Recent geopolitical developments, including the escalation of military tensions with Iran and security incidents affecting parts of the Gulf, are beginning to create operational challenges for businesses in Bahrain and the wider region. With airspace closures and potential disruptions to supply chains and workplace operations, employers should proactively assess how best to adapt to these unfolding circumstances.
As businesses navigate this evolving landscape, ensuring the safety and well-being of employees is becoming a priority, along with ensuring compliance when addressing emerging policies related to remote work arrangements and the impact of current circumstances on potential salary adjustments.
Remote Work Arrangements
Employers should note that Bahrain Labour Law for the Private Sector (Legislative Decree No 36 of 2012) does not specifically mandate or prohibit remote work. Consequently, in the absence of specific government resolutions mandating or imposing remote work in light of the recent developments, it is left to employers and employees to mutually agree on such arrangements.
For expatriate employees, however, the situation can be more complex. Employers must ensure that all visa and work permit requirements are adhered to when implementing remote work arrangements. Non-compliance with these requirements may expose employers to regulatory issues or administrative penalties. To mitigate such risks, employers are advised to review the legal status of expatriate employees and ensure compliance with all relevant regulations in this respect.
Force Majeure: What Employers Should Know About Duties and Salary Adjustments
If an employee is ready and willing to work but cannot due to circumstances beyond the employer’s control, Article 43 of the Bahraini Labour Law provides that the employee would be entitled to half of their wage. In other words, employers are still required to pay wages, albeit half, where performance is impossible.
It is understood that this provision applies in cases of force majeure- an exceptional and unforeseeable event that makes the performance of obligations impossible. While armed conflicts or military operations may qualify as force majeure, the mere presence of regional hostilities does not automatically make this provision apply and release employers from their obligations to pay full wages. Employers must carefully assess whether the situation genuinely prevents employees from performing their duties or simply makes performance more difficult or costly before cutting wages in half.
Where this provision applies, employers should take proactive steps to mitigate risk of litigation in the future. Such steps may include engaging with employees early to discuss temporary adjustments, such as reduced hours or salary modifications. Any agreements must be documented in writing to ensure compliance with applicable regulations. Employers relying on this provision must also be prepared to demonstrate that the current situation genuinely prevents employees from working, rather than just creating operational challenges.
Taking proactive steps now can help employers manage workforce costs lawfully while avoiding disputes or penalties.
What should you do next?
Employers should review their employment contracts and workplace policies to evaluate options for implementing remote work. Employers may also consider whether Article 43 applies to their specific circumstances before taking measures related to salary adjustments.
If salary reductions or other changes to employment terms are being considered, these must be discussed with affected employees, mutually agreed upon, and documented in writing to ensure compliance and reduce the risk of disputes.
Taking proactive and well-informed steps will help employers manage workforce challenges effectively during this uncertain period.
Why this matters?
Employers who implement temporary measures without proper legal basis risk exposure to employee claims, regulatory scrutiny, and reputational harm. Understanding the scope and limitations of force majeure provisions, and ensuring compliance with wage protection requirements, is essential to managing workforce costs lawfully while maintaining employee relations during this period of uncertainty.
How Al Tamimi can help
As a leading law firm in the Middle East & North Africa Region, Al Tamimi & Company is well placed to assist you with all employment and dispute related support and queries.
Our team would be pleased to discuss how these developments may affect your business and provide tailored legal advice based on your specific circumstances. For further details or assistance, please contact the key contacts.
Key Contacts
Noor Al Rayes, Partner, Head of Litigation - Bahrain, n.alrayes@tamimi.com
Reem Altaraif, Associate, r.altaraif@tamimi.com