Omani Labor Law

Table of Contents
Task 1..............................................................................................................................1
Question 1...................................................................................................................... 1
Question 2...................................................................................................................... 1
Question 3...................................................................................................................... 2
Question 4...................................................................................................................... 2
Question 5...................................................................................................................... 3
Task 2..............................................................................................................................3
Role of Public Authority for Social Insurance.................................................................3
Reference....................................................................................................................... 7
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Task 1

All the answers provided to the questions are under the Omani Labor Law Articles
(Manpower.gov.om., 2018):

Question 1

According to the given scenario in first question, Mayada has been on maternity leave

and her Employer demoted her without giving any sound explanation. So according to

the Labor Law Part Three Contract of Work, Article (41) “The worker may

abandon the work before termination of the contract period and retain his full

rights after giving notice to the employer of so doing in any of the following case:

If the employer does not perform his substantial obligations towards the worker

in accordance with the provisions of this law or the terms of the contract of

work”, it is also supported by Article (83) of Chapter Two of Labor Law. In the

case of Mayada she could avail she can sue the employer on the basis of above article

and get her compensation on the basis of contract infringement.

Question 2

According to the scenario given in question 2 where Maitham has already served Al

Qassim Company for a period of more than five years. Then , according to the Labor

Law, Part Three of Contract Law, Article (24) “A worker shall not be placed on

probation more than once with the same employer and the any probation period

shall be included in the period of service if the worker has successfully completed

it. In all cases the probationary period, if any, shall be specified in the contract of

service. Any one of the parties may, after a notice of not less than seven days to
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the other party, terminate the contract during the probationary period, if it

becomes clear that continuation in employment is not suitable”. In sight of the

given Article, Maitham has the leverage and he is correct about the situation that he

should be appointed upon the same designation and wages without probation.

Question 3

According to the scenario given in question 3, Salim who served the Al Suha Food

company has been a chronic absentee and he has been absent from his job for

continuous twenty days. So, according to the Labor Law Part Three, Contract of Work,

Article (40) “The employer may dismiss the worker without prior notice and

without end-of-service gratuity in case: If he absents himself from his work for

more than ten days without reasonable cause during one year or for more than

seven consecutive days provided that such dismissal shall be preceded by a

written notice to him from the employer after his absence for five days in the

first case”, so in case of the scenario Company issued Salim a termination letter

although they have the right to terminate him without any prior notice on the basis of

his conduct. However, Salim’s claim in this case is wrong and he isn’t owed any

compensation.

Question 4

According to givn scenario in question 4, Manal thinks she has been dealt unjustly so

according to the Labor law Article (11) “Article (11): The employer shall employ

the Omani workers to the maximum possible extent. The ratio of Omanis to the

foreigners in the various economic sectors or the activities covered by each sector

as may be necessitated by the circumstances of each sector or activity and the

extent of availability of the necessary Omani workers, shall be determined by a

decision of the Minister. The employer shall ensure the equality of all workers
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when the nature and conditions of their work are similar”, and Article (12) “Any

Omani who is fit and desirous to work may apply for registration of his name

with the relevant directorate and state details of his age, qualifications,

experience, preferences and the work he desires to join in addition to any other

information as may by determined by the Ministry. Such department shall

register the applications in serial number upon receipt thereof and shall give the

applicant an acknowledgement of registration in the form specified by the

Ministry”, she has the right to address the matter to Court and let Court decide for the

discriminatory conduct by the employer.

Question 5

According to the scenario given in question 5, there exists a dispute between two

employees and on one incident one employee physically harmed another. So,

according to Article (40) point 8 he could be suspended from his job instead of his

dismissal under the “If he commits an assault on the employer or the responsible

manger or if he commits a grievous assault on any of his superiors in the course

of the work, or because of it if he assaults one of his colleagues in the work place

by hitting him and as a consequence thereof sickness or delay from the work for

a period exceeding ten days ensues”. However, in the given scenario the employee

has broken the rules, but he could be let off with a fine instead of dismissal.
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Task 2

Role of Public Authority for Social Insurance

Under the Social Insurance Law that came into force on 1st July, 1991, promulgated

under Royal Decree No.72/91 provided that a public service authority should be

created under the name “Public Authority for Social Insurance” which is independent

in administration and finances (Naqvi & Al-Shihi, 2009). The law created aimed to

provide peace of mind and social protection to the dwellers of Sultanate of Oman. The

authority aims to provide insurance for work injuries, death incidents, disabilities and

occupational diseases. There is a concept of Benefits Payment in which the successors

of the deceased person or the one who has suffered from some kind of injury receives

the amount based upon some conditions. If the conditions are not met then the lump

sum amount is paid. The vision of PASI is to ensure protection for individuals,

families and society as whole which is based on the principles of social solidarity,

justice and sustainability for all. The core values of PASI are: efficiency, effectiveness,

transparency, flexibility, constructive partnership, excellent entrepreneurship and

social justice.

