Compensation for Employment Contract Termination in Bahrain

An employment contract in Bahrain may be terminated, but in some cases, the termination may entitle the affected party to compensation. So, what is Compensation for Employment Contract Termination in Bahrain? When does terminating an employment contract create a legal right to compensation? This article explains the main rules and situations involved.

Have you been dismissed unfairly and are concerned about losing your employment rights or end-of-service benefits? Do not leave your financial entitlements uncertain.

Consult a Labour Lawyer NowOr read the guide below to understand when dismissal may be considered unfair.

Compensation for Employment Contract Termination in Bahrain

If an employment contract is terminated without a justified reason or in violation of the rules and legal requirements governing termination, the dismissal may be considered unfair and may give rise to a right to compensation.

The Bahraini Labour Law, particularly Article 104, identifies specific circumstances in which the termination of an employee may be regarded as unfair and may therefore require compensation. These circumstances include:

1. An employer’s termination of an employment contract may be considered unfair if it is based on the employee’s colour, sex, religion, marital status, beliefs, or family responsibilities. The same applies where a female employee is dismissed because of pregnancy, childbirth, or breastfeeding.
2. The employee’s membership in a trade union or lawful participation in its activities in accordance with applicable laws and regulations.
3. Submitting a report or complaint, or filing a legal claim against the employer, unless the complaint, report, or claim is malicious.
4. Exercising the employee’s statutory right to leave under the provisions of the Labour Law.
5. The attachment of amounts or employment entitlements owed to the employee and held by the employer.

To help protect against circumstances that may lead to unfair dismissal, employees should consider the following:

1. Understand your employment rights and the protections provided by the Labour Law. Employees should also keep informed of any amendments that may affect the relevant legal provisions.
2. Make sure you comply with the procedures and internal policies of the company or establishment, particularly any specific rules governing disciplinary action or dismissal.
3. Keep proper records of your work performance and, where possible, obtain regular performance evaluations from the employer. These records may become important evidence if a dispute arises.
4. If a workplace problem or concern develops, discuss it clearly and directly with the employer where appropriate in an effort to resolve the issue before it develops into a formal dispute.

If you have been treated unfairly when your employment contract was terminated, or if you are an employer who has suffered damage because of an employee’s conduct, you may seek advice from a lawyer in Bahrain experienced in labour law to understand your legal position and the available options.

Cases Where an Employer May Terminate an Employment Contract Without Compensation

Under Bahraini Labour Law, an employer may terminate an employee’s employment contract without compensation in certain circumstances. The main cases include:

1. If the employee assumes a false identity or submits forged certificates or recommendations.
2. If the employee commits an act that causes substantial financial loss to the employer.
3. If the employee fails to follow instructions concerning the safety of workers or the workplace despite receiving a written warning.
4. If the employee is absent from work without a lawful or justified reason.
5. If the employee fails to perform essential obligations agreed upon in the employment contract.
6. If the employee discloses confidential business information without written authorization from the employer.
7. If a final judgment is issued against the employee for a misdemeanor or felony involving dishonesty, honour, or public morals.
8. If the employee is clearly intoxicated or under the influence of narcotic substances during working hours, or commits an indecent act at the workplace.
9. If the employee assaults the employer, another employee, or one of the establishment’s customers during work or because of work.
10. If the employee fails to comply with the legal rules governing the exercise of the right to strike.

Frequently Asked Questions About Compensation for Employment Contract Termination

Some of the most common questions include:

This concludes our article on Compensation for Employment Contract Termination in Bahrain, in which we explained the main circumstances associated with terminating employment contracts in Bahrain, when an employee may be entitled to compensation, and when an employer may be permitted to terminate a contract without compensation.

You may also read about the Defenses in a Compensation Claim in Bahrain.

Lawyer Abdulrahman Khalifa

A Bahraini lawyer and the founder of a legal consultancy firm established in February 2019. He holds a Higher Degree in Sharia and Law from Al-Azhar University. He has extensive experience in court representation and providing legal advice in criminal, personal status, civil, and commercial matters. He is known for delivering clear, practical, and effective legal advice aimed at protecting his clients’ rights and interests, and has achieved tangible results in notable cases, including commercial litigation and inheritance matters