Kuwait banks, MoJ seek unified mechanism for salary garnishment

Kuwaiti banks, in coordination with the Ministry of Justice, are working on establishing a unified banking mechanism to address challenges in implementing court-ordered salary garnishments.

According to informed sources, one proposal under consideration would exclude rent allowances, student aid, and social assistance from the amounts eligible for seizure.

Under the proposed framework, garnishment would occur only after bank loan installments are paid, with court-ordered alimony classified as the top priority, followed by debts owed to the government.

Once these obligations are settled, any remaining eligible amount could be deducted, provided the total garnishment does not exceed 50% of an employee’s permanent salary.

Among the scenarios discussed is adopting the Bahraini model, which withholds a fixed value rather than a percentage of wages.

This would allocate employees a specific living allowance—based on household averages—before the remaining salary is garnished for creditors.

Another proposal involves employers deducting garnished amounts directly and forwarding them to the Enforcement Department before depositing the balance into employees’ accounts.

The number of permanent garnishment orders in Kuwait is estimated at 35,000, with major banks handling up to 800 orders daily.

Companies, particularly SMEs, face growing difficulties as garnishments sometimes include full salary transfers before distribution to staff—risking violations of the Public Authority for Manpower’s wage payment rules.

Legal experts warn that workarounds, such as transferring salaries to other accounts, could be deemed attempts to conceal funds unless formally authorized.

Ministry of Justice officials have assured banks of full legal cooperation in resolving these operational and legal challenges.

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