ELECTIONS ESTABLISH OMAN'S FIRST WORKERS'

UNCLAS SECTION 01 OF 02 MUSCAT 000142

SIPDIS

STATE FOR NEA/ARPI (TROBERTS),DRL/IL (JDEMARIA)
STATE PASS TO USTR (JBUNTIN)
LABOR FOR ILAB/JSHEA AND HSUDHA

E.O. 12958: N/A
TAGS: ELAB ETRD PREL MU
SUBJECT: ELECTIONS ESTABLISH OMAN'S FIRST WORKERS'
COMMITTEES


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SUMMARY
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1. Assistant United States Trade Representative (AUSTR)
for Labor William Clatanoff recently met with officials
at the Oman Ministry of Manpower and the Under Secretary
of Commerce and Industry to discuss trade and labor-
related issues. While talks focused on Oman's first
elected workers' representational committees, other
meetings touched on worker rights, Omanization, labor
disputes, and Oman's adherence to core labor standards as
defined by the International Labor Organization. End
summary.

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AUSTR HIGHLIGHTS IMPORTANCE OF LABOR
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2. AUSTR William Clatanoff visited Oman on January 15 to
hold labor consultations with officials from the Ministry
of Manpower (MOM) and the Ministry of Commerce and
Industry (MOCI). In his opening remarks with Manpower
Minister Juma bin Ali bin Juma, Clatanoff stressed the
importance of furthering workers' rights in Oman as
indicative of Oman's adherence to the International Labor
Organization's Declaration on Fundamental Principles and
Rights at Work. Fourteen staff members and advisors from
the Ministry participated in the meeting, illustrating
Oman's keen interest in the labor aspects of the proposed
Free Trade Agreement.

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Omanization
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3. In subsequent talks with the Ministry's participants
from a December 14 digital-video conference on labor
issues, AUSTR Clatanoff requested more details on the
process of Omanization and its impact on foreign
corporations wishing to do business in the Sultanate.
MOM stressed the dynamic nature of Omanization, urging
AUSTR Clatanoff to consider this a flexible process in
which both the private sector and government cooperate to
create sector targets. Targets of Omanization are set
according to recommendations by Omani and expatriate
companies who sit on sector committees and determine
appropriate percentages based on negotiations,
availability of trained Omanis in various fields, and a
given sector's need for expatriate labor.


4. MOM stressed its flexibility in meeting target
Omanization rates. If a company cannot meet the target
for its sector, for instance, it may appeal to the
Ministry to negotiate its employment needs, Omani and
expatriate. MOM cited the example of Shangri La Hotels.
Unable to meet its 60% Omanization target, the company
appealed to MOM for assistance. Both MOM and Shangri La
Hotels agreed to a reduced target of 40% with a plan to
reach 60% within a specific time frame.

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Workers Representation Committees
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5. Indicative of the recent labor developments in Oman,
AUSTR Clatanoff met with 15-20 newly elected
representatives of Oman's first Workers Representation
Committees. Representing 7 companies, the participants
discussed their optimism in the development of workers
committees in Oman. According to one participant, "We,
as elected representatives, are here to make sure that
the labor law is enforced, not cheated." Another
participant went on to say that "management is much more
careful in taking decisions, knowing that employees have
the ability to take issues back to the people."


6. The group's optimism, however, was tempered with
commonly heard calls for the committees, and MOM, to take
things slow. New to the field of "unions" and
participatory labor, the representatives stressed the
time it will take for both employees and employers to
understand the function of the committees as well as for
workers to understand their rights. "We don't want to
rush in and create a problem rather than solve a
problem."


7. To date, MOM has visited 56 companies. Of those
visited, 15 have held elections for representation
committees and 7 committees have been certified from the
following firms:
Oman Refineries
Saud Bahwan Auto
OFSIT
Crowne Plaza
Galfar Engineering
Intercontinental
Grand Hyatt

Moreover, MOM intends to have the Main Committee (a
national umbrella committee) established by June.
Following its establishment, a delegation of elected
representatives will attend the 93rd Session of the ILO's
International Labor Conference later that month.


8. In an unexpected gesture, the workers' representation
committee from Galfar Engineering, one of the largest
employers in Oman, invited AUSTR Clatanoff to visit one
of the local Galfar plants. Galfar held committee
elections in December and currently has 5 worker
representatives. During his visit, AUSTR Clatanoff
observed safety and health standards, elicited opinions
on the committees, and briefly chatted with expatriate
workers, including one individual from India who has
worked for Galfar for over 17 years (starting at the
current minimum wage of USD 314 a month, he now earns
over USD 1830 a month).

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Labor Disputes
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9. AUSTR Clatanoff also met with the Manpower Ministry's
Director of Dispute Settlements, Mr. Yaqoub Ali al-
Kharboushi, who described the process of dispute
settlement in Oman as one of negotiation and
transparency. Any individual, Omani or expatriate, may
put forth a complaint with one of the six labor dispute
centers in Oman, he explained. The dispute center will
assign an arbitrator to the case. The arbitrator, in
individual meetings with the two parties, attempts to
clarify the law as it pertains to the case and make
suggestions to resolve the issues. If no compromise is
reached, sometimes after 2 or 3 hearings, both sides are
asked to submit their positions with supporting
documentation. According to Articles 106 and 107 of the
2003 Labor Law, the case is then transferred to the
appropriate court, which is typically the Court of First
Instance, with labor specialists on the bench. MOM makes
no formal recommendations to the court.


10. In his meeting with the newly appointed Under
Secretary for Commerce and Industry, Ahmed al-Dheeb,

SIPDIS
AUSTR Clatanoff took the opportunity to thank MOCI for
its cooperation and reiterate the importance of Oman's
commitments to the ILO in furthering workers' rights. Al-
Dheeb commented that in meeting ILO commitments via
representation committees, the private sector has
expressed concern about overt government protection of
employees at the expense of employers' rights. Al-Dheeb
invited AUSTR Clatanoff to meet with workers throughout
the country to hear the opinions and stories of the
expatriate workforce in Oman.

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Comment
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11. These frank discussions with workers' committee
representatives, first-hand observations of MOM's labor
clearance and employment services operations, and chats
with expatriate workers at Galfar Engineering provided
AUSTR Clatanoff with a better appreciation of Oman's
current labor practices. While issues such as the
implicit right to strike (not prohibited by the 2003
Labor Law),the role of collective bargaining with
respect to individual contracts, and Arabic language
proficiency requirements for elected committee
representatives remain contentious, MOM nonetheless
reiterated its firm commitment to improving worker's
rights and adhering to ILO core labor standards.

BALTIMORE