Bahrain
Bahrain PEO & Employer of Record
WeHG provides an International PEO and global Employer of Record service in Bahrain to companies willing to enter the Bahrain market or hire local/expat employees in this country.
Traditional approach requires establishing a subsidiary in Bahrain. However our solution allows you to start the operations in Bahrain within days hence save time and money. WeHG would hire candidates on your behalf while you maintain full operational control of their work. So legally they would be our employees, on our local payroll, 100% compliant but will work on your behalf.
Bahrain fast facts
Population, million: 1.5
Land area, sq. km: 780 km2
Capital: Manama
Local currency: Bahraini dinar (BHD)
Hiring, Negotiating and Doing Business in Bahrain
Necessity of written employment contract
Written employment contract is a must.
A contract should be drawn up in Arabic.
Bahrain Employment Contract
Types of employment agreements
It is legally required to put a strong, written employment contract in place in Bahrain, in the local language, which spells out the terms of the employee’s compensation, benefits, and termination requirements. Two copies of the contract should be created, and the employer and employee should each retain one. An offer letter and employment contract in Bahrain should always state the salary and any compensation amounts in Bahraini dinar rather than a foreign currency.
Bahrain working hours
In Bahrain, the workweek is generally 40 to 48 hours, eight hours per day, with daily hours restricted to six hours per day for Muslim workers during Ramadan. Friday and Saturday are the weekend days; the workweek runs Sunday through Thursday.
Overtime should be paid at an additional 25%.
Vacation leave in Bahrain
Employees are generally entitled to 30 days of annual paid leave after one year of service. During the first year of employment, the employee is entitled to take accrued vacation, which for all employees accrues at a rate of 2 1/2 days per month. Six days of the leave must be taken consecutively. Employers typically pay for expatriate employees’ air travel home during their vacation.
Employees are also entitled to a three day period of paid leave for marriage if they present a copy of the marriage certificate
Sick leave:
Generally, employees are entitled to 55 days of sick leave per year:
- 15 days at full pay
- 20 days at half pay
- 20 days without pay
Bahrain Maternity Leave
Women are generally entitled to 75 days of maternity leave:
- 60 days of paid leave
- 15 days of unpaid leave
Women in Bahrain are not allowed to work for 40 days after the birth of a child.
Bahrain Severance Laws
Employees in Bahrain with indefinite contracts who are terminated after three months are generally entitled to receive two days of wages for each month served, with a minimum of one month pay and a maximum of 12 months of pay, regardless of whether the termination was for cause.
Employees with fixed-term contracts are generally entitled to receive the pay they would have received for the rest of the contracted period. A different arrangement may be made if both parties agree and that agreement is at least three months’ pay or the remaining term, whichever is less.
Employees in Bahrain who are not covered by the Law on Social Insurance (GOSI) are generally entitled to an indemnity at the end of their employment contract, also known as an End of Service Gratuity. Such indemnity should be calculated at a half a month for each year of the first three years of work and a month for each of the following years.
Bahrain Tax
There is no personal income tax (PIT) regime in Bahrain. However, individuals employed by a natural person or a legal entity or an enterprise in the Kingdom of Bahrain are subject to contributions to the Social Insurance Organisation (SIO) rules in Bahrain .
The current rate of contributions to the SIO is 19% for local employees (12% employer; 7% employee) and 4% for expatriate employees (3% employer; 1% employee).
These contributions to the SIO are to be withheld by the employer and remitted to SIO on a monthly basis.
Additional Benefits in Bahrain
Housing, transportation, and utility allowances are common in Bahrain.
Bahrain Holidays
- New Years Day
- Labour Day
- Eid Al Fitr
- Eid Al-Adha
- Hijri New Year
- Ashoora
- Prophet’s Birthday
- National Day
Why Choose WeHireGlobally
WeHG takes care of all the onboarding hurdles, payroll, compensation and benefits, tax filing, and termination of employment. Our Employer of Record solution allows you to manage your overseas teams efficiently while minimizing cost and risk.
FAQ Bahrain
In Bahrain, the workweek is generally 40 to 48 hours, eight hours per day, with daily hours restricted to six hours per day for Muslim workers during Ramadan. Friday and Saturday are the weekend days; the workweek runs Sunday through Thursday.
- New Years Day
- Labour Day
- Eid Al Fitr
- Eid Al-Adha
- Hijri New Year
- Ashoora
- Prophet’s Birthday
- National Day
There is no personal income tax (PIT) regime in Bahrain. However, individuals employed by a natural person or a legal entity or an enterprise in the Kingdom of Bahrain are subject to contributions to the Social Insurance Organisation (SIO) rules in Bahrain .
The current rate of contributions to the SIO is 19% for local employees (12% employer; 7% employee) and 4% for expatriate employees (3% employer; 1% employee).
These contributions to the SIO are to be withheld by the employer and remitted to SIO on a monthly basis.