 30 days of hiring, sets a 48-hour workweek with overtime pay at 125% of basic wage, and enforces end-of-service gratuity at half a month's salary per year for the first three years, then full for subsequent service. For tenants or employees in UAE firms operating in Bahrain, non-compliance risks fines up to BHD 1,000 or contract disputes under GCC arbitration norms.

Core Provisions of Bahrain Labour Law

Bahrain's Labour Law under Decree-Law No. 36 of 2012 requires employers to provide contracts specifying job role, salary, and notice periods, with probation up to three months. Article 58 limits daily work to eight hours, excluding breaks, and mandates one day off weekly, typically Friday. Termination without notice incurs penalties: for employees, up to three months' salary; for employers, full service indemnity. Gratuity calculations exclude allowances but include basic pay, capped at 18 months' salary. In UAE-GCC contexts, this aligns with Federal Decree-Law No. 33 of 2021, but Bahrain enforces stricter local hiring quotas under Resolution No. 79 of 2006, requiring 50% Bahraini nationals in private sector roles. Disputes go to the Ministry of Labour and Social Development, with appeals to civil courts within 30 days.

Common Pitfalls in Bahrain Contracts

Many UAE businesses overlook Bahrain's Article 99, prohibiting discrimination based on nationality, leading to wrongful dismissal claims worth up to six months' wages. Non-payment of end-of-service benefits, calculated at one-half month's basic salary for initial years, often triggers labour court actions with mediation first. For expatriates, visa sponsorship ties to employment, and early termination without cause voids work permits under Immigration Law No. 19 of 2003. Warnings include ignoring annual leave entitlements—21 days after one year—or maternity protections, granting 60 days paid leave per Article 28. In GCC operations, cross-reference with UAE's RERA Law No. 26 of 2007 for rental-linked employment contracts to avoid dual jurisdiction issues. Fines for violations reach BHD 500 per infraction, escalating for repeat offences.

Key Points

• • Article 58 caps workweek at 48 hours, overtime at 125% basic pay.
• • Probation period limited to three months, extendable once by agreement.
• • Gratuity: half-month salary per year for first three years of service.
• • Maternity leave: 60 days paid, with job protection under Article 28.
• • Analyse Bahrain contracts with TenderScan to spot non-compliance risks early.