Hire employees in Oman
What a foreign company needs to know before employing people in Oman: whether you need an entity, which occupations are now reserved for Omani nationals, what an Omani or expatriate hire actually costs once Social Protection Fund contributions and end-of-service are added, and how the Wage Protection System, notice rules and the 2028 income tax affect payroll and termination. Written for CHROs, CFOs, General Counsel and founders.
Quick answers
The questions leadership teams ask first.
Do I need an Omani entity to hire?
No. There are three routes:
- Employer of Record. Dryft Global employs the person through an Oman-registered entity, holds the Ministry of Labour permit for eligible expatriates, registers staff with the Social Protection Fund (SPF) and runs payroll through the Wage Protection System. You direct the work.
- Direct entity. You register a company through the Oman Business Platform, with 100% foreign ownership allowed in most activities, then register with the Ministry of Labour and the SPF and plan for your Omanisation percentage.
- Independent contractor. Rarely workable for people in Oman. Expatriates must work for the employer named on their permit, and employers may not engage employees who work remotely from abroad.
When should I use an EOR instead of setting up an entity?
Use an EOR for your first hires and for market entry. You avoid company registration, Omanisation planning and Ministry of Labour administration, and the EOR carries permits, WPS payroll, SPF contributions and end-of-service obligations. Your own entity earns its keep for larger teams or a long-term presence.
What does an employee actually cost beyond salary?
There is no income tax until 2028. An Omani employee costs the employer 14.5% in SPF contributions. An expatriate in a permitted occupation costs about 8% over gross in statutory terms today: an end-of-service gratuity of at least one month's basic wage a year, 2% to the SPF and work permit fees. With customary medical, ticket and visa costs it is about 10.5%, rising to about 12% once the 9% savings scheme and work injury cover start.
Can I hire an expatriate software engineer?
Often not. Under Ministerial Decision No. 501 of 2024, computer programmers, electronic computer engineers and computer operators are reserved for Omani nationals from 1 January 2026, systems analysts and network specialists since 2025, and web designers from 2027. Eligibility depends on the Ministry of Labour occupation code, so check the current reserved list for every role and plan IT teams around Omani nationals unless a role fits a permitted occupation.
Can Dryft Global legally employ my team in Oman?
Yes. Dryft Global employs your team through an Oman-registered entity. We register contracts with the Ministry of Labour, obtain permits for eligible expatriates, register staff with the SPF, run payroll through the Wage Protection System and manage end-of-service obligations, and we structure each placement as our own service delivery so that it respects the permit and Omanisation rules, confirmed with local counsel for each role.
Hiring routes compared
Speed, permits and liability differ by route.
| Factor | Direct Omani entity | Dryft Global EOR | Independent contractor |
|---|---|---|---|
| Time to first hire | Weeks for registration, Ministry and SPF set-up | Visa timelines for new expatriate arrivals | Rarely available |
| Registration | Required | Not required | Not applicable |
| Permits and WPS payroll | Your responsibility | Handled by Dryft Global | Not applicable |
| SPF, end-of-service and Omanisation | Your responsibility | Handled by Dryft Global | Contractor's own |
| Statutory liability | Direct corporate exposure | Assumed by Dryft Global | High if reclassified |
| Best fit | Large teams, long-term presence | First hires, market entry | Short independent projects |
What an employee costs in Oman
Salaries are quoted as a monthly package, commonly split into basic pay, housing and transport. Because computer programmers and computer engineers are reserved for Omanis from 1 January 2026, the model below leads with an Omani national: a Muscat software engineer on OMR 1,500 a month in 2026. The expatriate comparison applies only if the role fits an occupation code open to expatriates.
