Sunday, Apr 28, 2013
Muscat: The monthly minimum wage of Omanis working in the private sector will almost double to OMR 325 (AED 3100 approx) with effect from 1st July 2013.
A ministerial decision to this effect was issued on Saturday by Manpower Minister Sheikh Abdullah bin Nasser Al Bakri. It sets the basic salary at OMR 225 which, combined with minimum allowances of OMR 100, effectively boosts the gross minimum wage to OMR 325 per month. The increase represents a 47.7 per cent jump over the current minimum of OMR 220 that private sector employers were required to pay their national staff.
A significant proportion of the estimated 220,000 Omanis working in the private sector stand to benefit from the measure, which was first mooted by the consultative Shura Council and subsequently approved by the Council of Ministers, the cabinet, earlier this year. The hike is also designed to stanch an outflow of low-paid Omani workers from private establishments to the government and public sectors where the minimum wage has traditionally been higher than that offered by the private sector.
The Ministerial Decision also urges private sector employers to raise the basic salaries of other Omani workers whose current pay packages are above that of the minimum wage prescribed under Saturday’s measure. It also requires private establishments to pay other allowances prescribed under the Omani Labour Law regardless of the latest salary increase.
Alarmed by the higher wage bill that private employers must shoulder as a result, a number of umbrella groups have urged the government to offset part of this burden through a system of reimbursements and subsidies.
The influential Oman Society of Contractors, a pan-industry grouping recognized by the government, has said its members would abide by the new measure, but has appealed to the government to compensate firms executing contracts under financial terms agreed before the hike was announced. It is unclear if the government will accede to this request.
Staff Report
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