Oman bans recruitment of expat workers in some sectors

Organisations registered as ‘learning and development centres’ cannot employ new foreigners for six months

Oman’s Ministry of Manpower (MoM) has announced that companies registered under the umbrella of ‘learning and development centres’ will not be allowed to recruit foreign employees for six months.

The aim is to encourage companies to re-classify themselves into more specific categories created by the Ministry of Commerce. Businesses were first asked to re-register themselves in January. Those that did can continue to hire foreign employees.

Specifically, this ruling affects: human resources development, language and IT institutes; nurseries; various types of training centres; specialised rehabilitation centres; Quran schools; and homes for the elderly or those with special needs.

Expatriates granted work permits prior to this ruling will not be required to leave their posts, the ministry confirmed.

Abdullah Al-Bahrani, director of the Center for Economic Education at Northern Kentucky University, said the industry-specific ban has been designed to better regulate employment in specialised industries. “I do not believe the intention is to limit expat workers in order to create opportunities for nationals, as some might suggest,” he said. “It has more to do with making sure the expat employee is working in the industry they were hired into and that they have the correct education, licensing, or any other necessary qualifications.”

However, he acknowledged that the ban would slow economic activity in impacted industries, and could cause a shortage of employees until firms reclassified their status and the ban was lifted.

“If the ban continues indefinitely, this could make it difficult for businesses to plan for the future. While costly, ensuring that everyone is classified and meets the expected qualification is important for the overall health of the industry,” he added.

Professor William Scott-Jackson, chairman of Oxford Strategic Consulting said he doubted that the ban was likely to be part of a wider policy to boost the hiring of Omanis.

“The general issue in most GCC countries is not so much that expats are ‘blocking’ nationals but that nationals prefer government roles or do not wish to take up some of the roles traditionally held by expats. Even if unemployment levels of nationals appear high, in many GCC countries, nationals carry out all sorts of informal or family-based work. So employment of nationals is often a structural supply problem, even though on the face of it there appear to be plenty of nationals to fill many expat roles,” he said.

“Nationalisation policies in the GCC do oscillate between actively reducing expats – as if the resulting vacuum will automatically be filled by nationals – and the much more useful focus on developing national human capital, so that nationals are seen as a valuable resource for the roles they aspire to.

“However, most of the GCC countries – in addition to Saudi Vision 2030, Qatar National Vision and Oman’s Vision – recognise that continued growth will need to include expats and propose ways to manage the mix more effectively.”

Oman has on occasion introduced punitive policies concerning expatriate workers. In particular, foreign workers who do not obtain a No Objection Certificate (NOC) from their employer when leaving their job are not allowed to return for two years. Despite recent calls for the law to be changed after claims that companies were abusing the NOC system, the MoM elected to keep the rules in place.

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