| Component | Employer share | Notes |
|---|---|---|
| SPF, Omani national | 14.5% | 11% pension, 1% injury, 0.5% job security, 1% maternity, 1% sick leave; pension and injury to OMR 3,000 |
| Total employer on-cost, Omani national | 14.5% | Employee pays 8%; no permit fees or gratuity |
| End-of-service gratuity, expatriate | ~5% | One month's basic wage a year; 9% of basic once the savings scheme starts |
| SPF maternity and sick leave, expatriate | 2% | Work injury 1% from July 2028 |
| Work permit | ~0.8% | OMR 301 for 24 months; 30% off if Omanisation-compliant, double if not |
| Medical insurance, ticket, visa and resident card | ~2.7% | Customary; higher with family |
| Total employer on-cost, expatriate | ~8% to 12% | About 7.8% statutory and 10.5% with benefits today; about 12% by 2028 |
On the model salary, an Omani hire costs about OMR 1,718 a month (about USD 4,467) before the EOR fee, and nets about OMR 1,380 after the 8% SPF deduction. An expatriate in a permitted occupation costs about OMR 1,618 a month in statutory terms and about OMR 1,658 with customary benefits (about USD 4,311). Basic wage is assumed at OMR 900. Medical, ticket and visa figures are typical budgets, not fixed rates. Ask us for a cost model with your package.
Payroll and tax
Monthly-paid staff must be paid at least once a month, within 3 days of the end of the pay period, into an account at a licensed bank or financial institution through the Wage Protection System. The employer bears the burden of proving payment, and breaches can bring warnings, suspension of new permits and fines of OMR 50 per worker. SPF contributions are due by the 15th of the following month, and hires, exits and wage changes must be notified within 14 days.
Social protection
Omani employees: employer 14.5% and employee 8%, with pension and work injury on wages up to OMR 3,000 a month. Expatriates: the employer pays 1% maternity (since July 2024) and 1% sick leave (since July 2026), with 1% work injury from July 2028; there is no employee deduction. The expatriate end-of-service gratuity of at least one month's basic wage a year will be replaced by a 9% monthly savings contribution to the SPF no later than 19 July 2027. GCC nationals are covered at their home country's rates.
Income tax
There is no personal income tax until the end of 2027. From 1 January 2028, residents pay 5% on taxable income above OMR 42,000 a year, and employers will withhold it from salaries. Corporate income tax is 15%, or 3% for qualifying small businesses, large multinational groups are subject to 15% top-up rules from 2025, and VAT is 5%.
Minimum wage
Omani nationals in the private sector have a minimum of OMR 325 a month, made up of OMR 225 basic and OMR 100 allowances. A proposed increase has been under review, so check the current figure. There is no statutory minimum for expatriates; the wage in the contract registered with the Ministry of Labour applies.
Leave and mandatory benefits
- Annual leave. At least 30 paid days a year after six months' service, with up to 30 unused days carried over.
- Public holidays. Paid, including Accession Day, National Day and the Islamic holidays, which follow the lunar calendar.
- Sick leave. Up to 182 days a year on a graded scale: full pay for 21 days, then 75%, 50% and 35%. The employer pays the first seven days and the SPF funds the rest for insured workers.
- Maternity. 98 days on full pay, funded by the SPF, plus one paid nursing hour a day for a year.
- Paternity. 7 paid days within 98 days of the birth.
- Working time. 40 hours a week, 8 hours a day; 30 hours a week in Ramadan for Muslim workers. Overtime at 125% by day and 150% at night. Sunday to Thursday working week.
- Health insurance. Private medical cover is customary; check current health insurance requirements before quoting.
Termination and notice periods
Probation can last up to three months for monthly-paid staff, once per employer, and either party may end it on seven days' notice. After probation, termination must rest on a valid reason listed in the Labour Law.
| Situation | Requirement |
|---|---|
| Notice, indefinite contract | 30 days for monthly-paid staff, 15 days for others, or pay in lieu |
| Poor performance | At least six months to improve, and notice to the Ministry of Labour 3 months before termination |
| Redundancy for economic reasons | Approval of a Ministry-chaired committee and at least 3 months' notice |
| Unjustified dismissal | Reinstatement or compensation of up to 12 months' wage |
| Expatriate end-of-service | At least one month's basic wage per year, paid on exit, until the savings scheme starts |
- Summary dismissal is narrow. Article 40 lists the grounds, such as forged credentials, serious financial loss through error, disclosing secrets or assault.
