Kuwait payroll and social security: salary payment, PIFSS and residence rules (2026)
In Kuwait, monthly-paid staff must be paid at least once a month and no later than seven days after the wage falls due, and an employer with five or more workers must pay wages into the workers' local bank accounts. Kuwaiti employees are insured with PIFSS: the employer pays 10% to the basic fund on salary capped at KD 1,500, plus supplementary, pension increase and unemployment shares. Expatriates pay no social security, and their residence depends on Decree-Law No. 114 of 2024.
Payroll and PIFSS in Kuwait
- Salaries banked within seven days
- PIFSS contributions for Kuwaiti staff
- Deductions within Article 59 limits
Kuwait replaces its 1959 residence law for foreigners
What happened
An Amiri decree issued Decree-Law No. 114 of 2024 on the residence of foreigners: 36 articles in seven chapters replacing Decree No. 17 of 1959. It covers entry and exit, residence permits, deportation and penalties for residency trafficking.
What it means for you
Every expatriate on a Kuwaiti payroll needs a residence permit from the Ministry of Interior under the new law. Anyone who employs or houses a foreigner bears the costs of that person's deportation or expulsion.
Dates to know
- 28 November 2024Decree-law issued
- 1 December 2024Published in Kuwait Al-Yawm, Issue 1715
Source: Amiri Diwan, State of Kuwait. We check this page every week. Last checked .
Running payroll in Kuwait means three sets of rules. The Labour Law, Law No. 6 of 2010, sets how and when wages are paid and what can be deducted. The Social Security Law, issued by Amiri Order Law No. 61 of 1976, makes PIFSS insure Kuwaiti nationals, with contributions from employer and employee. Decree-Law No. 114 of 2024 on the residence of foreigners governs the permits expatriate staff live and work under.
How often must salaries be paid in Kuwait?
Monthly-paid staff must be paid at least once a month, and other staff at least once every two weeks, in Kuwaiti currency on working days (Article 56). Payment must not be delayed more than seven days after the wage falls due.
An employer cannot move a monthly-paid employee onto another pay basis without the employee's written consent (Article 58). A wage cannot be reduced during the contract for any reason (Articles 28 and 62). If an employer closes the workplace to pressure staff, or closes it for reasons not caused by them while still wanting them to work, it must keep paying wages (Article 61).
Do Kuwaiti employers have to pay salaries through a bank?
Yes, if they employ at least five workers. Article 57, as amended by Law No. 32 of 2016, requires the employer to pay workers' entitlements into their accounts at local financial institutions. The Public Authority for Manpower may ask for copies of the transfer statements.
A Council of Ministers resolution names the financial institutions and sets the rules on charges and procedures for these accounts. The Council of Ministers may also exempt some activities from transferring expatriate workers' pay to local institutions. Breaking Article 57 can bring a fine of up to the total entitlements the employer failed to pay, and the employer must still pay them (Article 139).
What can an employer deduct from pay in Kuwait?
Loan or debt repayments to the employer are capped at 10% of the wage, with no interest (Article 59). All attachments and deductions for alimony, food, clothing and other debts, including debts to the employer, are capped at 25% of the wage, with alimony first.
Our arithmetic: on a monthly wage of KD 800, an employer can recover at most KD 80 a month towards a staff loan. Disciplinary deductions cannot exceed 5 days' pay in a month, with any excess carried to later months (Article 38). Penalty deductions go into a fund used for workers' benefit, not to the employer (Article 40).
Who pays social security in Kuwait?
Only Kuwaiti nationals are insured. PIFSS covers every Kuwaiti employee in any sector, the self-employed, Kuwaitis working in a GCC state where cover is compulsory, and Kuwaitis abroad on an optional basis. Expatriate employees are not insured with PIFSS and rely on the end-of-service indemnity instead.
The employer registers its Kuwaiti staff with PIFSS and pays monthly contributions. Because expatriates are outside PIFSS, the indemnity under Article 51 of the Labour Law is their main statutory payment on leaving.
What are the PIFSS contribution rates?
PIFSS lists the employer's share as 10% to the basic fund, capped at KD 1,500, 10% to the supplementary fund, capped at KD 1,250, 1% to the pension increase fund, capped at KD 2,750, and 0.5% for unemployment insurance, capped at KD 2,750. The employee pays 5%, 5%, 2.5% and 0.5% to the same funds.
