Kuwait Suspends 10,000 Company Files Over Unpaid Salaries
Kuwait has frozen about 10,000 company files for not paying wages and linked PAM to the Wage Protection System. What it means for workers owed salary.
KuwaitIn brief
- About 10,000 company files in Kuwait have been suspended for failing wage rules, out of 48,408 files for firms with five or more workers.
- Audits found staff at some firms unpaid for four months, and in some cases for up to 18 months.
- PAM is now linked electronically to the Central Bank's Wage Protection System, and firms must pay at least 90% of registered staff each month.
- Companies that fail lose services such as new work permits and government contract registration.
| Country | Kuwait |
|---|---|
| Organization | Public Authority for Manpower (PAM), Kuwait |
| Official source | Arab Times – 1st Deputy PM: Pay workers' salaries ✓ arabtimesonline.com |
Kuwait has suspended about 10,000 company files for failing to pay staff properly, First Deputy Prime Minister and Interior Minister Sheikh Fahad Al-Yousef told employers at a meeting on 22 October 2026. The Public Authority for Manpower (PAM) has also switched on a direct electronic link to the Wage Protection System (WPS) to catch late payers faster.
What the audits found
| Finding | Detail |
|---|---|
| Company files suspended | About 10,000 |
| Registered files (firms with 5+ staff) | 48,408 |
| Longest unpaid periods found | Four months, and up to 18 months in some cases |
| WPS compliance, July 2026 | 75.6% (up from 38.7% a year earlier) |
| WPS applications, Jan–Sep 2026 | 93,865 (up about 196%) |
The minister gave examples of abuse: a firm where 17 staff went unpaid while the owner's wife drew a salary, and a worker registered on KD 3,000 who actually received KD 180. He also criticised delivery companies running shifts of up to 18 hours.
How the new PAM–WPS link works
- The employer sends its salary file to its bank.
- The bank passes it to PAM through the WPS, which checks it against the firm's registered workers.
- Once matched, the bank pays the salaries.
- Results go back to PAM automatically.
Companies must pay salaries to at least 90% of their registered staff, and must cover all registered workers for the latest month.
Penalties for employers
Firms that fail lose access to:
- New work permits (renewals excluded)
- Registering government contracts
- Labour needs assessments
- Certificates for tenders and official approvals
- Registering company vehicles
PAM director Rabab Al-Osaimi said some firms pay salaries and then take the money back, or deduct more than 25% of pay. Both are violations, and cash salaries are banned except during a new company's first two months.
What it means for workers
- Check your bank statements. Your full salary should arrive by bank transfer every month.
- Never hand money back. Being asked to return part of your salary is illegal.
- Visit PAM. The minister told PAM to open its doors to the public one day a week, from 8am to 1pm.
- Keep records. Payslips, contracts and transfer slips help if you need to file a complaint.
Kuwait is also looking at other labour reforms, including a cap on how many workers from one nationality a firm can hire. For your rights on leave and indemnity, see our Kuwait labour law guide.
Frequently asked questions
Why did Kuwait suspend 10,000 company files?
Because the companies did not meet wage payment requirements, including paying registered workers on time through the Wage Protection System.
What is the new PAM salary system in Kuwait?
An electronic link between PAM and the Central Bank of Kuwait's Wage Protection System that checks salary files against registered staff before banks pay them.
Can Kuwait employers pay salaries in cash?
No. PAM says cash salary payments are not allowed, apart from a two-month exception for new companies.
What happens to a company that does not pay salaries in Kuwait?
Its file can be suspended, blocking new work permits, government contract registration, labour needs assessments, certificates and vehicle registration.
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