What is the Oman end-of-service gratuity, and who does it cover?
The end-of-service gratuity is the amount a worker earns for his years of service, payable when the employment ends, and its basis is Article 61 of the Labour Law promulgated by Royal Decree 53/2023 (in force 31 July 2023). It covers workers "who do not benefit from the provisions of the Social Protection Law" — the statutory test is coverage, not nationality, though in practice it matches the non-Omani private-sector workforce. Three groups sit outside it, and the scope selector above routes each to its explainer: the Omani national (whose provision is the Social Protection Fund pension), domestic workers (regulated by Ministerial Decision 574/2025) and government staff (civil-service rules). A note for GCC nationals: your coverage usually runs through your home fund's insurance-extension arrangements — check your home fund's position.
And the starting point that surprises many: there is no minimum service. The gratuity is owed for fractions of a year in proportion to the period served, from the very first day — probation included (Article 37 caps probation at three months for monthly-paid workers and counts it in service once completed). The "you must complete one continuous year" rule printed by many sites is the repealed law's condition — it died on 31 July 2023 and governs no settlement today.
The formula, step by step — with a fully worked example
The modern formula is simple at its core: one month of the last basic wage for every year of service, fractions pro rata. Article 1 fixes the units: the year is 365 days and the month is 30 days — so the daily wage is the monthly basic ÷ 30, and each year of post-changeover service is worth exactly one monthly basic. The article's words "not less than" make that month a floor, not a ceiling: if your contract or your employer's policy grants more, the more favourable term applies (Article 4: any term breaching the law is void unless it is more favourable to the worker).
Worked example (a published one, at its own rates): last basic OMR 400, exactly two years of service from 1 August 2023 to 31 July 2025. Step one: daily wage = 400 ÷ 30 = OMR 13.333. Step two: the whole service is after the law took effect, so no transition split: 2 years × 30 wage-days = 60 days. Step three: gratuity = 60 × 13.333 = OMR 800.000. Run the same numbers in the calculator above and you will see the same breakdown. Had your service started before August 2023, the transition split in the next section would apply.
The July 2023 changeover — the Ministry split and the whole-service reading
Before 31 July 2023 the governing law was Labour Law 35/2003, whose Article 39 paid: 15 days' wage for each of the first three years of service and one month (30 days) for each following year, on the last basic wage — and no gratuity at all under one year. The 2023 law raised the rate to a full month per year and abolished the one-year bar. But when Article 61 added pre-commencement service into the service period, it said that service "counts within the service period considered in determining the period of the gratuity due" — without stating at which rate.
The Ministry of Labour's announced position — this page's primary calculation: service before 31 July 2023 is computed at the old law's rates, service after it at one month per year, all on the last basic wage. The Ministry's published example: a worker on OMR 500 basic who started 1 August 2021 has his pre-changeover period paid at OMR 250 per year (half a basic wage = the 15-day rate) and his post-changeover period at OMR 500 per year. Your position in the old law's two tiers is counted from your original start date, not from 2023: a worker hired in 2020 does not restart the 15-day band at the changeover. This is the figure an employer's settlement will most likely show, which is why it is the headline here.
The whole-service reading — and why it is always shown as a secondary line: Article 61's text fixes one rate — "not less than one basic wage for each year of his service" — and then folds pre-commencement service into the period. On the bare words, a worker whose service ends today is arguably owed the new rate on his whole service. Legal commentary (Al Naba) argues exactly this and attacks the Ministry's circular as contradicting the article's text; some rigorous calculators adopt the textual reading and decline any split. This page does not settle the dispute for or against you: it shows both numbers side by side — six years at a basic of OMR 900 (from January 2020) gives OMR 4,050.000 on the split and OMR 5,400.000 on the whole-service reading — so you know the size of what is argued about before any claim.
And our stated position on a point the sources do not settle: a short service straddling the changeover (say six months: three before August 2023, three after) — could the old law's one-year bar swallow it? This page's answer: eligibility is governed by the law in force at the ending — Article 61, which has no minimum — and the split sets rates only. So the six months are paid: OMR 62.500 for the pre-changeover part and OMR 125.000 for the later part, at a basic of OMR 500.
