Employment Relationships: Problems & Perspectives, Labor Unions in the Sultanate of Oman - Case Study Example

Employment Relationships: Problems & Perspectives Name Course Name and Code Instructor’s Name Date Introduction Employment relationships are legal concepts broadly utilized in many countries across the globe to refer to the association between an employee or the workforce and the employer, who the employees works for under particular conditions in order to acquire remunerations in return as supported by ILO (2003). Through employment relationships, reciprocal accountabilities and rights are established between the employer and their employees and therefore, employment relationships acts as the principal driving force through which employees get access to their benefits and rights related to the employment thus, generating labour regulations and social security (Cappelli, 2008). More often than not, employment relationships are the main points of reference for establishing the scope and nature of the rights of employers and their responsibilities towards their employees. Among systems established to ensure employment relationships are effectively and proficiently maintained is trade or labour unions. Trade or labour unions are organization of employees who have joined to attain mutual goals in relation to employment such as favourable working conditions and better pays. Through its leadership, labour unions negotiate with the employer on behalf of its union members and confer with the employers regarding labour contracts (Dine, 2007). The main aim of labour unions is to maintain and enhance the terms and conditions of employment for its members such as wages, work policies and rules, procedures of handling complaints, laws guiding selection and recruitment, compensation, procedures for dismissals, occupational health and safety and workplace policies among others as echoed by Dine (2007). Despite increased pressure across the international market and business arena to employers to allow their employees to exercise their freedom to associate and join labour unions, there are countries and organizations across the globe that are yet to fully allow establishment and operations of labour unions and employees to be members of labour unions respectively. This forms the basis of this report, which seeks to critically assess the contribution of the new law that legalized establishment of labour unions, has on Omani Employment Relations by evaluating how this enactment has contributed towards better labour relations between employers and the employees since its inception. Labor Unions in the Sultanate of Oman The Sultanate of Oman is a monarchy governed by Sultan Qaboos bin Said al-Said, who has remained the prime minister and the Chief of Staff since the seventies (ITUC). In the year 1996, the Sultan gave a royal decree, which created the Basic Law to be used, by the country. Apart from creating a bicameral legislature, the Basic Law elucidates rules of succession and civil liberties as highlighted by Hafner-Burton (2009). To the present, the Basic Law in Oman operates as the constitution (ITUC-CSI-IGB. 2007). Among laws established in the Basic Law includes the Law of Associations in Article 33 that offers citizens the right to associate. Nevertheless, associations ought to have legitimate goals and obey the rules to the constitution. A labour union in Oman must be registered with the government while the Ministry of Social Development must consent. Its formation and its by laws although owing to vague wording used in the law guiding NGOs and the unwillingness to permit NGOs to operate freely in Oman by the government, numerous labour unions are kept for long durations of time once they apply for licenses (ITUC). Prior to the year 2006, labour unions were prohibited. In 2006 however, the government promised to review labour regulations as part of a free trade contract entered by Oman with the United States. The promise resulted in a royal decree issued the same year with the ruler amending Labor Law that permitted establishment of Sultanate’s General Labor Union (ITUC-CSI-IGB. 2007). Since then, numerous labour unions have been established. Be it as it may, the country is yet to fully ratify ILO convention 87 and ILO convention 98 that deals with the right to associate and safeguarding the rights to organize and the freedom to organize and collective bargaining convention respectively as supported by ITUC-CSI-IGB (2007). The Labor Law has generated immense progress in terms of employment relationships where employers are now more accountable for their employees and are increasingly under pressure to adhere to the terms and conditions of the contract. On the other hand, employees are bound to obey the terms of the contract and at the same time, they are in better positions now to negotiate their contracts and acquire better conditions in terms of wages, workplace environment, compensations and safety. An improvement made by the Labor Law towards improving employment relationships is that now employees in Oman have the right to establish labour unions which was previously impossible to do since only representation committees were permitted to do so (ITUC). The new law removes the requirements for labour unions to inform the government one month before of meetings held by the union and requirements that union leadership must be competent and proficient in spoken and written Arabic. According to ITUC-CSI-IGB (2007), employers within the new law are prohibited from reprimanding and sacking employees for activities carried out by the union of which the employee is a member. An improvement to previous situations, the new law authorizes the establishment of more than one labour union per organization. The 2006 royal decree that authorized collective bargaining and holding of peaceful strike actions by employees has allowed employees to negotiate for better wages and working conditions which are often met by the employers owing to pressure from the unions, that (wages and working conditions) could only be established by law or through individual contracts. The new law indicates that peaceful strikes must be supported by the majority of the labour force, this helps in ensuring that strikes are held for genuine reasons and that they are not used to advance the interests of a few. ITUC-CSI-IGB (2007) notes that although the Law has generated immense advantages for both the employee and the employer, there still exists some loopholes such as, the Ministry of Employment can decide not to register a labour union if the labour union fails to persuade it that all prerequisites are met. In addition, there are group of employees that are not included in the Labor Law, which includes domestic employees, armed forces, security personnel and government employees as argued by ITUC. There are major restrictions in the labour industry in regards to the enactment of the law with migrant workers who make up majority of the workforce in Oman remaining vulnerable. The government still has a strong hold on the operations of labour unions with establishment of only one federation of unions, which does not comply with the ILO Convention 87. The enactment of the law has seen more and more employees associate and join labour unions with the view of capitalizing on the power of collective bargaining. Be it as it may, the fact that labour unions do not freely operate, as in the case of economies in the West, employees in Oman are yet to achieve their other fundamental rights (ITUC). The Labor law does not provide for favourable workplace conditions particularly about minimum wages, working hours and occupational health and safety. Employees do not have any legal right to remove themselves from work conditions that are unsafe and still maintain their positions and legislation safeguarding the employee’s right not to work above the maximum hours as per the law are still not fully enforced (ITUC-CSI-IGB. 2007). Presently, there are no clauses for minimum wages for some job categories. Although employees are permitted to hold peaceful strike actions which have approval and knowledge of the government three weeks prior, the number of days an employee engages in strike actions are considered part of the working days and are therefore calculated as days not worked thus, payments are deducted accordingly as indicated by (ITUC). The fact that the law stipulate that a union must have a minimum of twenty-five workers despite the size of the organization indicates that employees in small companies are cut off from associating despite the enactment of the law. Conclusively, the employment relations in Oman although they have improved somewhat, there is a lot yet to be done especially in ensuring ALL fundamental rights of employees are safeguarded and upheld (Khan, S.A. 2011).. For instance, unions should not be denied licenses by the authority on reason of arbitration and the right to participate and carry out a strike should not be restricted by compulsory conditions. Not all activities carried by the unions should be monitored and controlled by the government, as is the case presently while there should be more than one federation of unions to safeguard against the negative effects of monopolization and ensure objectivity, reliability, credibility and ensure the federation is not arm-twisted by the government (ITUC). Freedoms to associate are fundamental basic rights for all workers and therefore, should not be a preserve for some employees while allowing other employees to remain vulnerable. Although Omanization will ensure more and more Oman citizens are engaged in the labour industry, the rights of expatriates and migrant employees should be safeguarded and upheld and ensure they are not vulnerable as discussed by Khan (2011). Presently, the employment relationship between the employer and migrant or expatriate workers is biased with the employer having all the powers to hire and fire and leaving very small room for the expatriates to negotiate for better terms and conditions in their workplace. The employment relationship in Oman can significantly be increased by further ratifications of the ILO labour conventions that are yet to be ratified by the government such as ILO conventions 87 and ILO conventions 100 among others and implementation and compliance with all decisions of ILO, of which Oman is a member (Khan, 2011). Similarities and differences of employment relations in Oman According to ILO (2006), varied national labour laws have provisions on employment relationship especially in relation to scope. Although, there are certain similarities, not every national labour law offers comprehensive or equal coverage of employment relationship with some provisions addressing regulation of employment contract as a definite contract. While other provisions being intended to establish the existence of employment relationship and stipulate administrative and judicial system for monitoring adherence and enforcement of legislations as highlighted by Angel-Urdinola & Kuddo (2010). Primarily, employment relations establishes a legal connection between the employee and the employer, for whom the gain of work is carried out in return for payments, under certain requirements created by the labour law and practice (ILO, 2006). Angel-Urdinola & Kuddo (2010) argues that the labour law regulates relations between the employee and the employer and between the representative firms and unions with the employer’s associations. In Oman and across the Middle East, the enactment of the labour law only offers a set of minimum legal conditions, which employers and employees ought to comply with in their employment relationship during the employment duration as discussed by Budhwar & Mellahi (2006). Across the Middle as is the case in Oman, the Labor law is inter alia, structured to even out the