Arbitrary Dismissal in Kuwait: Worker Rights, Compensation and Procedures (2026)

A comprehensive legal guide to arbitrary dismissal under Kuwaiti Labour Law No. 6 of 2010, covering grounds for termination, notice periods, compensation, end-of-service gratuity, burden of proof, and Labour Court procedure.

Introduction

Arbitrary dismissal from employment ranks among the most common labour disputes before the Kuwaiti courts, and among the most distressing for a worker who finds his source of livelihood abruptly severed without legitimate cause, and at times without prior notice or written reasons. The difficulty is compounded where the worker is unaware of the entitlements the law confers upon him, or allows the procedural time limits designed to protect those entitlements to expire, so that a settled right is lost through nothing more than delay in asserting it.

In Labour Law in the Private Sector No. 6 of 2010, the Kuwaiti legislator sought to strike a careful balance between two competing interests: the employer's freedom to organise its enterprise and select those who work within it, and the protection of the worker as the weaker party to the contractual relationship. Termination of an employment contract is therefore not prohibited in itself. What the law prohibits is termination that deviates from the legitimate purpose of the right, converting the exercise of a lawful liberty into an abuse that attracts compensation.

This article provides a comprehensive and precise legal exposition of the rules governing arbitrary dismissal under Kuwaiti law: its definition and controlling criteria, its distinction from lawful termination, the cases permitting dismissal without gratuity or notice, the notice period and payment in lieu, the criteria governing assessment of compensation, end-of-service gratuity, the procedure for lodging a complaint with the competent labour authority and thereafter before the Labour Court, together with the rules on burden of proof upon which the outcome of the action so often turns.

Quick Answer

Governing legislation: Labour Law in the Private Sector No. 6 of 2010 and its amendments, the law applicable to employment relationships in the private sector in the State of Kuwait.
Governing criterion: A dismissal is arbitrary where it occurs without legitimate cause, or for a reason unconnected with the work, or with the intention of harming the worker or depriving him of an accrued entitlement.
Legal effect: Arbitrary dismissal does not nullify the termination or reinstate the worker as a general rule; it gives rise to monetary compensation assessed by the court.
Notice period: Required of whichever party terminates a contract of indefinite duration. A party in breach must pay a monetary allowance equivalent to the worker's wage for the remaining period.
End-of-service gratuity: An entitlement independent of compensation for arbitrary dismissal; neither substitutes for the other, and it is forfeited only in the exhaustive cases prescribed by law.
Jurisdiction: A complaint is first lodged with the competent administrative labour authority; where amicable settlement fails, the dispute is referred to the competent Labour Court.
Exemption from fees: Workers' claims arising under the Labour Law are exempt from court fees and are heard on an expedited basis.
Limitation: No action in respect of rights arising under the Labour Law is admissible after the lapse of one year from the date of termination of the contract — a short period that demands prompt action.

I. The Legislative Framework Governing Employment Relations in Kuwait

Labour Law in the Private Sector No. 6 of 2010 regulates the relationship between worker and employer in the private sector. It replaced the earlier labour legislation, conferring broader protection on the worker and establishing a more expeditious procedural framework for the resolution of disputes. Its provisions are characterised as protective rules of public policy, meaning that no agreement contrary to them is permissible where the departure would defeat a right conferred on the worker, while agreements more favourable to him remain valid.

A practically significant consequence follows from this mandatory character: any clause in an employment contract or in an establishment's internal regulations by which the worker waives in advance his compensation for arbitrary dismissal or his end-of-service gratuity is void absolutely and cannot be invoked against him, even where signed in his own hand, because statutory protection cannot be defeated by individual will.

