Kuwait allows up to 50% salary cuts in private sector

KUWAIT CITY -  Rapporteur of the Educational, Cultural and Guidance Affairs Committee MP Sa’adoun Hammad confirmed that the committee approved the bill about dealing with the economic impact of coronavirus on the private sector.

He disclosed the bill allows the employer to reach an agreement with some or all employees to reduce their salaries during the lockdown period by 50 percent maximum; but not lower than the minimum salary in Kuwait, while the actual work hours are taken into consideration.

The bill also allows the employer to reach an agreement with some or all employees to go on leave with pay which is equivalent to 30 percent of the salary, but not lower than the minimum salary in Kuwait.

It stipulates that the vacation or salary reduction period during lockdown is considered part of the service period with full salary in the calculation of the employees’ indemnity.

The bill mandates the employer to inform the Ministry of Social Affairs about the abovementioned agreements with the employees. The bill includes an article on the protection of Kuwaitis working in the private sector, stating that the labor subsidy granted to the employee should be increased by the same amount deducted from the salary during lockdown.

According to the bill, the Public Institution for Social Security (PIFSS) should continue paying the unemployment allowance for six months. Hammad added the bill, once approved, will be implemented retroactively starting from March 12, 2020.

He clarified the grace period for the workers to file complaints is not affected by the lockdown period, reiterating that the lockdown period is not counted.

Meanwhile, Chairman of the committee MP Dr Oudah Al-Ruwai’e said they discussed the Audio-Visual Bill; clarifying that the committee had earlier approved the articles on printing and publishing. He revealed the committee will meet on Monday in the presence of Minister of Education and Higher Education Dr Saud Al-Harbi and his team to discuss the educational electronic platform and the certificates of Bedoun graduates.

He added the committee suggested ending the academic year; along with special arrangements for secondary stage students, particularly those in grade 12. He pointed out the injustice in dealing with the situation of students in public schools compared to their counterparts in private schools as the latter already ended the academic year, while the students in public schools continue to face an uncertain future in their academic life.

Revealed
In another development, MP Muhammad Al-Dallal revealed that he sent a letter to the National Assembly about assigning the Human Resources Development Committee to submit a report on the criteria for appointing senior officials. He said the report should be completed within one month – before the current parliamentary term ends.

He explained it was discovered that those involved in major corruption cases include senior officials or that corruption occurred due to the inefficiency of some senior officials; hence, the need to follow certain criteria for the appointment of senior officials. He stressed that any senior official suspected of involvement in corruption must not remain in his position and his term must not be renewed.

He said this is the first step towards combating corruption; indicating that he is giving hints now, but next time, he will name the senior officials involved in corruption. Furthermore, Financial and Economic Affairs Committee Chairperson MP Safa’a Al-Hashem disclosed that they discussed the Public Loan Bill submitted by the government. Initially, the committee does not mind if the government obtains a loan provided it is capable of paying the loan and as long as the loan is spent properly, she said.

She pointed out the government intends to obtain KD 20 billion and then spend KD 8 billion of the loan for addressing the public budget deficit, asserting that it is unacceptable to obtain a loan for the purpose of paying other loans.

Considering the critical economic situation in the country made worse by the coronavirus crisis; Kuwait will not be able to pay the loan and this will have a negative impact on the reputation of the country and its credit rating, she warned. She revealed the public treasury has been depleted and its current balance is only KD 1 billion, indicating the finance minister ignored the recommendations of the Assembly and did not consider alternative solutions.

She said the economic catalyst procedures have not been implemented so far, while the small and medium enterprises (SMEs) are suffering too much. She added the government has been ignoring the demographic imbalance issue until an area like Jleeb Al-Shuyoukh witnessed an unprecedented population growth – 41,000 individuals per square kilometer.

She clarified the claim that the Assembly is responsible for such problems is incorrect. She went on to say that the five-year development plan – March 31, 2015 to March 31, 2020 – ended without any accomplishment although it includes economic catalyst procedures in favor of SMEs. “The government failed to cultivate seeds in times of prosperity to reap the fruits in difficult times,” she concluded.