PASI as an Authority has come a long way in serving the people. However, the

Authority still faces great challenges and obstacles in achieving and expanding the

social insurance culture, social insurance coverage and high level of growth. Under

PASI, there are some employer’s obligations and contributions. According to the

Social Security Law, the employer is responsible for making payments on behalf of

the each relevant employee and the payment pattern of each employee must be based

upon the actual wage drawn by the employee. The employer has to contribute 11.5%
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to PASI which is based upon 10.5% of the employee’s gross salary and 1% for the

occupational injury or disease. Under PASI, the employee is compelled to pay 7% of

his gross salary to the Authority. The Authority has facilitated each company of Oman

by providing them online access to the authority (Al-Wahaibi, Al-Mukhaini, Al-Badi

& Ali, 2015). The authority holds the details about each employee and his salary.

PASI has the practice of updating the standards at the start of each year by

incrementing the employers and employees contribution by 3% from their gross

salaries. However, it is the obligation of employer to inform PASI about the latest

gross salary of the employees. It has also came into debate whether the companies in

Oman are bound to pay their part to PASI or not, so if the company has the employee

fund scheme which bestows the employees with the benefit payment more than the

PASI, then the company is not bound to pay their share to the Authority. But if the

scheme is found to be providing less than PASI, then it would be considered as a

breach of Omani Labor Law and the Social Security Law. Under the Article (7) of the

Social Security Law of PASI, the employee has one year from the date of leaving the

company to bring any issue or dispute he has with the company. During that time, the

authority would interrogate into the matter and would come up with the most suitable

decision under the shadow of Social Security Law. If the employer is found to be

defaulter in case that he doesn’t pays the contribution according to the salary pattern

of employee, or cheats in paying the end of service benefits, or doesn’t pays the

insurance contribution of some or all of his employees, delays or refuses to make the

payment, then in such cases under the Article (17) of the Social Security Law, the

employer has to pay 13.5% as a penalty to PASI from his salary. Another Article (74)

of the Social Security Law provides if the employer violates any of the provisions of

the Social Security Law, then he is compelled to pay a monetary penalty of not more
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than OMR 500 (Baddock, Lang & Srivastava, 2015). The penalty number is

multiplied according to the number of times the violation has been done and the

number of employees that are under the responsibility of the employer and he has

violated the provisions. Therefore, in the Sultanate of Oman the companies are

obliged to abide by the laws of PASI. If the company updates the salary of its

employees then it is company’s duty to inform the authority and should undertake to

pay the full subscription to the authority accordingly.

Like PASI, the Government of Bahrain have also introduced the similar initiative

called “Social Insurance Organization Services (SIO)”, under these services the

pensioners, workers and beneficiaries could calculate their average pension and

average salary for their job either in private or in public sector. SIO provides the

services to the pensioners of the private and public sector and update them about the

progress electronically. They have provided eService to their users through which

they could attain information about their registration transactions, financial

transactions and an update about their annual salaries according to their jobs through

an e-statement. The organization follows the regulations issued by the Ministry of

Finance of Bahrain. Some of the noteworthy orders that distinguish PASI from SIO

are: According to the Article 2 of Regulations of Social Insurance “The provisions of

this Law shall be applied compulsorily to all workers without discrimination as

to sex, nationality, or age, who work by virtue of an employment contract for the

benefit of one or more employers, or for the benefit of an enterprise in the

private, co-operative, or para-statal sectors and, unless otherwise provided for,

those engaged in public organizations or bodies, and also those employees and

workers in respect of whom Law No. 13 of 1975 does not apply” (Ilo.org, 2017),

and in another Article (21) it is given “A worker who is employed by more than
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one employer each employer shall have to pay separately on his behalf the full

contributions, as required by this Law and in accordance with the Ministerial

Orders made in implementation thereof, after the approval of the Board of

Directors. The total wages earned from the various employers shall be used for

the calculation of contributions and for the settlement of benefits of the insured

and that of the heirs as stipulated in this Law in accordance with the terms and

conditions prescribed by the Ministerial Orders referred to in the previous

paragraph” (Ilo.org, 2017).

These are the changes !!!!!

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Reference

Al-Wahaibi, H.A., Al-Mukhaini, E.M., Al-Badi, A.H. and Ali, S., 2015, February. A

case study of the employment of social media in government agencies in Oman.

In 2015 IEEE 8th GCC Conference & Exhibition (pp. 1-6). IEEE.

Baddock, E., Lang, P. and Srivastava, V., 2015. Size of the Public Sector. World

Bank.

Joshi, V. and Ghosal, S., 2009. Impact of foreign direct investment on employment in

Oman. In Conference of The International Journal Of Arts And Sciences. 1

(18) (pp. 34-51).

Ilo.org. (2017). [online] Available at:

https://www.ilo.org/dyn/natlex/docs/ELECTRONIC/7240/83058/F299677839/B

HR7240.pdf [Accessed 7 Aug. 2019].

Manpower.gov.om. (2018). [online] Available at:

https://www.manpower.gov.om/Portal/Englishpdf/Service/toc_en.pdf

[Accessed 2 Aug. 2019].

Naqvi, S.J. and Al-Shihi, H., 2009. M-government services initiatives in Oman. Issues

in Informing Science & Information Technology, 6.