Alongside this statute, the protective framework is completed by a number of supporting enactments and instruments, most notably:

Social Insurance Law No. 61 of 1976, which regulates the insurance and pension entitlements of the Kuwaiti worker — entitlements wholly independent of his claims against the employer.
Civil and Commercial Procedure Law No. 38 of 1980, the general reference for procedure, evidence, appeals, and compulsory enforcement where the Labour Law contains no special provision.
Implementing ministerial decisions issued by the competent labour authority, which set out in detail the regulation of work, leave, transfer of labour, and the conditions for establishment licences.
Internal disciplinary regulations approved by the competent authority, since no disciplinary penalty may be imposed on a worker except pursuant to an approved regulation notified to him.

Notably, the Kuwaiti legislator did not adopt annulment of the dismissal decision and reinstatement as the general remedy, but chose instead the route of monetary compensation, in deference to the principle that no one may be compelled to continue in an employment contract, and to avoid imposing an employment relationship founded upon conflict. The object of a labour action in this field is therefore not a return to the post, but reparation of the harm flowing from an unlawful termination.

II. The Concept of Arbitrary Dismissal and Its Distinction from Lawful Termination

1. Definition and Legal Nature

Arbitrary dismissal is the employer's termination of a contract of indefinite duration without a legitimate cause grounded in the requirements of the work or in fault on the worker's part, or termination for a reason unconnected with the work, or with the intention of causing harm. It is a specific application of the general doctrine of abuse of right: the employer holds an original right to terminate a contract of indefinite duration, but that right is not absolute; it is qualified by the requirement that it be exercised for a legitimate purpose.

The essential inquiry in an arbitrary dismissal action is therefore not into the fact of termination — which is permissible in principle — but into the motive for it. Where the motive is legitimate and connected with the work, abuse is negated; where it is illegitimate, extraneous to the work, or founded on an intention to cause harm, abuse is established and compensation becomes due.

2. The Most Common Forms of Arbitrary Dismissal in Practice

The legislator did not lay down a rigid exhaustive list of forms of abuse, but rather a general criterion whose application to the facts of each dispute is left to the trial judge. Among the forms most consistently treated as arbitrary in judicial practice are:

Dismissal because the worker claimed his lawful entitlements, such as arrears of wages, leave allowances, or overtime, or because he lodged a complaint against the employer with the competent authority.
Dismissal on grounds of trade union activity, membership of a labour organisation, or participation in its lawful activities.
Dismissal on grounds of sex, colour, origin, or religion, or any discriminatory consideration unconnected with professional competence.
Dismissal during the worker's illness before he has exhausted the sick leave to which he is statutorily entitled.
Retaliatory dismissal following the worker's refusal to carry out an unlawful instruction, or his refusal to sign an acknowledgement waiving his entitlements.
Constructive dismissal — practically the most serious form — where the employer drives the worker to resign by indirect means, such as substantially reducing his wage, transferring him to work markedly different from his original role, stripping him of his duties, or subjecting him to treatment that renders continuation impossible.
Dismissal without investigation in cases whose nature requires an inquiry, confrontation of the worker with the allegations, and an opportunity to answer them.

3. Lawful Termination and Its Controls

Conversely, termination is not arbitrary where it rests on a serious and legitimate cause, including:

Economic and organisational grounds: abolition of the post, contraction of activity, restructuring, or closure of the establishment — provided these grounds are genuine rather than fictitious and are not used as a cloak for targeting a particular worker. Where it is established that the establishment engaged another worker in the same post after its purported abolition, the defence is converted into an indication of abuse.
Incompetence or poor performance: provided it is evidenced by objective and progressive appraisal records, and the worker has been warned and afforded an opportunity to improve.
Commission by the worker of a gross breach falling within the cases exhaustively prescribed by law, addressed in the following section.
Expiry of the term in a fixed-term contract, which ends upon the lapse of its term without need for notice or reasons, unless expressly or impliedly renewed.

4. A Precise Distinction: Dismissal, Resignation, and Abandonment

Many workers commit a procedural error of grave consequence by signing a resignation under pressure, believing this preserves their entitlements. In truth, resignation alters the worker's legal position fundamentally: it extinguishes his right to compensation for arbitrary dismissal and reduces his end-of-service gratuity according to length of service in contracts of indefinite duration.

