Company wage transfers in Oman now subject to revised compliance deadlines
Oman's Updated Wage Protection System: Enhancing Wage Transparency and Protecting Workers' Rights
Oman's Ministry of Labour has recently updated the Wage Protection System (WPS) following Ministerial Resolution No. 729/2024, in line with the labour law issued by Royal Decree No. 53/2023. The updated WPS aims to foster wage payment transparency, reduce labor disputes, and protect workers’ rights systematically in Oman's private sector.
Starting from wages of September 2025, employers must electronically transfer wages for at least 75% of their workers through banks or financial institutions regulated by the Central Bank of Oman. By November 2025, this requirement increases to at least 90%.
The updated WPS includes additional exemptions from the system. Employers do not need to use the WPS for absconding reports approved after more than 30 days, newly hired workers who have not completed 30 days of employment, and workers on unpaid leave. The WPS is also not applicable when work is suspended for reasons unrelated to the employer for over 30 days, or during labor disputes lasting more than 30 days.
The Ministry of Labour emphasizes strict compliance with these requirements, with delays or discrepancies in wage payments leading to inspection visits and potential violations under Ministry regulations. Non-compliance may result in fines, suspension of government services for the employer, and legal prosecution. Workers whose employers fail to pay wages on time can transfer their services to other employers even if work permits are valid.
The purpose of the updated WPS is multifaceted. It prevents wage delays and manipulation, provides an official wage record to resolve labor disputes, prioritizes employee entitlements, and enables accurate labor market data collection by the Ministry of Labour. The system is designed to regulate the labour market and help employers avoid financial penalties.
In summary, the updated WPS in Oman mandates phased implementation of electronic wage transfers for most private-sector employees, includes expanded exemptions, shorter disbursement timelines, stricter penalties for non-compliance, and enhances government oversight to ensure timely payment and protect workers’ rights. The Ministry stated that adhering to these requirements is essential for safeguarding workers' rights and promoting transparent wage practices in Oman's labour market.
The updated Wage Protection System (WPS) in Oman's general-news is expected to significantly impact the business sector, especially finance, as employers are now mandated to electronically transfer wages for a majority of their employees through banks or financial institutions from September 2025, following the Ministry of Labour's stricter regulations. The WPS, designed to ensure wage payment transparency, protect workers' rights, and prevent wage delays and manipulation, also imposes fines, suspension of government services, and potential legal prosecution for non-compliance. This system is part of the ongoing efforts to regulate the labour market and promote transparent wage practices in line with the country's broader business environment.
