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Singapore Employment ACT – Applicability, Contract, & Policies

The 1968’s Singapore Employment Act was the first labor legislation that controlled the interactions between the workers in an employee and recruiters. This act was majorly put into use to retain good working standards and provide a secured working space for the workers.

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singapore employment act

Overview: Singapore Employment ACT

The 1968’s Employment Act was the first labor legislation in Singapore that controlled the interactions between the workers in an employee and recruiters. This act was majorly put into use to retain good working standards and provide a secured working space for the workers. The Singapore Employment Act is valid for the whole employment procedure. From the first step of hiring an employee to its termination or dismissal.

These labor laws are not only fair but also business-friendly and efficient. As per the report of 2015’s Global Competitiveness, Singapore stands at the 3rd position in the world for having the most efficient employer-labor relations. These provisions related to employment are necessary and a major area of official compliance needs that the firms in Singapore should follow. All corporations and employers there should follow these laws while recruiting, dismissing, and managing workers.

The employer should properly decide all the terms & conditions of the work contract in agreement with the guidelines of the employment law. In this article, we will give you an elaborate idea about the main provisions of this act that any entrepreneur starting a firm in Singapore must be informed of.

Applicability Of The Singapore Employment Act

This act of employment is valid for all workers regardless of whatever nationality they belong to. This means the Singapore employment act covers both, local and foreign workers. The employment act of Singapore covers all the workers who are recruited by the employer by the employment contract with the terms and conditions. The workers that come under this act comprise part-time employees, full-time, and also temporary ones.

The rules of this act do not imply to a sole contractor who is appointed by the employer based on a fee to submit to finish a certain project for the firm. A sole contractor takes decisions and performs operations on his/her conditions.

Apart from that, below are mentioned some points which are not a part of this act:

  • Domestic employees
  • Seamen
  • Any individual working in an executive or managerial space with a monthly wage of more than $4,500
  • An individual working with or at the government or the statutory board.

The terms and conditions of those that do not come under this act are decided by coming on common grounds with their employer.

Employment Contract Under Singapore Employment Act

This act has a striking impact on the contract of employment and its structure and drafting. The Singapore employment act especially presents that any provision of the contract of employment that’s indicating injustice towards the workers is illegal and puts no legal limitations on the groups. So, this contract of employment should match the guidelines of the act.

The contract of employment is a crucial official document of a firm as it describes the interaction between the employee and the employer. The basic principles of contract law are relevant to the employment contract. All the contracts are put into action by the law, and these define the worker’s wage information, future of work, rest days, overtime payment, and leaves.

Read More: Singapore Employment Pass

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Labor Policies Under The Singapore Employment Act

There are certain promised benefits under the Singapore Employment Act. For example, maternity leaves, yearly paid leaves, paid leaves on public holidays, etc. Workers should make sure that they match all the needs mentioned in the act. There are certain provisions to which the recruiter should comply. Let’s find out what are those:

Age

A worker should at least be of 13 years to be able to apply for the recruitment. But this can also differ based on his/her work type. For instance, a worker can’t employ individuals below 16 years of age in any work area which operates in a hazardous state that can be dangerous for the individual’s health.

Salary

As per the minimum wage of workers, there are no specific details on it in the act. The salary is based on the agreed decision that takes place between the employee and the employer.

Work Hours

The general work hours of any employee are to 8 hours in a day and can extend up to 44 hours in a week. Plus, no worker should be working consecutively for 6 hours in a day, without a break. A worker should check his/her work hours mentioned in the contract of employment. It is to be noted that the work hours exclude the break for tea, rest, or meals.

Resting Days

Each employee gets at least one day off every week to rest without pay. The day of rest should preferably be a Sunday or any other weekday. If the recruiter is not able to provide a whole day off to the shift employee, the rest day for that worker should be of an uninterrupted period of 30 hours.

Public Holiday Leaves

Workers get 11 paid leaves annually for the public holidays. If the agreement states, a worker can exchange the public holiday for some other day.

