Indemnity/date
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I am a regular reader of the Legal Clinic column, which helps us a lot. Would you please clarify the below issue.
I joined a company on June 1, 2004 and after three years they transferred to one of its own division and they also transferred my visa to that division but the owner remained the same. They paid 3 years indemnity at that point. There was no separate contract paper on the transfer. Until now I am working in the division to which I was transferred. If I resign now, will my starting date with the company — for calculation of indemnity — be June 1, 2004 or June 1, 2007. I am working still on my contract which I received on June 1, 2004 as both the divisions belong to the same owner
Name withheld
Answer: It all depends on how you were paid (as regards your indemnity) and what your contract says on the issue. As we do not have this information we may not be able to give you a very accurate answer but we will try to be as “close as possible”.
This is your contract says you will get your indemnity “according to the Kuwait Labor Law”. If your services have been continued under the same contract and the same sponsor then your indemnity should be calculated from the day you joined the firm, i.e. June 1, 2004 but the company after calculating the indemnity for the 11 years should minus the amount it paid to you.
The company can’t get away by calculating the indemnity from June1, 2007 if your service is continuous.On the other hand, if the division you were transferred to, is a total different and independent entity —regardless of the fact it has the same sponsor — then you will be deemed to have worked for two different companies and your indemnity should be calculated only for the period that you have been with your current firm, i.e. from June 1, 2007. Now we have detailed two separate situations for you. Use the one which is applicable to you.
Please also remember that your firm can’t give you less than what is mentioned in the Labor Law even if a lesser calculation is mentioned in your contract. In such a case the calculation must be made according to the Labor Law.
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