No minimum, no fractions, no cap — three ways Oman is not its neighbours
The commonest Oman gratuity errors are imported from neighbouring laws. First — no minimum service: the one-year condition was in the repealed Article 39; today's Article 61 pays for fractions of a year from day one. Second — no resignation fractions: Omani law — old and new — has never scaled the gratuity down for resigning; the third and two-thirds scales are Saudi and Kuwaiti in origin, and any site that docks your Omani gratuity for resigning before three years is applying another country's law. Third — no cap: no ceiling appears in Article 61 or elsewhere; long service on a high basic produces its full figure untrimmed (12 years at OMR 800 basic: OMR 8,400 on the Ministry split). Compare: the UAE caps at two years' wage, Kuwait at 18 months' wage, and Qatar — alone with Oman — has no cap.
Basic wage only — Article 1's definition
The gratuity stands on your last basic wage, which Article 1 (definition 17) defines as the cash consideration agreed in the contract plus the periodic increment — and nothing else. Allowances (housing, transport, food, phone) belong to the "total wage" (definition 18) and stay out, unless your contract itself counts one of them as part of the basic. If your basic was raised at any point in service, the last basic governs every year — including the pre-changeover segment, under both readings. And your decisive document in any dispute over the base is the service certificate (Article 62): free, on request, stating the start and end dates, the work performed, the wage and the other benefits — obtain it before you sign any release.
How service ends — the number changes in one case only
Because Article 61 has no scales, the ending reason changes the guidance, not the figure: resignation with Article 38 notice (30 days for monthly-paid workers, 15 for others) takes the gratuity in full. Employer termination on an Article 43 ground (reaching pensionable age, Omanisation replacement, failure to reach the required competence after warning and a six-month grace period, closure or downscaling, an economic reason) — full. Expiry or mutual agreement (Article 42(1)) — full. And leaving without notice on an Article 41 ground — the employer's fraud at contracting, wages unpaid for more than two consecutive months or other essential obligations unmet, an immoral act by the employer towards you, assault on you by the employer, his representative or a supervisor, or a grave safety/health danger he knows of and does not remedy — preserves your gratuity in express words, "retaining all his rights, including the end-of-service gratuity", after you notify the employer.
Leaving without notice and without an Article 41 ground does not reduce the gratuity either — but your exposure sits in a separate account: compensation to the other party equal to the wage for the notice period (or its unobserved part), computed on your last total wage (Article 38). A separate claim, not deducted here; the only set-off against it is the employer's right to deduct amounts proven against you at the end of service (Article 96). Death in service ends the contract (Article 42(3)) and the gratuity and all dues pass to those entitled through you, with a privilege over all the employer's debts except court-ordered maintenance (Article 92) — the Omani text has no court-deposit machinery of the Qatari kind, so do not import it. Incapacity or exhausted illness (Article 42(3)–(4)) keeps the gratuity in full.
Dismissal for cause — Article 40's nine grounds and their guardrails
The one case in which the gratuity itself is lost: dismissal under Article 40 — dismissal without prior notice and without end-of-service gratuity, lawful only if you: assumed a false identity or resorted to forgery to obtain the job; committed an error causing gross material loss to the employer (provided he notifies the competent authority within 30 working days of learning of it); breached the written safety instructions despite written warning where the breach would cause grave harm; were absent without acceptable excuse for more than 7 consecutive days, or 10 separate days in one year (after written warning); disclosed the establishment's secrets otherwise than as legally authorised; were finally convicted of a felony or a crime against honour or trust, or of a misdemeanour at the workplace; were found at work drunk or under the influence of a narcotic or psychotropic substance, or committed an act against public morals; assaulted the employer or his representative, a supervisor or a co-worker at the work site causing illness and incapacity; or committed a gross breach of your obligation to perform the agreed work.
And dismissal is not the last word: no penalty without written notification of the charges, a hearing of your statements and a recorded defence (Article 63), and you may complain to the competent authority within 30 days (Article 10). If a court finds your dismissal arbitrary, your gratuity is restored and joined by — reinstatement or compensation of 3 to 12 months of your last total wage — plus notice-period wage and insurance contributions to the final judgment (Article 11 expressly lists "the end-of-service gratuity legally due" among what is paid in addition). That is why this calculator presents the Article 40 state as a flag, not a verdict.
