Oman introduces tougher rules for expat recruitment agencies from January 2027

Dubai: Oman has introduced stricter regulations governing the recruitment of expatriate workers, requiring agencies to provide insurance coverage, refund employers in specified cases and complete recruitment procedures within 45 days.

The new rules, which take effect on January 1, 2027, also impose financial guarantees and licensing requirements on recruitment agencies as part of efforts to regulate the sector and protect the rights of employers and workers.

The Ministry of Labour clarified the provisions following discussions with recruitment agency owners over their financial obligations and the implementation of Ministerial Decision No. 390 of 2026.

Dr Saif bin Mohammed Al Busaidi, adviser to the Minister of Labour for Labour Welfare, said the ministry had organised a workshop to explain the regulations, address concerns raised by agency owners and clarify their responsibilities.

Refunds and insurance protection

Under the regulations, employers are entitled to a full refund of recruitment service fees in specified circumstances during the first 90 days after a worker begins employment, unless they agree with the agency to provide a replacement worker.

For domestic workers, employers may also qualify for a partial refund after the initial 90-day period and up to two years, subject to the conditions set out in the regulations.

Recruitment agencies must obtain insurance coverage for their service contracts to protect against specified risks. Coverage for certain claims, including natural death and qualifying disability, begins when the worker arrives in Oman or is transferred to the employer.

However, insurance protection against workers refusing to work without an acceptable excuse or leaving employment without lawful justification takes effect after the first 90 days.

Al Busaidi said the estimated insurance premium would be approximately 1 per cent of the recruitment contract's value.

He added that insurance companies participating in the discussions had expressed willingness to offer additional coverage options for the initial 90-day period.

Recruitment deadline set at 45 days

The regulations require agencies to bring recruited workers into Oman within 45 days of signing the recruitment service contract, unless a shorter period has been agreed.

If an agency fails to meet the deadline, the employer may terminate the contract or agree in writing to extend the recruitment period by up to 30 days.

The measures are intended to establish clearer contractual obligations and provide employers with remedies when recruitment agencies fail to meet agreed deadlines.

New licensing and financial requirements

Recruitment agencies must deposit a financial guarantee of RO5,000 with the Ministry of Labour and pay RO300 for a licence valid for two years.

The regulations also stipulate that agency owners, partners and authorised signatories must be Omani nationals, while owners and partners must be at least 23 years old.

In addition, the owner or full-time managing partner must possess at least a General Education Diploma or have a minimum of five years' experience in recruiting non-Omani workers.

Ministry responds to agency closure concerns

Addressing reports that some recruitment agencies had closed, Al Busaidi attributed the closures primarily to management-related problems rather than the new regulatory requirements.

He stressed that the ministry remained open to feedback from recruitment agencies and was prepared to review provisions where necessary.

The new framework seeks to strengthen accountability in Oman's expatriate recruitment sector by establishing clearer financial responsibilities, recruitment deadlines and insurance safeguards for agencies and employers.