Kuwaitization Law – Labor Ratio


KUWAIT: The Ministry of Social Affairs and Labor recently issued a new Kuwaitization law that sets new ratios for national employment in the private sector. The ministry assigned a period of six months, which began in November and ended three days ago, for companies to apply the law. However, a large number of companies failed to apply the new standards in time, which prompted the ministry to stop issuing them transaction and work permits in addition to stopping the release of ratio certificates for companies that did not follow the law.

An official source said that the new ratio law for national labor in the private sector stands as follows: 60 percent for banks, 56 percent for telecommunications companies, 40 percent for marketing and investment companies, 30 percent for petrochemicals and oil refinery businesses, 30 percent for educational facilities, 65 percent for insurance companies, 15 percent for real estate companies, 13 percent for credit companies, 10 percent for Arabic private schools, five percent for English private schools, two percent for agricultural companies and two percent for manufacturing industries.

In addition, the new Kuwaitization law set ratios for Kuwaitis working in other private sector businesses, such as hotels, travel agencies, airline companies, construction companies, logistical companies, hospitals, medical centers, energy-related businesses, restaurants, social services, journalism and cooperative societies.

Furthermore, the second clause of Cabinet Resolution Number 1104 states that the governmental directories, including oil and military sectors, should not sign a contract with or place tenders on a company that has failed to abide by the new ratio law. The fifth clause of the same resolution also states that private companies that fail to abide by the new ratios must pay an annual KD 100 fine for every work permit for a non-Kuwaiti worker in the company exceeding the limit set for non-Kuwaiti workers. Expats account for nearly 95 percent of Kuwait’s private sector workforce, totaling more than 2.4 million compared with 1 million citizens.

Source : Kuwait Times