That effect is not, however, absolute. Where the worker establishes that the resignation was procured by duress or fraud, or that it merely gave effect to the employer's wish to terminate the relationship while avoiding its legal consequences, the court may treat it as a dismissal and attach to it the full consequences of dismissal. Herein lies the importance of never signing a document without reading it and retaining a copy.

Distinct again is abandonment of work by the worker of his own motion without notice, which is a breach that may render him liable to compensate the employer — unless the abandonment is justified by a gross breach on the employer's part, such as non-payment of wages, assault upon the worker, or assignment to work fundamentally different from that agreed. In that event the abandonment is treated as lawful termination by the worker, and he retains his entitlements in full.

III. Dismissal Without Notice and Without End-of-Service Gratuity

By way of exception, the legislator permits the employer to terminate the contract without notice and without gratuity in cases exhaustively specified, which admit neither extensive interpretation nor analogy, and each of which rests upon gross fault by the worker. The principal cases are:

Fault by the worker occasioning grave material loss to the employer, subject to notification of the incident to the competent authority within the period prescribed by law — a substantive formality whose omission forfeits the employer's right to rely on this ground.
Breach of instructions concerning the safety of work and workers, where those instructions are written and displayed in a conspicuous place.
Impersonation or submission of forged documents in order to obtain the employment.
Absence without legitimate cause for a continuous or intermittent period exceeding the limit fixed by law within a single year, following written warning to the worker.
Disclosure of the establishment's secrets where such disclosure causes it harm.
A final judgment against the worker for a felony or an offence involving honour, honesty, or public morals.
Being found in a state of manifest intoxication or under the influence of a narcotic substance during working hours.
Assault upon the employer or the responsible manager, or serious assault upon a superior during or by reason of the work.
Failure to discharge fundamental obligations arising under the employment contract.
Dismissal during the agreed probationary period, within the limits permitted by law.

Three practical observations are of particular importance here.

First: these cases constitute an exception to be construed narrowly, and the burden of establishing that they are made out rests upon the employer alone. Where he fails to prove them by serious evidence, the termination is converted into an arbitrary dismissal.

Second: forfeiture of the gratuity in these cases does not extend to the worker's remaining entitlements. He retains his arrears of wages, the balance of untaken annual leave, overtime pay, and the value of a return ticket where due, because these are consideration for work actually performed and are not penal in character.

Third: the employer's exercise of this liberty is subject to full judicial review. The court may recharacterise the conduct attributed to the worker and hold that it does not rise to the level of gross fault forfeiting the gratuity, awarding both the gratuity and compensation.

IV. The Notice Period and Payment in Lieu

1. Nature and Purpose of the Notice Period

The notice period is the interval that must elapse between notification of the intention to terminate and the actual termination of the contract. Its purpose is to afford the other party an opportunity to make arrangements: the worker to seek alternative employment, and the employer to find a replacement. It is a mutual obligation binding whichever party initiates the termination, and not a right of the worker alone.

The Kuwaiti legislator has fixed the notice period in contracts of indefinite duration at three months for a worker engaged on a monthly wage and one month for others engaged on a daily, weekly, hourly, or piece-rate basis. The worker is entitled to his full wage for the notice period where he continues to perform his work during it.

2. Payment in Lieu of Notice

Where the employer terminates without observing the notice period, or releases the worker from working during it, he must pay a monetary allowance equivalent to the worker's wage for the whole notice period or the unexpired part of it. This allowance is due by operation of law upon proof of the breach; it depends neither on proof of loss nor on proof of abuse.

