Oman PEO & Employer of Record

WeHG provides an International PEO and global Employer of Record service in Oman to companies willing to enter the Oman market or hire local/expat employees in this country.

Traditional approach requires establishing a subsidiary in Oman.  However our solution allows you to start the operations in Oman within days hence save time and money.  WeHG would hire candidates on your behalf while you maintain full operational control of their work. So legally they would be our employees, on our local payroll, 100% compliant but will work on your behalf. .

Oman fast facts

Population, million: 4,8
Land area: 309,500 km² 
Capital: Muscat
Local currency: Rial (OMR)

Holding a strategically important position at the mouth of the Persian Gulf, the country shares land borders with the United Arab Emirates to the northwest, Saudi Arabia to the west, and Yemen to the southwest, and shares marine borders with Iran and Pakistan. The coast is formed by the Arabian Sea on the southeast and the Gulf of Oman on the northeast. The Madha and Musandam exclaves are surrounded by the UAE on their land borders, with the Strait of Hormuz (which it shares with Iran) and Gulf of Oman forming Musandam’s coastal boundaries. Oman is an absolute monarchy.

Hiring, Negotiating and Doing Business in Oman

Necessity of written employment contract

Contracts of employment must be approved by and lodged with the Ministry of Manpower (MOM). If the contract is drafted in any language other than Arabic, it must be accompanied by an Arabic translation, approved by both parties. A contract of employment must include the:

• Employer’s name, establishment and address of the place of work.
• Employee’s name, date of birth, qualifications, job or occupation, address and nationality.
• Nature and type of work or job title and the period or term of the contract.
• Basic salary, allowances, benefits and gratuities payable to the employee, method and timing of payment.
• Period of notice to be given by a party wishing to terminate the contract.

Different forms of engagement: employment, contracting, work with private entrepreneur

• Employee/worker. 
• Independent contractor/self-employed. 

Oman Employment Contract

Types of employment agreements

Fixed Contract

Fixed contracts are legally valid for a fixed duration and are more applicable for situations where the employee is hired for projects that require a specific period of time to complete. The fixed contract automatically terminates on the date of termination or expiry date, although may be considered as renewed with the same terms of both parties continue the employment arrangement as if it were still in place.

Indefinite Contract

Indefinite or unlimited contracts are agreed to be valid for an indefinite amount of time as long as both parties are continuing the employment arrangement. There is no expiration date for the indefinite contract, where termination requires given notice and a “reasonable and fair” cause to be provided if it is termination by the employer.

Oman working hours

The Law stipulates a maximum of nine working hours per working day, or 48 hours per week. In the event that any additional hours are worked, the employee is entitled to receive overtime pay.

Vacation leave in Oman

All employees, regardless of their nationality, are entitled to an annual leave of at least 15working days with full basic salary after completion of one year of continuous service. This leave is then increased to 30 days for each subsequent year of service.

Oman Maternity Leave

Female employees are generally entitled to 50 days of paid maternity leave.

Oman Severance Laws

The employer’s right to terminate employment must be exercised according to the Labour Law and the contractual terms agreed on between the employer and employee. The Labour Law lists the statutory grounds under which an employer can terminate an employment contract at will (without paying end-of-service benefit).

In the absence of any statutory ground for termination, or other contractual term previously approved by the Ministry of Manpower (MOM) (for example, contained in a disciplinary procedure endorsed by MOM), an employee can file a compensation claim for unfair dismissal.

On a finding unfair dismissal, the labour court can order:

• Reinstatement.
• Payment of compensation of not less than three months’ gross salary.
• End of service gratuity and all other benefits stipulated by the law or the employment contract.

There is a statutory minimum 30 day notice period for termination of unlimited term contracts. There is no minimum notice period for termination of limited term contracts. The Labour Law does not provide for any statutory severance payment.

Oman Tax

No income tax is payable by either the employee or employer.

Employers and Omani employees each pay monthly social security contributions to public authority for social insurance fund (PASI) .

Under the Social Security Insurance Law, Omani employees are entitled to retirement benefit from PASI, provided the employee has contributed to the scheme for a year or more.

On termination of a contract, a foreign employee receives:

•         An end of service gratuity equivalent to 15 days’ salary for each of the first three years worked.
•         30 days’ salary for each consecutive full year worked, calculated by reference to the final basic salary.

 Employers must contribute 10.5% of wages to social security and 1% for industrial illnesses and injuries.

Employees must contribute 7% of their wages to social security.

Health Insurance Benefits in Oman

In general, employees are entitled to 10 weeks of sick leave per year. Sick leave is usually paid as follows:

• First two weeks of leave: 100% of wages
• 3rd and 4th weeks of leave: 75% of wages
• 5th and 6th weeks of leave: 50% of wages
• 7th through 10th weeks of leave: 25% of wages.

Employees are also generally entitled to annual emergency leave of six days with full pay, but no more than two days can be taken at a time.

Additional Benefits in Oman

Special Leave in Oman

Employees are also eligible for the following types of leave with full pay:

• Marriage: three days
• Death of close relative: three days
• Death of uncle or aunt: two days
• Al-Haj (pilgrimage), once and only after employment of at least one year: 15 days
• Death of a Muslim wife’s husband: 130 days
• Taking an examination: 15 days

Oman Holidays

Oman celebrates 9 national holidays:

• New Year’s Day
• Lailat Al Miraj
• Eid Al Fitr
• Renaissance Day
• Eid Al Adha
• Al Higra
• Birthday of HM Sultan Qaboos
• Oman National Day
• Milad Un Nabi

Why Choose WeHireGlobally

WeHG takes care of all the onboarding hurdles, payroll, compensation and benefits, tax filing, and termination of employment. Our Employer of Record solution allows you to manage your overseas teams efficiently while minimizing cost and risk.