Following our article published on 1 April 2020, the Omani government has announced several new measures to assist the private sector in navigating the effects of Covid-19.
Of particular interest are the measures announced today in relation to manpower. The manpower related measures are as follows:
1. In respect of national employees (starting from May):
(a) Forced paid leave is permissible; and
(b) In the event that the forced leave is exhausted, companies may seek to reduce working hours and reduce pay for the next three months.
2. In respect of expatriate employees (starting immediately):
(a) Forced paid leave;
(b) Reduction in pay; and
(c) Termination.
Companies wanting to reduce the wages of its national staff will have to prove that their business has been affected by the imposed restrictions.
As example, it would seem clear that companies in the tourism or hospitality industries would be able to benefit from these measures. It remains to be seen how industries which have been affected more indirectly could benefit.
Further, we are aware that many companies have already taken some or all of the steps outlined above, and it is not clear how steps taken before these measures were announced will be treated. We will provide a further update as soon as this becomes clear.
Companies are still required to notify the Ministry of Manpower with any decision to reduce wages of Omani employees. Termination of Omani employees is still not permissible. In terms of expatriate staff, we would expect that the measures may be utilised by all private sector companies in all industries affected by the measures taken by the Omani government to tackle the spread of Covid-19.