The savings system — honestly dated
The Social Protection Law (Royal Decree 52/2023) created, in its Articles 135–143, a defined-contribution savings system: compulsory for non-Omani workers up to the compulsory amount, replacing the employer-paid end-of-service gratuity (Article 137), financed at 9% of the monthly basic wage payable by the employer (Article 139(1)) — nothing is compulsorily deducted from the worker, and voluntary extra contributions are allowed from the employer, the worker or others. The transition settlement sits in Article 138: for service before contributions begin, the employer either pays the Labour-Law gratuity when the service ends, or settles it to the savings system or to the worker directly — valued at the basic wage on the settlement date (the last sentence of Article 61 mirrors this). The saver owns the contributions plus their investment returns, paid out on the end of the employment relationship (unless he takes another job within the regulation's period), to his heirs on death, or on permanent disability — as a lump sum or in instalments per the regulation. Operating detail was issued early by SPF Decision R/7/2023: register the worker within 30 days of his starting work, and pay contributions within the first 15 days of the following month.
But — and this is where many pages go wrong — the system has NOT started. It was due to begin by 19 July 2026 at the latest; Royal Decree 60/2025 (13 July 2025) postponed it by a full year to 19 July 2027. The position today (November 2026): no contributions are due, no registration duty has begun, and your employer still owes you the gratuity directly under Article 61 when your service ends. Proof the delay is real and not paper: the sick-leave and unusual-leave insurance branch for non-Omanis did start on 19 July 2026 on the same decree's timetable — the savings system was the piece deferred. That is why the calculator shows a dated status panel and no "savings calculator": fund returns and the final regulation cannot honestly be computed today. The "2% guaranteed return" claim circulating on some sites rests on a single secondary source with no published text behind it — do not build on it.
Omanis and the Social Protection Fund
Article 61's text excepts whoever "benefits from the provisions of the Social Protection Law" — and an Omani in the private sector is compulsorily insured in the old-age, disability and death branch (contributions payable since 1 January 2024). So an Omani's end of service is not an employer gratuity but an SPF pension: entitlement age 60, with early-retirement routes (including women at 55 without reduction in the published frames), on contributions of 11% of the wage from the employer and 7.5% from the worker. A pension value is a function of a complete contribution record — wages and years — not of two numbers typed here; that is why the scope selector shows an explainer rather than a calculator. The practical Labour-Law link: Article 43(1) makes reaching pensionable age a lawful employer ground to end the contract unless otherwise agreed — and at that point there is no "gratuity", because the pension system is the entitlement.
Getting paid — payment, set-off, the certificate and claiming
When is it paid? Article 91: the employer must pay the wage and all amounts due immediately (at once) when the employment relationship ends — the single exception being that if YOU left of your own accord, payment may be made within 7 days of your leaving. (Beware a common error: "Article 63, seven working days" — Article 63 governs disciplinary procedure, not payment.) Set-off: attachment or assignment of wages is capped at one quarter under Article 96, and at the end of service government dues and amounts proven against you to the employer are deducted from the gratuity and other entitlements — not his estimates. That is why this calculator has no "debts" field. Your untaken leave is a separate settlement line, not part of the gratuity: annual leave is 30 days on full (total) wage (Article 78), and at the end of service you are owed the total wage for your accrued balance (Article 81) — note the mirror image of Kuwait: there the gratuity is on the total wage and leave cash on basic; here it is exactly the reverse.
Your documents and your route: ask for the service certificate (Article 62) — free, and it states the two dates, the work and the wage. At final departure the employer must repatriate you to your country (or an agreed country) within 60 days of the contract's end and, on request, give you a clearance of obligations (Article 14); a worker suing for his dues may remain in Oman until the case is decided. And claiming (Article 9): start at the Ministry's competent settlement division (up to 30 days); if settlement fails, the division refers the dispute to the competent court within 7 days — and your right to claim lapses one year from the date the right fell due. That one year is the most practically important number on this page after the gratuity rates themselves.