Monday, June 29, 2009

Focus on: Labor Unions

In 2006, an amendment to the Labor Law was issued that permits the establishment of trade unions in Oman. Since then, the number of labor unions in Oman has steadily increased. Currently, there are more than 55 labor unions across the Sultanate according to the General Federation of Oman Trade Unions (GFOTU). This represents a dramatic increase over 2007 and 2008 levels.

Trade unions are organizations of employees that work together to achieve common goals. In Oman, trade unions may work to defend employee rights, improve financial and social situations, and represent employees in work-related matters. The trade unions have also formed the GFOTU, which is an independent body that oversees labor unions in Oman established under the new law, and which promotes labor rights and the interests of unions.

As the number and visibility of labor unions increases in Oman, there are several issues for employers and employees to consider.

Employers should make themselves aware of the laws and what actions are permitted and prohibited with respect to trade unions. For example, it is unlawful for an employer to terminate an employee based on the employee’s membership or role in a trade union. In addition, employers may be subject to fines or imprisonment if they interfere with an employee’s right to carry out trade union activities.

Conversely, employers may look to trade unions as a resource for facilitating communication between the employer and the employee. Trade unions have the advantage of organization, which means an employer can communicate information about company policy, safety matters or other work matters to the union, which can disseminate this information to all employee members.

Employers have taken different approaches to the increase in labor unions in Oman. Some employers, seeking to gain the communication and policy benefits of labor unions, have actually sought to help employees form labor unions. Other employers have taken a more passive approach and waited to see the impact of the labor unions rather than actively promoting their formation.

Similarly, employees should consider the legal requirements for forming a union, as well as the rights and restrictions associated with trade unions under Omani law. For example, while trade unions have the right to bargain collectively or engage in peaceful strike action in order to improve their financial or employment situation, there are limits on what actions the employees may take. Specifically, employees planning to engage in a peaceful strikes must notify the employer at least three weeks prior to the date of the strike. Further, employees working at establishments that provide basic services to the public are not permitted to strike.

With the rapid increase in labor unions in the Sultanate, employers and employees should consult the law before taking any steps to form a union or before setting union-related policy. While labor unions can provide substantial benefits to both employers and employees, it is important to ensure that the correct laws and regulations are followed in order to achieve the maximum benefits.