Oman has sharply increased penalties for companies that fail to meet local hiring quotas, a decision intended to boost employment among nationals but likely to squeeze businesses already under pressure from the US-Israeli war with Iran.
A new law issued by Oman’s Ministry of Manpower has increased labour permit renewal fees for expatriate workers from OMR211 ($550) to OMR622 per employee if the company fails to adhere to the nationalisation quota.
Under the law, which took effect from February 1, a quarter of the workforce of any company must be Omani. Companies not adhering to that quota will also pay double for business licence renewals.
But company directors across retail, technology and media say they are under pressure from the effects of the Iran conflict.
“Our revenues are already hit by the war and we are cutting costs and this law is a knife through our earnings – its implications can lead to more revenue losses,” Abdulhameed Al Hamadani, founder of consultancy group FliQCard, told AGBI.
He added that the ministry needs to slow its job nationalisation plans and allow businesses to make adjustments from losses.
The number of Omanis employed in all sectors by March this year totalled just over 893,000, official data shows. About 40 percent work in government ministries, according to the National Center for Statistical Information (NCSI).
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