A common misconception is that receiving payment in lieu of notice dispenses with any claim for arbitrary dismissal, or that acceptance of it constitutes a waiver. In truth, payment in lieu of notice and compensation for arbitrary dismissal are wholly independent entitlements, each with its own cause and conditions, and they may be combined: the first is the sanction for a breach of form, the second the sanction for deviation of a right from its proper purpose.

3. Time Off to Seek Alternative Employment

It is established practice that during the notice period the worker is entitled to absent himself for part of the time to seek new employment as regulated by law, without this being treated as absence or breach. Nor may the employer use the notice period as a means of pressuring the worker or imposing unaccustomed burdens upon him; to do so is itself a further indication of abuse.

V. Compensation for Arbitrary Dismissal and the Criteria for Its Assessment

1. Basis and Nature of the Compensation

Once the court is satisfied that the termination was arbitrary, it awards the worker fair compensation assessed in the light of the circumstances of the case. This compensation is dual in nature: it repairs the material harm consisting in the interruption of the worker's livelihood and his period out of work, and the moral harm consisting in the injury to his professional reputation and the anxiety and hardship he has suffered.

Entitlement does not require the worker to prove the employer's intention to cause harm by direct evidence — practically an impossible task. It suffices that he establish that the termination occurred without legitimate cause, or that the cause relied upon is fictitious or lacking in seriousness, for the indication of abuse to arise.

2. The Criteria Guiding the Court's Assessment

Assessment of compensation is a question of fact within the exclusive province of the trial court. Judicial practice has nonetheless settled upon a set of criteria on which the reasoning of the judgment is built, chief among them:

The worker's length of service with the employer: the longer the service, the greater the harm flowing from dismissal, given the worker's attachment to the enterprise and the difficulty of rebuilding a career.
The amount of the final wage, inclusive of fixed allowances and periodic benefits forming part of the wage, rather than the basic wage alone.
The worker's age and family circumstances, the number of dependants, and the impact of loss of income on his living obligations.
The circumstances of the dismissal: its suddenness, whether it occurred in front of colleagues, whether it was accompanied by unproven allegations, or whether the worker was barred from entering the premises — all of which aggravate the award.
The length of the worker's unemployment after dismissal and the difficulty of obtaining an alternative position in the market, particularly in narrow specialisms.
The employer's conduct after termination: withholding an experience certificate, obstructing transfer of residency or of the work permit, or recording the worker as absconding without foundation.
The gravity of the breach and whether the employer conducted any investigation before dismissing.

Judicial practice in Kuwait has settled upon assessing compensation for arbitrary dismissal at an amount equivalent to the worker's wage over a reasonable period, varying with the foregoing circumstances, without this constituting a rigid arithmetical rule binding the court. It follows that the quality of the statement of claim and the documentation of the elements of loss bears directly upon the sum awarded — which is why instructing specialised counsel has a tangible practical effect rather than being a mere formality.

3. Claims to Be Joined with the Compensation in the Same Action

A recurrent error is for the worker to confine his claims to compensation alone, thereby forfeiting settled entitlements that could have been claimed in the same proceedings. The heads of claim best pursued together are:

End-of-service gratuity for the whole period of service.
Payment in lieu of notice where notice was not given or not paid.
Compensation for arbitrary dismissal.
Arrears of wages for the period preceding termination.
Payment for accrued and untaken annual leave.
Overtime pay and payment for public holidays and weekly rest days worked.
A return air ticket for the expatriate worker where the conditions of entitlement are satisfied.
An experience certificate and delivery of the worker's documents held by the employer, refusal of which is a fault sounding in damages.

4. End-of-Service Gratuity: An Independent Right Not Forfeited by Dismissal

End-of-service gratuity is a sum due to the worker upon termination of the employment relationship in consideration of the period he has served the employer. In legal character it is closer to deferred wages than to a gift or bounty. It is therefore a settled entitlement not dependent on the employer's goodwill, and it cannot be forfeited save in the exhaustive cases set out above.

