What Are My Rights if I'm Made Redundant in Bahrain?
If you're made redundant in Bahrain due to business reorganisation, downsizing, or closure, you're entitled to at least one month's notice (or pay in lieu), an end-of-service certificate, payment for any accrued but untaken annual leave, and your gratuity, calculated as half a month's wage per year for your first three years and a full month's wage per year after that. Genuine redundancy compensation is generally set at half the amount owed for a termination without cause.
Key facts
The specifics, before the explanation.
- Minimum 1 month's notice, or compensation equal to wages for the notice period if not given
- Entitled to an end-of-service certificate documenting your employment
- Entitled to payment in lieu of any accrued but untaken annual leave
- End-of-service gratuity: half a month's wage per year for the first three years, a full month's wage per year after that (note this differs slightly from the general Article 116 formula, reflecting redundancy-specific provisions)
- Genuine redundancy compensation is generally around half the compensation owed for an unjustified termination
- Bahraini employees generally have retention priority over expatriates in equivalent roles during downsizing, under specific provisions
- Proposed amendments would require employers to notify the Ministry of Labour 60 days ahead of redundancy terminations and provide 3 years of audited financials to qualify for reduced redundancy compensation
What this actually means
Redundancy in Bahrain is treated as a distinct category from disciplinary termination, and the law builds in specific protections precisely because the employee did nothing wrong, the business circumstances simply changed. That's why you're still owed notice, your gratuity, and your accrued leave, even though the company frames it as an economic decision rather than a performance issue.
One protection worth knowing about explicitly: local Bahraini employees are generally meant to be retained ahead of expatriates with comparable competence and experience when a company is downsizing, a provision aimed at cushioning nationals during economic contractions. If you're an expatriate in a redundancy round, this is part of why your specific position (rather than a blanket "last in, first out" rule) can factor into the decision.
Proposed amendments around a 60-day Ministry of Labour notification requirement and financial-disclosure obligations for employers claiming genuine redundancy are aimed at preventing companies from using "redundancy" as a cheaper way to terminate individuals who could otherwise contest an unjustified dismissal. Check whether these amendments have been finalised and are in force at the time you're reading this, since proposed changes can take time to become binding law.
What to actually do
Rules and figures move. Confirm anything time-sensitive with the official regulator before you rely on it.
- Ask for your end-of-service certificate, final leave payout, and gratuity calculation in writing before you sign anything.
- Confirm whether your termination is genuinely being classified as redundancy versus another category, since the compensation rules differ.
- If you're an expatriate and a Bahraini colleague in an equivalent role was retained instead, understand this retention-priority provision may be part of why.
- Check whether the 60-day Ministry of Labour notification and financial-disclosure amendments have taken effect, since they'd change what your employer is required to prove before treating your exit as genuine redundancy.
- Get any redundancy package reviewed by a labour lawyer or LMRA before signing, especially if you're being asked to waive further claims.
Frequently asked questions
Is redundancy compensation the same as being terminated without cause?
No, genuine redundancy compensation is generally around half the amount owed for a termination without cause, which is why it matters whether your employer can actually substantiate that the redundancy is real (business reorganisation, downsizing, closure) rather than a disguised unjustified dismissal.
Do I still get my full gratuity if I'm made redundant?
Yes, gratuity is generally owed regardless of whether termination is for redundancy, provided you meet the minimum one-year service requirement; the specific gratuity rate for redundancy cases has been described as half a month's wage per year for the first three years and a full month per year after, so confirm the exact figure applicable to your case with LMRA.
Can my employer make me redundant instead of a Bahraini colleague doing the same job?
The law includes a provision favouring retention of Bahraini nationals over expatriates of comparable competence and experience during downsizing, so this is a relevant factor if you believe you were selected for redundancy ahead of an equally qualified national colleague.
Sources
Referenced for this guide: