A Guide To Singapore's Labor Law

Singapore's Employment Act 1968 indicates the information related to statutory requirements that should be covered in the contract of service for employees. For example, it would cover the details, namely annual leave, hours of work, rest days, sick leave, etc.

In this guide, Aniday will guide you along with more details on Singapore labor law, employment contracts, and labor code provisions in detail.

What Is The Singapore Employment Law?

The Employment Act of 1968 is the primary Singapore employment law. It includes all the terms and conditions that need to be met between the employer-employee relations at work. 

The Singapore labor laws are covered under the fundamental protection law in its Employment Act. When you are hiring local employees, you should consider the terms and conditions for employment.

The Employment Act covers both local and foreign employees whether they are being paid daily, hourly, monthly, or even per piece rate basis. Aniday has compiled the various types of employees covered under the contract of service as outlined in the Employment Act:

• Full-time employees
• Part-time employees (work less than 35 hours a week).
• Temporary employees
• Contract employees

However, there are certain types of employees that the employment law doesn't cover. They include:

• Seafarers
• Domestic workers
• Statutory board employees
• Civil servants (employed by the Monetary Authority of Singapore (MAS), Accounting and Corporate Regulatory Authority (ACRA), and other statutory boards)
• Managers and executives (responsibilities include supervising or decision-making)
• Professionals having tertiary education and specialized skills (lawyers, accountants, doctors, and more)
• Independent contractors (who have their terms and conditions for their specific service)

Note: It is the best practice always to follow the Employment Act and work accordingly to avoid penalties such as a $5,000 fine, six months in prison, or both. However, the penalties may vary based on the type of violation. 

If your companies are planning to find, hire and pay remote employees from Singapore? Aniday Executive Search serivce can simplify the process with our expertise in managing Singaporean talent, making your hiring smooth and hassle-free.

What Is An Employment Contract?

The employment contract is a legal document between the employer and employee covering employment-related clauses. An employment contract is also called an employment agreement, appointment letter, or appointment offer. However, the following are the key clauses of the employment contract:

• Appointment position
• Duration of employment contract
• Employee's scope of work
• Probation clause (if there is any)
• Remuneration package
• Hours of work and overtime pay
• Employee benefits
• Code of conduct
• Notice period
• Termination

What Are The Labor Code Provisions In Singapore?

The labor code provision covers the benefits of the Employment Act, including payroll, sick leaves, annual paid leaves, maternity benefits, etc! Alongside, there are some contract conditions that the employer should follow, as discussed below:

• Minimum age: The minimum age for employment should be at least 13 years old and also differ based on the work performed.
• Minimum wage payment: The Singapore law does not have a specific minimum salary for employees, but it is based on the negotiation between the employer and the employee.
• Working hours and overtime laws in Singapore: There are specific working hours and overtime laws for Singapore employees. For example, you can only work for 44 hours per week or eight hours a day. Also, you cannot work six hours in a stretch without a break. 
• Paid annual leave: If you work for a company for at least three months, you are entitled to paid annual leave based on your length of service with the company. Check out more information on the paid Annual Leaves of Employment Act in Singapore here!
• Singapore sick leave rules: Under the statutory requirement, you can obtain paid sick leave and hospitalization leave in Singapore based on the number of months of service you have provided at the company. For example, if you worked for three months, you get paid sick leave for 5 days and paid hospitalization leave for 15 days.
• Public holidays: Based on the Employment Act, you obtain paid public holidays based on the year. For example, in 2023, employees received 14 paid public holidays. Also, if the employer compels you to work on a public holiday, they should pay an extra day's pay or a day off in lieu.
• Health insurance: Private health insurance is covered by MediShield for the citizens and Permanent Residents (PRs) of Singapore. Hence, it would cover all the expenses related to medical treatment, supplements, etc!
• Singapore's parental leave: Female employees are entitled to receive paid parental leave if they are employed for more than three months.
• Probation period: The Singapore Employment Act does not have any clauses for probation periods. However, it is appreciated that the probation period should be kept between three and six months only.
• Employment law on termination: There are some clauses related to the termination of employees. The agreement can be terminated if the employee resigns, if the project or contract is complete, or if both parties adhere to the terms of services.
• Notice period: The notice period generally depends on the terms of the contract. For example, a contract can be terminated through a written notice or paying salary in lieu at the notice. If there is a violation of the contract, both parties can determine to terminate the employment contract without notice.

Final Thoughts

In conclusion, if you are working in Singapore, both the employer and employee need to understand the labour act in Singapore, taxes and adhere accordingly. Knowing the crooks and crannies of the Act helps you follow the terms and conditions and be aware of your responsibilities and benefits.

If you need any guidance, reach out to Aniday for complete support through our Headhunting and Employer of Record services. We're here to help you with your requirements!

We hope this guide was helpful in understanding the Labor Act in Singapore effectively!