The gratuity is calculated on the basis of the worker's final wage, inclusive of fixed wage components, as follows:

For a worker engaged on a monthly wage: fifteen days' wage for each of the first five years of service, and one full month's wage for each subsequent year, provided the aggregate does not exceed one and a half years' wage.
For a worker engaged on a daily, weekly, hourly, or piece-rate basis: ten days' wage for each of the first five years, and fifteen days' wage for each subsequent year, provided the aggregate does not exceed one year's wage.
Fractions of a year: the worker is entitled to gratuity for parts of a year in proportion to the period served, so that the final incomplete year is not lost.

Where the worker resigns from a contract of indefinite duration, the legislator has provided for a graduated entitlement according to length of service: a worker with less than three years' service is entitled to half the gratuity; one with three but less than five years to two thirds; and one with five years or more to the whole. This graduation is among the principal practical reasons why signing a resignation under pressure represents a double loss for the worker.

A frequently confused point is that, for a worker subject to the social insurance scheme, there is deducted from the gratuity payable by the employer an amount corresponding to the employer's share of contributions, in accordance with the statutory arrangement. This is a lawful deduction rather than a diminution of the right, and its application differs as between Kuwaiti and expatriate workers, requiring each case to be examined on its own facts.

VI. Settled Principles of the Kuwait Court of Cassation

Through its consistent rulings in labour disputes, the Kuwait Court of Cassation has established a body of principles that today constitute the governing practical rules in arbitrary dismissal actions. The most prominent settled principles include:

Freedom to terminate, qualified by the prohibition of abuse: It is settled in the jurisprudence of the Court of Cassation that the employer has the right to terminate a contract of indefinite duration, but that this right is qualified by the requirement that it not be exercised abusively. Where termination occurs without legitimate cause or for a reason unconnected with the work, abuse is established and compensation is due.
Fictitious cause: Judicial practice permits the court to investigate the true reason relied upon by the employer, so that it is not bound by what is stated in the letter of dismissal, and may infer from the circumstances and documents of the case that the stated reason is a pretext masking an illegitimate motive.
Independence of labour entitlements: It is settled that end-of-service gratuity, payment in lieu of notice, and compensation for arbitrary dismissal are independent entitlements, each with its own cause and basis, so that an award of one does not dispense with an award of another, and receipt of one is not a waiver of the others.
Discretion of the trial court: Whether abuse is made out, and the quantum of compensation, are questions of fact within the exclusive province of the trial court, not subject to review by the Court of Cassation where the ruling rests on sound reasoning grounded in the record and sufficient to support the conclusion reached.
Nullity of advance waiver: It is settled that the provisions of the Labour Law are protective and mandatory, and that any agreement or acknowledgement by which the worker waives a right conferred by the law is void, even if made after the right accrued, where it operates to defeat that right.
Narrow scope of the cases forfeiting gratuity: It is settled that the cases in which the law permits dismissal without gratuity are exhaustive, admitting neither extensive interpretation nor analogy, and that the burden of establishing their conditions rests upon the employer.
Regard to the composite wage: Judicial practice has settled that entitlements are calculated by reference to the final wage with all its fixed components paid to the worker on a regular and continuing basis, and not by reference to the basic wage stated in the contract alone, where it is established that his actual remuneration exceeds it.

Methodological note: The principles set out above are settled principles applied in judicial practice in the State of Kuwait. Reference should always be made to the specific judgment relevant to the facts of each dispute, since the application of a principle varies with the facts, the evidence, and the circumstances of each employment relationship.

VII. Practical Procedure for Pursuing Entitlements

Step-by-Step Procedural Path

Step one — documentation above all: Before leaving the workplace, the worker is advised to gather copies of the employment contract, payslips, the dismissal letter or any correspondence evidencing termination, and the emails and messages exchanged. A labour action is won on documents, not on bare assertions.
Step two — complaint to the competent administrative labour authority: The worker lodges a complaint with the labour department competent for the area in which the employer's premises are situated, setting out his particulars, those of the establishment, and his claims. This stage is mandatory as a general rule; an action is inadmissible before the court until it has been followed.
Step three — attempted amicable settlement: The department summons the parties and seeks a settlement within the prescribed period. Where settlement is achieved, a minute is drawn up constituting an enforceable instrument; where it fails, the file passes to the next stage.
Step four — referral to court: Upon failure of settlement, the department refers the dispute to the competent Labour Court within the period fixed by law, accompanied by a memorandum summarising the dispute, the parties' contentions, and the department's observations.
Step five — hearing of the action: Labour actions are heard on an expedited basis and are exempt from court fees. The parties exchange memoranda and documents, and the court may appoint an accounting expert to compute entitlements where the issues in dispute require it.
Step six — judgment and appeals: A reasoned judgment is issued, subject to appeal and thereafter to cassation in accordance with the applicable rules and time limits.
Step seven — enforcement: Once the judgment becomes enforceable, an application is made to the Enforcement Department, and attachment may be levied against the debtor's assets and bank balances.

Documents Required in Practice

The original employment contract and any subsequent annexes or amendments.
The letter of termination or dismissal, or evidence of the fact of termination where none was given in writing.
Payslips or bank statements evidencing the regularity and true amount of the wage.
Evidence of the actual period of service, such as a certificate from the competent authority, the social insurance record, or the work permit.
Evidence of leave balances and overtime, such as attendance records and correspondence.
Civil identification, passport, and work permit in the case of an expatriate worker.
Any document supporting the allegation of abuse, such as correspondence preceding the dismissal, a complaint lodged beforehand, or earlier favourable performance appraisals.

A Critical Observation on Time Limits

It must be borne in mind that no action in respect of rights arising under the Labour Law is admissible after the lapse of one year from the date of termination of the employment contract. This is a very short period by comparison with limitation periods in civil transactions, its purpose being the stability of legal positions. Delay in lodging a complaint in reliance on promises of amicable settlement is accordingly among the most frequent causes of the practical loss of labour entitlements.

VIII. The Burden of Proof in an Arbitrary Dismissal Action

The burden of proof is the key to the outcome in this class of action, and disputes are frequently determined by it before the merits are reached. The governing rules may be summarised as follows:

The worker need prove only two matters: the existence of the employment relationship, and the fact that it was terminated by the employer's will. He may prove both by all means of proof, including oral testimony and presumptions, since an employment relationship is a material fact rather than a legal act.
The employer must prove the legitimacy of the cause of termination. Once the fact of dismissal is established, the burden shifts to him to adduce evidence that the termination rested on a serious and legitimate cause. If he fails, or advances a cause shown to be fictitious, the indication of abuse arises.
The employer also bears the burden of proving discharge of the worker's entitlements to wages, gratuity, and allowances, since his liability is presumed until he proves release; a bare assertion of cash payment without documentary support does not suffice.
A party relying on one of the cases permitting dismissal without gratuity must establish both its substantive and its formal conditions, including the warning or notification procedures the law attaches to several of them.
A worker alleging that his resignation was procured by duress must adduce evidence of it, since documents are presumed valid — hence the danger of signing unread documents or blank pages.

Practical measures that strengthen the worker's evidential position include: retaining electronic copies of correspondence; serving a formal notice through a process server when the dispute arises; obtaining an official statement of the period of service and wage from the competent authorities; and declining to sign any final settlement before it has been reviewed by legal counsel.

IX. Practical Analysis and Hypothetical Scenarios

Scenario One: Dismissal Following a Claim for Entitlements

Hypothetical facts: A worker with seven years' service in a commercial establishment claims in writing for unpaid overtime. Two weeks later he receives a letter terminating his services "for want of need for his post". It subsequently emerges that the establishment engaged another worker in the same post.

