We are writing to update you regarding the new ministerial decision regarding salary increment for Omani employees in the private sector.
The Ministry of Labour (MOL) has issued Ministerial Decision No. 317/2025, replacing the previous rules under MD No. 541/2013. This new regulation, published in the Official Gazette (Issue 1606), introduces performance-based annual salary increments for Omani employees in the private sector.
Key Changes
- Performance-Based Rates:
- Excellent: 5% of basic salary
- Very Good: 4% of basic salary
- Good: 3% of basic salary
- Acceptable: 2% bonus (one-time)
- Weak: No increment
- Eligibility: At least 6 months of service by the increment due date (January each year).
- Effective Date: Increments apply from 1 January 2026; the decision took effect 28 July 2025.
Other Provisions
- Performance Evaluation Reports: Employers must prepare annual appraisals for each Omani employee.
- Transferred Employees: The new employer pays the increment, based on the appraisal by the employer where the employee spent the longer period that year.
- Reduction/Suspension: Possible in cases of:
- Employer’s financial hardship (MOL approval required)
- Employee under investigation for a workplace offence or criminal matter
- Extended unpaid leave or absence exceeding six months
- Employee Rights: Employees may appeal appraisal results to the MOL.
- Penalties: OMR 50 per affected employee for non-compliance, multiplied by the number of violations.
Actions by Employer
- Update performance appraisal policies and documentation in 2025.
- Ensure appraisals for 2025 are completed in time for January 2026 increments.
- Communicate changes to HR and payroll teams.
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