MUSCAT: Employers across Oman will face new payroll and leave-management requirements from Sunday, July 19, when the insurance branch covering sick and other leave begins operating under the Social Protection Law.
The scheme introduces a contribution equal to 1 per cent of each covered worker’s contribution wage, paid entirely by the employer. Employees will not make a separate contribution to this insurance branch.
It will cover eligible Omani workers as well as specified categories of non-Omani employees in the public and private sectors.
In the second edition of its Himaya bulletin for July 2026, the Social Protection Fund said the branch would compensate employers for eligible leave allowances and related insurance contributions. The Fund said the measure was intended to strengthen employment and social stability while supporting business continuity.
Implementation follows a three-year legislative process that began with the promulgation of the Social Protection Law under Royal Decree No 52/2023. The law established sick and other leave insurance as one of Oman’s social insurance branches. Its provisions were originally scheduled to take effect two years after the decree was issued on July 19, 2023.
Royal Decree No 60/2025 subsequently extended the implementation period to three years, moving the commencement date to July 19, 2026.
A Social Protection Fund decision issued in June identified the non-Omani workers subject to compulsory coverage. These include expatriate employees in units of the state administrative apparatus and other public legal entities, as well as workers in private-sector establishments governed by the Labour Law.
The immediate change is an additional payroll-related contribution of 1 per cent. Employers will remain responsible for paying workers during eligible leave periods before submitting compensation claims electronically to the Social Protection Fund.
For sick leave, the employer bears the worker’s full wage during the first seven days. The insurance branch begins covering the eligible allowance from the eighth day, subject to medical evidence and the conditions prescribed by law.
Sick-leave coverage may continue for up to 182 days in a year. The allowance is calculated at 100 per cent of the wage from the eighth to the 21st day, 75 per cent from the 22nd to the 35th day, 50 per cent from the 36th to the 70th day and 35 per cent from the 71st to the 182nd day.
According to the Fund’s public guidance on sick and other leave insurance, the employer pays the eligible amount to the worker before applying to the Fund for compensation.
The branch also covers specified forms of other leave, including eligible periods connected to marriage, bereavement and accompanying relatives for medical treatment. Payments remain subject to the periods, conditions and supporting documents required under the law.
In certain cases, the branch will also meet specified old-age, disability and death insurance contributions during covered leave, helping to maintain the continuity of the worker’s insurance record.
Employers will need to ensure that payroll systems can calculate the new contribution from the implementation date. Human resources departments will also need accurate employee records, contribution-wage data, medical evidence and other documentation required when submitting claims.
