Muscat: Businesses that avoid paying for insurance for their employees will be banned by the Ministry of Manpower and the Ministry of Commerce and Industry, according to the Public Authority for Social Insurance (PASI).
Contributions are one of the most important sources of funding for the social insurance system.
The funds collected help insure the employee against disability, death and occupational injuries and diseases.
On the importance of collecting contributions both in full and on time, Khalifa bin Salem Al Badi, Head of the Contribution Section at the Public Authority for Social Insurance, told Times of Oman: “A delay in monthly contributions will mean that the employers must pay additional amounts and could be banned from the clearance of transactions with PASI and other bodies with which PASI have cooperation in this field.”
Regarding the importance of a clear and strategic method to pay contributions, Al Badi said: “The law specifies the period of payment of the due monthly contributions to be within fifteen days from the beginning of the month for payment. In case of delay by the employer or the insured, additional amounts shall be calculated as a result of the delay in contributions payment.
“In case of delay for three consecutive months, the employer is automatically blocked, and the employer or the insured won’t be able to clear any transactions at the authority, as well as with the Ministry of Manpower and the Ministry of Commerce and Industry, until the due amounts are settled by the authority’s concerned staff. In addition, in the case of bounced cheques, legal action is taken and the amount of outstanding monthly contributions is collected,” Al Badi added.
Saif Al Badi, head of Al Dhahirah Chamber of Commerce and Industry, spoke to Times of Oman about the how paying the insurance contribution on time is beneficial to all. “Companies are not required to pay any additional amounts when properly implementing the insurance system, as the insurance amount is deducted directly from the salary of the employee only, however, the more the company delays the payments, the more they have to pay.”
According to Al Badi, the list of beneficiaries of the insurance system has been increased,“Due to the importance of the social insurance system, recently the list of beneficiaries has increased to include taxi drivers, bus drivers, home business owners and freelancers, so that these groups can secure a fixed wage after reaching retirement age.”
The Insurance Inspection Department at the Public Authority for Social Insurance conducts field visits to verify that all Omanis working for an employer are included in the social insurance system.
Dr Anchan CK, a trade and investment advisor in Oman said, “Under the Social Security Law, the employer is solely responsible for the payment to PASI in respect of each relevant employee, which needs to be complied, according to Article 16 of the Social Security Law, which requires the employer to undertake payment of the full social security subscriptions to PASI, and the employer is solely responsible for payment of these subscriptions.
“It is important for a company to comply with PASI rules as PASI is the only social insurance organisation in Oman covering Omanis working in the private sector,” he added.
“The issuance of the social insurance law was part of the government’s great initiative to diversify the economy and encourage young Omanis to take jobs in the private sector. The Social Security Law aims to provide security against old age, disability, death or occupational injury and disease, thereby ensuring social stability for the insured and their dependents.”