Legal characterisation: The stated cause — abolition of the post — appears legitimate on its face, but the engagement of a replacement in the same post destroys that cause and exposes it as fictitious. This is coupled with a powerful temporal indication: the dismissal followed immediately upon the claim for an entitlement. The court may accordingly conclude that abuse is established and award the worker end-of-service gratuity for seven years, payment in lieu of notice, compensation for arbitrary dismissal, and overtime pay where proved.

Scenario Two: Dismissal for Absence Without Completing the Formalities

Hypothetical facts: A worker is absent on several separate days for health reasons and informs his line manager by telephone. The employer issues a decision dismissing him without gratuity on grounds of absence, with no written warning and no investigation.

Legal characterisation: Absence without legitimate cause is one of the cases permitting dismissal without gratuity, but it is conditional on two matters: that the absence reaches the threshold fixed by law, and that the prescribed formalities, including written warning, are observed. As the employer departed from these, and as the absence was attended by a medical excuse capable of documentary proof, the dismissal is converted into a termination without justification. The worker is entitled to his gratuity in full, together with payment in lieu of notice and compensation, since an exception is not made out unless its conditions are complete.

Scenario Three: Constructive Dismissal by Wage Reduction and Transfer

Hypothetical facts: A worker holding a supervisory post is confronted with a decision transferring him to a lower operational role and reducing his wage substantially. He refuses to continue and leaves, then brings proceedings claiming his full entitlements as a dismissed worker.

Legal characterisation: A fundamental unilateral variation of the terms of the contract by the employer — whether by substantial reduction of the wage or by a marked change in the nature of the work affecting the worker's position — amounts in substance to an implied termination by the employer. The worker's departure in such circumstances is therefore not a resignation but is treated as a dismissal, and he is entitled to his full entitlements including compensation, provided he proves the fact and extent of the variation by serious documentary evidence and objects to it in writing promptly upon becoming aware of it, so that prolonged silence is not construed as implied acceptance.

X. Comparative Table — Arbitrary Dismissal, Lawful Termination, and Resignation

Arbitrary dismissal: Substance — termination by the employer's will without legitimate cause or for a reason extraneous to the work. Effect — entitlement to full end-of-service gratuity, payment in lieu of notice, and compensation for abuse. Burden of proof — on the employer to establish the legitimacy of the cause.
Lawful termination: Substance — termination by the employer's will on a serious cause connected with the work, or on one of the exhaustively defined cases of gross fault. Effect — gratuity and payment in lieu of notice remain due where the ground is economic or organisational; both are forfeited in the exhaustive cases of gross fault, without forfeiture of the remaining entitlements. Burden of proof — likewise on the employer.
Resignation: Substance — termination by the worker's unilateral will. Effect — no compensation for arbitrary dismissal and no payment in lieu of notice for the worker; gratuity due on a graduated scale according to length of service in contracts of indefinite duration. Burden of proof — on the worker where he alleges duress or constructive dismissal.

Conflating these three positions is the foremost cause of lost entitlements in labour disputes. Many workers assume that leaving in protest preserves the position of a dismissed employee; correctly, what governs is the true legal characterisation of the events, not the label attached to them, and it is for the court to apply the precise legal description to what actually occurred in the light of the evidence before it.

Frequently Asked Questions

1. What is the difference between arbitrary dismissal and unlawful dismissal?

"Unlawful dismissal" is a general description covering any termination contrary to the law or the contract. Arbitrary dismissal is a species of it, arising where termination occurs without legitimate cause, for a reason unconnected with the work, or with intent to cause harm. The practical effect is generally the same: entitlement to compensation alongside the remaining claims.

2. Is the worker reinstated if the court holds the dismissal arbitrary?

Not as a general rule. The Kuwaiti legislator adopted monetary compensation rather than reinstatement, in deference to the principle that no one may be compelled to continue in an employment relationship. The object of the action is reparation of loss, not recovery of the post.

