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MoL cracks whip on firms violating Wage Protection System

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Muscat: The Ministry of Labour (MoL) has warned companies which do not comply with the transfer of employees' salaries via the Wage Protection System (WPS).

The warning holds significance as a number of private sector companies continue to defer payment of employee salaries by several months despite the overall economic situation in the country getting better over the past year.

In a statement, the Ministry of Labour said that as per Article (53) of Chapter One, part four of the Omani Labour Law issued by Royal Decree No. (35/2003), 'The employer will not be cleared of the employee's salary unless the amount is deposited in the employee's account at one of the locally approved banks.'

A resolution by the minister may determine the exceptions where the employee's salary may not be deposited in his or her account.

Any violator will be punished according to Article (116) of the same law. Whoever violates these provisions shall be punished with a fine not exceeding RO100 and the fine shall be multiplied by the number of workers who are the subject of the violation.

The non-compliant companies may face suspension of their dealings with the ministry in terms of completing permit requests or loss of the membership of best-performing firms as well as other services available in the system.

Around 13,000 of the total 24,000 labour complaints received by the ministry in 2022 were related to payment of wages, this was confirmed by the Ministry of Labour in a statement.

The Wages Protection System (WPS) is aimed at ensuring fair pay for workers and improving working conditions and enhancing the welfare of all parties involved.

WPS is an electronic tool created by the Ministry of Labour and the Central Bank to supervise and track wage payments in private sector businesses, guaranteeing their compliance with the Labour Law by transferring workers' salaries to their bank accounts.

WPS maintains a steady process of salary distribution, while also monitoring any payment delays, allowing the ministry to take preventive measures to ensure workers receive their pay and prevent any labour disputes, strikes, or work stoppages due to delayed payments.

WPS is deemed to be a vital part of economic reform, aimed at safeguarding the earnings of private sector employees and establishing a precise database of their salaries.

This system promotes a stable employer-worker relationship, increases productivity, and minimises wage-related conflicts.

The recently introduced system aims to streamline the process of applying for various services provided by the ministry that require the attachment of wage-proof documents, including manpower recruitment permits, wage adjustments, and work leave reports. The system eliminates the need for individuals to attach physical wage files as verification can now be completed electronically through the platform. This results in a significant reduction in both time and effort expended by applicants.

WPS also helps employees in small commercial private sector enterprises, as they are now obligated to open bank accounts for their expatriate workforce whose salary is less than one hundred Omani riyals.

Additionally, private sector institutions are required to update the wages of their workforce in the ministry's database.

It should be noted that the method for bank transfers of wages in the Sultanate of Oman varies depending on the transfer formula used by institutions and employers.

In some cases, the transfers may not be reflected in statistics and monitoring ratios by the Central Bank and the Ministry of Labour.

To ensure that all transfers are included within the wage system and accurately reported, the ministry is taking steps to protect the rights of workers and companies.

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