Yearly Leave

A worker gets a paid yearly leave if he/she has been appointed for 3 months, at minimum. The annual leave days are based on the service years fulfilled by the worker in the company. For example, for one year’s work, a worker gets a weeks’ yearly paid leave. For 2 years of employment in the firm, a worker gets a yearly paid leave of 8 days. Similarly, for 8 or more years, a worker gets paid annual leaves of up to 2 weeks. 

But this doesn’t imply that the recruiter can’t give any extra leave to its employees. A worker can ask for leaves that extend the official limit. But the recruiter can cut the worker’s salary for such off days.

Leaves for Sickness

A worker can take sick leaves, but only if the following conditions are met:

  1. The worker should be appointed in the firm for 3 months, at minimum.
  2. The recruiter should be informed of the worker’s absence within a timeframe of 2 days.
  3. The worker has to present a certificate from a firm’s doctor or any government doctor.

The number of sick leaves, just like annual offs, is also based on the employee’s service years in the firm.

Parental Benefits & Maternity

Working mothers can seek paid maternity breaks underneath the Act, and young mothers can seek paid early childhood leaves when certain terms are fulfilled. To be eligible for such a sabbatical, a worker must have worked for at least three months. Furthermore, the baby for whom such advantages are provided by the company must be a Singaporean. These are only a handful of the requirements that a worker must meet. 

The payment for overtime labor must be paid by the company 14 days after the completion of the payment period wherein the worker completed the job. Overtime pay must not be under 1.5 times the worker’s base hourly rate.

Retirement

The Act of Retirement and Re-employment specify a statutory retirement age of 62 years. A company may not require most of its workers to retire before the age of 65. Workers who attain the age of retirement can also be employed again up until 65 years of age. Just Singapore nationals and legal residents, though, are entitled to re-employment.

Cessation

The contract of employment should specify how either party may rescind the contract. Whether the hirer or the worker can end an agreement. When there isn’t any written agreement describing the termination method, the employment act’s termination rules apply.

The employment agreement can be dismissed with:

  • Notice
  • Without Notice
  • Based on misconduct

The agreement may be terminated by either party with a formal notification. Nevertheless, both the management and the staff must adhere to the agreement’s period of notice. If the agreement doesn’t quite mention a prior notice, the Act’s time limit will be observed. If any party breaches any of the legal arrangements in a significant way, the agreement can be canceled without any formal notification.

Finally, if any worker is caught and convicted of misbehavior (such as fraud, deceit, or carelessness), an investigation should be conducted, and the worker may be terminated as a result of the findings. The Act makes no provision for a process of investigation. As a rule of thumb, though, the company must:

  1. Notify the employee about the wrongdoing
  2. Make sure that the individual hearing the investigation is not biased
  3. Provide the employee with a chance to defend his argument

According to the Act, the company may stop the worker from working for a total period of 7 days during the investigation procedure. If an employee thinks he or she has gotten wrongfully terminated, he or she may appeal the ruling with the officials in the Ministry of Manpower within 30 days of the termination.

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Conclusion

Singapore is a nation that is known for being the best place for entrepreneurs to start a company. Great transparency and business reliability are two of its most appreciated factors. The nation of Singapore also has a strong political framework with a powerful judicial system and good business governance habits. All these reasons make Singapore the greatest business hub for investors from all around the globe.

FAQ’s

10 public holidays are granted to a worker providing service in a Singapore-based firm. They are:

  1. New Year’s Day
  2. Hari Raya Haji
  3. Hari Raya Puasa
  4. Labor Day
  5. Good Friday
  6. National Day
  7. Vesak Day
  8. Christmas
  9. Deepavali
  10. Chinese New Year (2 days)

This situation is only possible when both, the company and the workers mutually decide to do it.

Yes, all employees are entitled to take sick leaves, but only when these conditions are met:

  • The service period of the worker should be at least 3 months
  • A company should be informed within 2 days of the worker’s absence
  • Present a medical certificate to the company by a medical practitioner

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