Social Insurance Calculation for Private Sector Employees
Social insurance is applicable to all Gulf Cooperation Council (GCC) citizens who work in Bahrain and are paid there.
This contribution is normally paid both by the employer and the employee, but there are some exceptions to this which can be defined in the person social insurance calculation card.
For GCC private sector employees (except Bahrain):
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If no override is present, the country-specific balance, Employee Private Sector Contributory Salary Base can be used to calculate the amount.
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If balances aren't fed, you can define a formula to calculate the contributory salary at the legal employer level.
- If there's no formula defined, the contributory salary uses the value of the earnings elements that are subject to social insurance. These elements are identified through secondary classification and feed the balance Subject to Social Insurance.
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The contributory salary is set once a year in the first month of payroll processing for the employee (when a new hire), or in the first month of the year. If there's a need to correct the contributory salary that's already been set, you can use the Social Insurance Contributory Salary Adjustment component of the Employee Social Insurance Details calculation card. The contributory salary will be modified in the next, normal, payroll run.
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The contributory salary may have a monthly minimum and a monthly maximum value. This means, if the monthly social insurance income is lower than the min value, contributions are calculated on the min value. If the monthly social security income exceeds the monthly max, contributions are due just on the part up to the max.
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If the employee’s payroll relationship is terminated before the last day of the month, no contribution is deducted. If termination date is at the end of the month the full contribution is deducted.Note: If the employee’s payroll relationship terminated on or before 15th of the month then no contribution is deducted.