How Oman gratuity is calculated
The 2023 Labour Law simplified gratuity to a flat rate: a non-Omani worker who has completed at least one year of continuous service receives one month's basic salary for each year of service, with fractions of a year paid proportionally. This replaced the old formula of 15 days per year for the first three years and one month thereafter.
The calculation uses the last basic salary; allowances are excluded unless the contract provides otherwise. Resignation does not reduce the entitlement. There is no statutory cap.
For service that began before 31 July 2023, some employers apply the old 15-day rate to the pre-2023 period and the new rate afterwards. Check your final settlement if your employment straddles that date.
Formula
Worked example
Basic OMR 900, 6 years: 6 × 900 = OMR 5,400.
Legal basis: Royal Decree 53/2023 (Labour Law), Article 61.
Frequently asked questions
How much is gratuity in Oman per year?
One month's basic salary for each year of service under the 2023 law, pro-rata for part years.
Did the Oman gratuity rules change in 2023?
Yes. Royal Decree 53/2023 replaced the old 15-days-then-one-month formula with a flat one month per year for all years.
Do I need one year of service to qualify?
Yes — one year of continuous service is the minimum. After that, part years are paid proportionally.
Is gratuity reduced if I resign in Oman?
No. The full accrued amount is payable on resignation.
Do Omani employees receive gratuity?
No. Omanis are enrolled in the Social Protection Fund (formerly PASI) with employer and employee contributions instead of a lump-sum gratuity.
Does the law apply in Oman free zones?
Yes. Duqm, Sohar and Salalah free zones follow the national Labour Law for end of service.