PIFSS also lists a financial remuneration contribution of 2.5% paid by the employee only, capped at KD 1,500, for 18 years of contribution. Unemployment insurance applies to the private and oil sectors. The caps are the maximums PIFSS shows for each fund.
When are PIFSS contributions due, and what if they are late?
Contributions are payable at the start of the month after the month they cover. If that date falls on a day off or official holiday, it moves to the next working day. A default of more than ten days adds 1% a month of the overdue amount.
PIFSS describes these additional amounts as running from the date the contributions were due until the date they are paid.
How does the 2024 residence law affect employers of expatriates?
Decree-Law No. 114 of 2024 replaced the 1959 residence decree. Foreigners who want to live in Kuwait need a residence permit from the Ministry of Interior. A regular permit lasts no more than five years, and anyone who employs or houses a foreigner bears the costs of that person's deportation or expulsion.
The law has 36 articles in seven chapters. It covers entry and exit, residence permits, penalties for residency trafficking, and deportation, including detention of up to 30 days pending removal. Visitors must leave within three months unless they obtain a residence permit. It was issued on 28 November 2024 and published in Kuwait Al-Yawm Issue 1715 on 1 December 2024.
Key figures
| Detail | Value |
|---|---|
| Pay frequency and deadline, Article 56 | Monthly-paid staff at least once a month; others at least every two weeks; in Kuwaiti currency; no later than seven days after the due date. (source) |
| Bank payment, Article 57 | An employer with at least five workers pays their entitlements into accounts at local financial institutions. The Public Authority for Manpower may request copies of the transfer statements. (source) |
| Penalty for breaking Article 57, Article 139 | A fine of up to the total entitlements the employer failed to settle, on top of the duty to pay them. (source) |
| Deduction limits, Articles 38 and 59 | Loan or debt repayments to the employer: up to 10% of the wage, interest-free. All attachments and deductions for alimony and other debts: up to 25%. Disciplinary deductions: up to 5 days' pay a month. (source) |
| Who PIFSS insures | Every Kuwaiti employee in any sector, the self-employed, Kuwaitis working in a GCC state where social security is compulsory, and Kuwaitis abroad where it is optional. (source) |
| PIFSS contribution rates | Basic: employee 5%, employer 10%, maximum KD 1,500. Supplementary: 5% and 10%, maximum KD 1,250. Pension increase: 2.5% and 1%, maximum KD 2,750. Unemployment insurance (private and oil sectors): 0.5% each, maximum KD 2,750. Financial remuneration: employee 2.5%, maximum KD 1,500. (source) |
| PIFSS due date and late charge | Payable at the start of the month after the month covered. A default of more than ten days adds 1% a month on the overdue amount. (source) |
| Residence of foreigners, Decree-Law No. 114 of 2024 | 36 articles in seven chapters replacing Decree No. 17 of 1959. Regular residence of up to five years. Anyone who employs or houses a foreigner bears the costs of their deportation or expulsion. (source) |
Frequently asked questions
Can a small employer in Kuwait pay salaries in cash?
Article 57 requires bank payment from five workers upwards. Below that the bank-payment duty does not apply, but the Article 56 rules on frequency, currency and the seven-day deadline still do.
Do expatriates in Kuwait pay social security?
No. PIFSS insures Kuwaiti nationals. Expatriate employees make no PIFSS contributions and are protected by the end-of-service indemnity under the Labour Law instead.
What does an employer pay to PIFSS for a Kuwaiti employee?
PIFSS lists the employer's share as 10% to the basic fund (maximum KD 1,500), 10% to the supplementary fund (maximum KD 1,250), 1% to the pension increase fund and 0.5% for unemployment insurance (each maximum KD 2,750).
How much of a staff loan can be taken back from salary?
At most 10% of the wage each month, and the employer cannot charge interest (Article 59).
What does the 2024 residence law mean for an employer?
Expatriate staff need a residence permit from the Ministry of Interior under Decree-Law No. 114 of 2024, and an employer bears the costs if a foreign employee is deported or expelled.
Each of the six Gulf states writes its own labour law, its own end-of-service rules and its own quota for hiring citizens. When Teamed is your legal employer, we apply the right rules for the country each person works in and update your contracts, policies and payroll as the law changes, so you never have to read a statute to stay compliant.
