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Times of Oman
24 February 2014

Muscat: Cash-in-hand wages will become a thing of the past under new rules which will ensure all employees in Oman, local and expatriates, get their salaries paid into a bank account.

The Ministry of Manpower (MoM) in association with the Central Bank of Oman (CBO) is in the process of implementing the Salary Payment System (SPS), which will apply to all workers in all sectors, officials confirmed. "The process of implementing SPS began in December 2013. We have started to compile data," an official from MoM said.

When the new system is implemented, employers cannot make payment of salaries by cash but only through the regulated channels as approved by the CBO.

The system will eventually ensure that employees are paid salaries on time and in accordance with the contract. The scheme is applicable to all employees, local and expatriates, in all sectors, as prescribed by the government from time to time.

"By ensuring that all salary payments are routed through banking channel, the system enables maintenance of proper record of payment or non-payment of salary which can be relied upon to settle any dispute. The system is particularly beneficial to low salaried and uneducated employees who are vulnerable to exploitation by the employers," the official noted.

Under the system, employers have to choose one of the financial service providers (registered agents) such as banks, money exchange centers or any other service providers registered and approved by the CBO for disbursement of salary. However, the employers are free to choose any one of their registered agents as per their convenience.

Cross–verification
When the system is implemented, employers should submit the list of employees along with their salary details to the MoM through the CBO. This would help in cross-verification of the salary details with the database of the ministry. Salary files received from employers will be uploaded by the registered agents, which will be transmitted to CBO and MoM through the SPS, which, in turn, are approved and transmitted back to the agent for payment of salaries.

According to the system under process, employers are also banned from charging any fee from the employee for payment of system.

Earlier, Hamood bin Sangour Al Zadjali, the executive president of CBO, also underlined the need for implementation of the law on salary protection scheme and urged the bankers to contribute to the national project of Oman which is aimed at meeting the government's commitment to protecting the labour rights.

He urged bankers not to refuse opening of accounts for low-salaried employees on the grounds of high cost of maintenance of such accounts.

Welcoming the move, Shajji Sebastin, a Muscat-based social worker, said the system would help minimise labour disputes arising out of non-payment of salaries as per contract. "Similar system has been implemented in the United Arab Emirates (UAE) and Saudi Arabia," Shaji added.

Meanwhile, representatives from medium size construction companies said they still have not got instructions from the ministry.

"Now also, many among us make salary payments in cash to employees due to various reasons. So, when the system will come into effect, it will come to an end," company representatives said.