3. Does a worker dismissed arbitrarily also receive end-of-service gratuity?

Yes, and in full. The gratuity is consideration for the period of service; the compensation is the sanction for abuse. They are independent entitlements with distinct causes, and payment of one does not discharge the other.

4. I was dismissed without prior notice — what am I entitled to?

You are entitled to payment in lieu of notice equivalent to your wage for the notice period, an entitlement independent of compensation for arbitrary dismissal and capable of being combined with it. The notice period is three months for a worker on a monthly wage and one month for others.

5. I signed a resignation under pressure — are my rights lost?

Not necessarily. If it can be shown that the resignation was procured by duress, or that it in truth gave effect to the employer's wish to terminate while avoiding the consequences, the court may treat it as a dismissal. The burden, however, rests on you, so it is essential to object in writing and gather supporting material immediately.

6. How much is compensation for arbitrary dismissal?

There is no rigid arithmetical formula. The court assesses it by reference to length of service, the amount of the wage, the circumstances of the dismissal, the worker's situation, and the length of his unemployment. It is a factual assessment within the trial court's exclusive province where supported by sound reasoning.

7. Are labour actions exempt from court fees?

Yes. Workers' claims arising under the Labour Law are exempt from court fees and are heard on an expedited basis, in order to ease the worker's position and having regard to the urgent subsistence character of his entitlements.

8. May I file directly in court without a complaint to the labour department?

The rule is that the complaint must first be lodged with the competent administrative labour authority for an attempt at amicable settlement; if that fails, the dispute is referred to the Labour Court. Bypassing this stage may render the action inadmissible.

9. Within what period must I bring my claim?

No action in respect of rights arising under the Labour Law is admissible after one year from the date of termination of the contract. The period is short, and delay in reliance on promises of settlement is among the commonest causes of lost entitlements in practice.

10. Do the rules on arbitrary dismissal differ for Kuwaiti and expatriate workers?

The Labour Law in the Private Sector applies to all in the private sector without distinction as to the substance of entitlements. There are, however, practical differences relating to the work permit, residency, the return ticket, and the social insurance scheme, all of which require case-by-case examination.

11. Do I lose my rights if I sign a final settlement?

Not absolutely. The provisions of the Labour Law are protective and mandatory, and any waiver defeating a right conferred by them is void. A settlement does, however, make your evidential position materially more difficult in practice, so no final settlement should be signed before it has been reviewed by legal counsel.

12. Is dismissal during illness arbitrary?

Dismissal on grounds of illness before the worker has exhausted his statutory sick leave is an unlawful termination attracting compensation, since the legislator has surrounded the sick worker with special protection preventing him from being deprived of his employment by reason of a temporary health condition.

Conclusion

A study of the rules governing arbitrary dismissal under Kuwaiti law reveals a balanced legislative philosophy. It does not confiscate the employer's right to organise its enterprise and terminate contracts of indefinite duration, but it refuses at the same time to allow that right to become an instrument for defeating the interests of the weaker party to the relationship. From this comes the rule of compensation for abuse, a safety valve balancing freedom of contract against protection of the worker.

In practical terms, three recurrent matters most weaken the worker's position in these disputes: delay in lodging a complaint until the one-year period is close to expiry; weak documentary evidence of the employment relationship, the true wage, and the events giving rise to the dispute; and the hasty signing of a resignation or final settlement without understanding its legal effect. Avoiding these three errors alone materially improves the worker's position.

One governing proposition should never be lost from view: a labour entitlement is rarely lost because its legal foundation is weak, but frequently because its proof is weak or its time limit has expired. Engaging specialised legal counsel from the very moment of termination — rather than after the facts have become entangled — therefore represents a genuine investment in protecting the right and shortening the life of the dispute.

Legal Disclaimer

The information contained in this article is provided for legal awareness purposes only and does not constitute legal advice or a binding legal opinion, as each case differs according to its own circumstances and facts.

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