Omani employers will now have to give staff a full six months to turn things around before they can be let go for performance issues.
The requirement is part of Oman’s new Labour Law, Royal Decree 53/2023, which came into effect in July 2023. Article 43 of the law says a worker cannot be dismissed solely for failing to meet efficiency targets unless the employer first identifies the specific areas of weakness and provides a six-month window to improve.
If performance remains below standard after that period, termination may proceed. For Omani nationals, the company must then recruit another Omani to replace them.
The law was issued by His Majesty Sultan Haitham bin Tarik to create a more balanced relationship between employers and employees and increase transparency in workplace practices.
Beyond performance dismissals, the law also recognises termination for business closures, bankruptcy, downsizing, or changes in production systems. Economic-related layoffs (business-related) now require prior approval from a committee formed by the Ministry of Labour, Ministry of Commerce, Oman Chamber of Commerce, and the General Federation of Trade Unions.
Worker rights have been strengthened across the board. Employers are barred from holding expatriate passports without written permission. Expat workers who are dismissed have 30 days to lodge a complaint. The law also guarantees at least 30 days of annual leave after six months of service, with leave periods allowed to be merged by mutual consent.
By introducing a mandatory improvement period, Oman is moving away from abrupt terminations and toward documented performance management, giving employees time to correct course while holding employers accountable to clear procedures.
