Labour Status Correction Grace Period Extended Until December 31: What This Means for Employers and Investors in Oman
Muscat: The Ministry of Labour has announced an extension to the grace period for regularizing legal employment status in Oman. Initially scheduled to end on July 31, 2025, the grace period will now continue until December 31, 2025. This extension responds to numerous requests from individuals, employers, and workers seeking additional time to complete the necessary legal formalities.
This decision follows a previous circular issued on July 8, 2025, which had confirmed the original deadline. The Ministry’s extension aims to maximize the number of beneficiaries who can take advantage of exemptions and regularize their status without incurring fines or penalties. The move is part of a comprehensive labour market reform initiative launched in January 2025.
The initiative, effective from February 1, 2025, includes waivers and exemptions totaling over OMR 60 million. Key components include the cancellation of fines for expired labour cards inactive for more than seven years, waivers of repatriation ticket obligations dating back to 2017 and earlier, and the removal of financial liabilities on liquidated companies where workers have either been repatriated or transferred.
With this final extension, the Ministry urges all stakeholders to utilize the remaining time to renew expired labour cards, cancel work abandonment reports, transfer worker services, and settle outstanding obligations. Compliance with the applicable laws and regulations during this period is strongly emphasized.
All relevant departments and entities have been instructed to ensure the effective enforcement of the extension in accordance with public interest. The Ministry has clarified that no applications will be accepted beyond the new deadline of December 31, 2025. Beneficiaries are advised to complete their procedures via the Ministry’s official website and authorized service channels.
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The extension of the employment legal status correction grace period until December 31, 2025, presents a critical window for businesses in Oman to regularize their workforce without penalties, reducing compliance risks and potential fines. Smart investors and entrepreneurs should seize this opportunity to align with labor reforms, optimize workforce stability, and leverage the significant financial waivers offered, thereby positioning themselves advantageously in a more legally compliant and stabilized labor market. However, failure to act before the deadline may expose businesses to increased costs and legal challenges in the future.
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