Bahrain WPS and SIO Payroll Guide 2026

By the ETaxFlow team · Last reviewed October 2026 · Sources: LMRA (lmra.gov.bh), SIO (sio.gov.bh)

Bahrain’s Enhanced Wage Protection System

The Wage Protection System (WPS) is run by the Labour Market Regulatory Authority (LMRA). It checks that private-sector employers pay wages on time, in full and through approved banks or payment providers, so the LMRA can see what each worker was actually paid.

The enhanced version of the system became mandatory for all private-sector employers from February 2026, building on Resolution No. 68 of 2019. Employers appoint a Wages Responsible Person to manage wage payments under the system. If wages are not paid through WPS as required, the LMRA can restrict the employer’s transactions — for example new work permits and renewals.

SIO contributions

The Social Insurance Organization (SIO) collects social insurance contributions for every private-sector employee. Contributions are worked out on the employee’s insurable wage, capped at BHD 4,000 a month, and must be paid by the 15th of the following month.

• Bahraini employees are covered by the pension, work-injury and unemployment schemes. Under the 2024 reforms, the employer’s pension contribution is rising by one percentage point a year until 2028.
• Non-Bahraini employees are covered for work injury and unemployment, and since March 2024 for end-of-service through the SIO (below).

Rates change over time, so check the current table on the SIO website before each year — and keep your payroll system’s rates in a table you can update, rather than hard-coded.

End-of-service for expatriate employees

Since 1 March 2024 (Resolution No. 109 of 2023), employers no longer simply accrue end-of-service for non-Bahraini employees and pay it on exit. Instead they pay a monthly contribution to the SIO:

The SIO then pays the benefit when the employee leaves. End-of-service that built up before March 2024 is still the employer’s liability, so keep that balance on your books until it is paid.

Monthly payroll checklist for Bahrain

1. Approve attendance, overtime and leave for the month.
2. Run payroll: salaries, allowances, deductions.
3. Calculate SIO contributions and expatriate end-of-service.
4. Pay salaries through WPS on your fixed pay date.
5. Issue payslips.
6. Post the payroll journal to your accounts.
7. Pay the SIO by the 15th of the next month.

ETaxFlow’s Bahrain WPS payroll does steps 2, 3, 5 and 6 in one run, and the HRMS handles step 1.