- Job-hunting time. During notice the worker may take 10 paid hours a week to look for work.
- Disputes. Claims go first to the Ministry of Labour, which has up to 30 days to settle them, before referral to court.
Can I use independent contractors?
Rarely. Expatriates must work for the Oman-registered employer named on their permit, and Ministerial Decision No. 523 of 2025 bars employers from engaging employees who work remotely from abroad. Lawful placements with another business are limited: secondment of an expatriate is capped at six months a year under Ministerial Decision No. 730 of 2024, and from 2027 recruitment offices for non-Omani manpower must be Omani-owned. That is why an employer of record arrangement in Oman must run through an Oman-registered employer, structured as its own service delivery or through a licensed Omani partner, and confirmed with local counsel for each role. For anyone who works like an employee, a properly structured EOR or your own entity is the compliant path.
The legal framework in brief
Oman has one Labour Law for the private sector, with permits, Omanisation and wage protection run by the Ministry of Labour and social insurance by the Social Protection Fund. The instruments you will hear most:
- Royal Decree No. 53 of 2023. The Labour Law: contracts, probation, working time, leave, notice, termination and the expatriate gratuity.
- Royal Decrees No. 52 of 2023 and No. 60 of 2025. The Social Protection Law and the phased expatriate coverage and savings scheme.
- Ministerial Decision No. 501 of 2024. Occupations reserved for Omani nationals, including IT roles.
- Ministerial Decisions No. 602 of 2025 and No. 729 of 2024. Work permit fees and the Wage Protection System.
- Royal Decree No. 56 of 2025. The 5% personal income tax from 2028.
- Royal Decree No. 6 of 2022. Personal data protection, fully enforceable since February 2026, with 72-hour breach notification.
- Authorities. The Ministry of Labour, the Social Protection Fund, the Oman Tax Authority, the Royal Oman Police and the Ministry of Commerce, Industry and Investment Promotion.
Where the talent is
About 5.4 million people live in Oman, about 43% of them expatriates, and the jobseeker rate among Omanis was 3.1% in 2025. Omanis make up about 15.5% of the private-sector workforce, and Omanisation targets and reserved occupations mean many teams, especially in IT, are built around Omani nationals. Gulf Standard Time (UTC+4) overlaps most of the European working day. The working week runs Sunday to Thursday, and Ramadan shortens hours for about a month each year. Arabic is the official language and contracts must be in Arabic, but English is the working language in most international offices.
| Area | Talent and industry concentration |
|---|---|
| Muscat | Government, banking, headquarters, professional services and the Knowledge Oasis Muscat technology park |
| Sohar | Port, free zone and heavy industry |
| Duqm | Special economic zone, refining and port |
| Salalah | Port, free zone and logistics |
Oman Implementation Kit
This page tells you the rules. The kit tells you what to do, in what order, and what goes wrong when you skip a step.
- Step-by-step checklist, from route selection to first WPS payroll
- Reserved occupations check for every role before recruiting
- Package structuring worksheet: basic, housing, transport and the end-of-service base
- Cost calculator for Omani and expatriate hires: SPF, gratuity, permit fees and benefits
- Timeline for the expatriate savings scheme, work injury cover and 2028 income tax
- Notice, performance and redundancy procedure checklist
- Every official Omani authority with direct links
This guide is general information, not legal, tax or immigration advice. Omanisation lists, SPF rates and permit fees change frequently. Confirm current figures with a qualified adviser or with Dryft. Last reviewed November 2026.
Ready to hire in Oman?
Tell us who you want to hire and whether they are Omani nationals or expatriates. You will get a cost model and a compliant route within a day, from a person who has done this before.