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Know Oman: What are the end of service benefits?
July 5, 2020 | 5:53 PM
by Times News Service
Yasin Chowdhury, Partner and Head of Corporate Advisory at Al Faqih & Co, a legal consultancy firm in the Sultanate.
 
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Muscat: Employees, on leaving a company, are entitled to receive their end of service benefits, as laid down in Oman’s Labour Law, a legal expert practicing in the country has said.

End of service benefits include a gratuity owed to an employee which is calculated on the amount of time (s)he has spent working for the employer, said Yasin Chowdhury, Partner and Head of Corporate Advisory at Al Faqih & Co, a legal consultancy firm in the Sultanate.

The entitlements available to an employer on completion of his job are listed as part of the employment contract signed by him on beginning work with the company.

“Generally, under the law of employment of Oman, when we talk about end of service benefits, we refer to it as a gratuity,” he explained. “Therefore, an employee who serves a certain amount of time with an employer, is entitled to receive a certain percentage of amount from the employer, upon termination of his employment.



“About calculation of gratuity, it depends on how many years that particular employee has served that employer,” added Chaudhary.

“If he/she has served a period of three years, then that employee will receive 15 days of basic salary that he has last drawn, for every year served. So, it will be 45 days in total for the first three years, and from the fourth year onwards, you will be getting a full month’s basic salary for each year served. That’s how you calculate gratuity or the end of service benefits.”



Employees in Oman, irrespective of whether they are employed on short-term or fixed-term contracts, or long-term, indefinite ones, are entitled to receive their end-of-service benefits, which in addition to the gratuity owed to them, could also contain other benefits.

“Regarding whether an employee is entitled to end of service benefits, it doesn’t matter whether the term he served was definite or indefinite,” explained Chaudhary. “Under any kind of contract of employment, when the employee has served for a period of at least one year, he will be entitled to receive his gratuity.

“I would like to highlight one more thing here: when we talk about end of service benefits, it’s not just about gratuity,” he added. “There are other things which an employee can ask for, upon termination, if they are due. For example, if there is any unpaid salary that is due, then that gets added to the end of service benefit, which an employer is bound to clear.”

Chaudhary went on to say: “If there is any unused annual leave, then the employee can ask for compensation in place of that unused leave.”

Employees who intend to leave their company are also entitled to receive from their employers a letter of experience, which can be used to help them find work in the future.

“Even upon termination, as the Labour Law, the employee is entitled to receive a certificate of experience, explaining his position, his remuneration and his performance, to the advantage of the employee,” explained Chaudhary.

“This is a good benefit to the employee, because even if the employer acts hostile, he is not at liberty to put anything in this letter that will be a disadvantage to the employee.

“This certificate of employment or character certificate will help the employee take up another job with another employer,” he added. “The employer is bound, by law, under the Labour Law of Oman, to provide a certificate.”

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