On 31 May 2020, Lieutenant General Hassan Mohsin Al Shuraiqi, the Inspector-General of Police and Customs, announced a decision of the Royal Oman Police 157/2020 (Decision), which permits the transfer of an expatriate employee to another employer in Oman, in cases where the employment contract with the existing employer has ended. This Decision shall be published in the Official Gazette and will be implemented from 1 January 2021.

The Decision, once published, will amend Article 24 of the executive regulations of the Law on the Residence of Foreigners. Since 2014, the Law on the Residence of Foreigners does not permit the transfer of an expatriate employee to another employer unless the employee has obtained a no-objection certificate (NOC) from the existing employer. This law requires that, if the expatriate employee does not obtain an NOC from their current employer to join another company in Oman, the expatriate employee is banned from working in Oman for any other employer for two years.

Essentially, the transfer is now dependent on the NOC from the existing employer and the new prospective employer having met Omanisation requirements and having been granted the requisite labour clearance from the Ministry of Manpower as authorisation to employ the expatriate employee. Transfer of the expatriate employee's sponsorship will also effect the transfer of his family members to the new sponsor once the necessary conditions of his own residence are fulfilled. Until the procedures of the sponsorship transfer are completed, the liability of the first sponsor remains in respect of all matters relating to the expatriate's residence.

Article 1 of the Decision provides: Article 24 of the executive regulations of the Law on the Residence of Foreigners is replaced by the following text:

"It is permissible for a foreign employee to transfer from one employer to another, provided the employer has a licence to recruit expatriate employees, and on condition that they provide proof of the end or termination of the employment contract. They must also provide evidence of the approval of the competent government authority on allowing the signed contract with the second employer and it must be in accordance with the controls set by the competent authority."

The remaining provisions concerning the transfer of family members and the continuing responsibility of the first employer until the transfer is completed are unchanged.

Upon interpretation of the amendment above, if the transferring employee is required to present "confirmation of the end or termination of the employment contract", then this implies that the employee would either have to complete the term of previous employment or have had the employment contract terminated. Despite the parties agreeing to the expatriate employee's future employment, the new employment is subject to the "approval of the competent government authority to allow the signed employment contract with the second employer". This appears to give an indication that the Ministry of Manpower's authorisation, both in the form of issuing its written approval of the new employment contract and granting the labour clearance for the employment of the expatriate employee is now part of the process. Further, the future employment of the expatriate employee must be in accordance with certain measures or conditions set by the competent authority. Despite these measures or conditions not being mentioned, in the future the approval to employ expatriate employees may continue to be subject to the employer meeting its Omanisation targets as well as any other prerequisites for the employment of expatriate employees to be announced by the authorities.

The Decision will be welcomed by employers and expatriate employees alike. However, it is important to note that, even if this is a departure from the current position which requires an NOC, both the employer and the employee should be aware of the new obligations on each party. For the expatriate employee, there will be a requirement to have completed his or her employment contract or provide documented evidence of the end or termination of the employment contract from the existing employer. For the new prospective employer, it should have the licence to recruit expatriate employees and must also provide evidence of the approval of the competent government authority which permits the signed employment contract. This approval would be subject to the conditions set by the competent authority in the future. We will update this note once the authorities have clarified what form the approval of the competent government authority will take and what the controls set by the competent authority mean in this context.