bargaining power between employers and employees (Khan, 2011). Nevertheless, the employment relations in the Middle East are still in their infant stage of development compared to employment relations in countries such as the United States and major European countries such as the United Kingdom and Germany. The employment relationships are so much advanced in the western world such that employees are fully safeguarded from arbitrary, un-objective and discriminatory actions by employers while dealing with possible market failures generating from inadequate information against risks. For example, in the United Kingdom, protection of employees, which was once perceived to be facilitated by collective bargaining reinforced by public policy, is now increasingly designed in terms of individual legal rights, implementable before judicial forums like employment tribunals as reported by Dickens & Neal (2006). The change from reliance on collective bargaining to ensure employment protection to individual legal rights has generated considerable changes to the employment relationship landscape. Although employment relationships in Oman and majority of countries in the Arab world have been rigid and has favoured the employer. Recent changes globally has seen employment relationships in these countries improve for the better as governments in the said countries are constantly under pressure from its population and the international community to bring its labour laws into a closer alignment with the international standards (Hafner-Burton, 2009). For instance, were it not for the insistence and hard lining by the United States, the employment relationship in Oman would be non-existent as argued by Hafner-Burton (2009). According to Budhwar, & Fellahi, (Eds) relations in GCC countries are greatly collectivist within in-group and very individualist with out-group. In regards to employer-employee relationship in these countries are based on morals and the management style is more often than not directive and paternalistic. Budhwar & Fellahi (p. 56) suggests that employment relations within Omani are no different from the rest of Gulf States in regards to hierarchical value orientation and Omanis enjoy increased rates of hierarchical authority especially in workplaces since boundaries are clearly drawn between the employer and the employee. Although there are still issues that are yet to be addressed by the new labour law in the Sultanate of Oman in regards to improving the employment relationships in the country, the country has made considerable steps towards employment protection. Conclusion As described in the report, employment relationships are legal concepts broadly utilized in many countries to refer to the association between an employee or the workforce and the employer, who the employees works for under particular conditions in order to acquire remunerations in return. Employment relationships are essential in striking a balance in regards to the rights and obligations of both the employee and the employer. Following the 2006 royal decree that saw the establishment of labour law that authorizes establishment of labour unions in Oman, the scope and nature employment relations in Oman has significantly changed with both employees and employers having equal opportunities to negotiate the terms and conditions of employment contracts. To ensure that employment protections are comprehensively implemented and achieved, the government in Oman needs to fast track amendments and review issues that still impede on the fundamental basic rights of workers. Among issues that need addressing including allowing unions to freely operate, eliminating compulsory conditions on strike actions and allowing establishment of more federations of unions and ensuring workers not previously covered by the law such as expatriates, domestic workers and armed forces among others are effectively and efficiently safeguarded and taken into consideration. References Angel-Urdinola, D.F. & Kuddo, A. 2010. Key characteristics of employment regulation in the Middle East and North Africa. The World Bank, Accessible from http://siteresources.worldbank.org/SOCIALPROTECTION/Resources/SP-Discussion-papers/Labor-Market-DP/1006.pdf Budhwar, P. & Mellahi, K. (2006). Introduction: managing human resources in the Middle East. In Budhwar, P. & Mellahi, K. (Eds.) Managing Human Resource in the Middle East. London: Routledge, pp. 1-19. Budhwar, P.S. & Mellahi, K. (Eds). Managing Human Resources in the Middle. Upper River Saddle: Routledge. Cappelli, P. 2008. Employment Relationships: New Models of White-Collar Work. Cambridge: Cambridge University Press. Dickens, L., & Neal, A.C. 2006. Changing Institutional face of British employment relations. London: Kluwer Law International. Dine, P. 2007. State of the Unions: How Labor Can Strengthen the Middle Class, Improve Our Economy, and Regain Political Influence. London: McGraw-Hill Professional. Hafner-Burton, E. 2009. Forced to Be Good: Why Trade Agreements Boost Human Rights. London: Cornell University Press. ILO. 2003. The scope of the employment relationship. Report V, International Labor Conference, 91st Session, Geneva. ILO. 2006. The employment relationship. International Labor conference, 95th Session. Accessible from http://www.ilo.org/public/english/standards/relm/ilc/ilc95/pdf/rep-v-1.pdf ITUC. Internationally recognised core labour standards in the sultanate of Oman. Report for the WTO general council review of trade policies of the sultanate of Oman (Geneva, 25 and 27 June) Accessible from http://www.ituc-csi.org/IMG/pdf/TPR_Oman.Final.pdf ITUC-CSI-IGB. 2007. 2007 Annual survey of violations of trade union rights: Oman. ITUC-CSI-IGB. Accessible from http://survey07.ituccsi.org/getcountry.php?IDCountry=OMN&IDLang=EN Khan, S.A. 2011. Convergence, divergence or Middle path: HRM Model for Oman. Journal of Management Policy and Practice, vol. 12, no. 1, pp. 76- 87 Read More