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EDITOR IN CHIEF- ABDULLAH BIN SALIM AL SHUEILI

Oilfield firms must comply with ‘transferability clause’

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MUSCAT, April 1 -


Oman’s Ministry of Oil and Gas has warned that it will crack down on companies that attempt to circumvent their obligations under Article 48 of the Oman Labour Law, which mandates employers to redeploy their national staff within or outside their organisation when a contract or project comes to an end.


The Ministry’s Under-Secretary, Salim bin Nasser al Aufi (pictured), issued the warning at a recent forum hosted by the Oman Society for Petroleum Services (OPAL).


Speaking at the event, Al Aufi said he had learnt of surreptitious actions by some contractors to duck their responsibilities set out under the ‘transferability clause’ enshrined in Article 48 of the Labour Law.


Article 48, the Under-Secretary said, mandates employers to accommodate Omani staff that are made redundant from one contract to another, or accommodate as many Omanis as possible within the organisation.


“Despite the fact that some of us don’t like it, Article 48 is on the statute books and is here to stay for a while. We have to comply with the provisions of this Article,” Al Aufi stressed.


Some contractors, the official lamented, were found resorting to “3 or 4” tactics to evade their responsibility under the ‘transferability clause’.


“For example, the contractor doesn’t necessarily register all of the Omanis in the workforce. Thus, when the transferability clause is invoked, there are more Omanis lined up for transfer than the numbers registered when the contract was due to be awarded. This is not fair because the new contractor inherits more people that he has planned for when he submitted the bid for the contract,” Al Aufi said.


“Secondly, as soon as the existing contractor knows that he is not the winner of the new contract, he starts moving Omani staff around. He takes the good people from the existing contract and replaces them with those he doesn’t want to continue in his business, thereby forcing the new contractor to pick up less desirable staff. This is not in the spirit of how we implement the transferability clause,” the Under-Secretary noted.


“Thirdly, the contractor changes the remuneration of the Omani workforce to be transferred, either by granting a promotion or a pay increase to individuals that the contractor knows will be transferred. This leaves the new contractor footing a bigger wage bill that wasn’t part of the plan, thereby impacting their financials. In the upshot, the new contractor inherits more people that planned for, less performing people, and more expensive staff.”


Following the unearthing of a handful of cases in this regard, the Ministry is preparing to take measures to clamp down on these practices, Al Aufi said.


“The Ministry is now forced to put in place a process whereby we will enforce registration of the entire manpower against every contract. Consequently, those that are not registered will not be part of the transferability process, leaving the contractors liable to secure the interests of those left out. The system being put in place is in fairness to those doing an honest job,” the official said, adding that the plan will be implemented hopefully before the end of this year.


Earlier, the Under-Secretary commended the operators and contractors on the successful execution of the Ministry’s Redeployment Strategy that enabled around 5,000 Omanis made redundant by the oil price collapse to be posted elsewhere within the industry.


A high-level committee, made up of officials of the Ministry of Oil and Gas and Ministry of Manpower, among other stakeholders, no longer has any more cases for redeployment for the first time since the programme was launched in 2014 at the start of the slump, said Al Aufi.


“We are almost done with redeployment and need to move on. The committee can’t sit forever,” the official added.


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