In Singapore, the comfort and well-being of employees is considered a top priority! The Ministry of Manpower provides for multiples regulations and Acts, including Singapore Employment Act to allow corporates to look after the welfare of their employees.
The Act calls for the creation of an official contract under which every single benefit that an employee can garner from their employer shall be listed out. A properly crafted out contract can act as a successful determinant of the credibility and productivity of not just the employee, but also the employer. It brings out the corporation in a good light.
What is the Singapore Employment Act?
Singapore Employment Act is the pristine Singapore Labour Law, governed by the Ministry of Manpower. The Act provides basis for all terms and conditions that apply to the employees in SIngapore.
The Act covers all the employees hired by an employer under a legal contract of service. It covers both local and foreign employees, engaged in any of the following terms of services –
- Full time
- Part time
- Contract based
The employees under the Act can be paid in any of the following manners –
- Hourly basis
- Daily basis
- Monthly basis
- Piece rated basis
The Act, however, does not cover the following services –
Executive or a Manager with a monthly salary of more than S$4,500
- Domestic workers
- Statutory board member/employee
- Civil servant
How does the Act benefit the employer?
If an employer is keeping in mind the principles and guidelines of the Act and providing all the benefits mentioned, the employer automatically capture the attention of all the consumers, the stakeholders, potential investors, financial and tax institutions and other regulatory authorities.
Offering employee benefits is therefore beneficial for the employers as well.
Employers should strive to provide employees with different competitive benefits, no matter how small. This way, the organization operates and functions better, the human resources are satisfied and happy, and the overall business goals are met easily and quickly.
Importance of Employment Contract in Employee Benefits in Singapore
An employee contract holds a significant place when it comes to the benefits of the employees in Singapore.
An employee contract is a legally binding agreement between an employee and their employer, defining all the terms and conditions and benefits the employees can realise from the organization upon hiring and later. Employment Contract majorly features the following aspects:-
- The job profile and position of the employee
- The duration of employment, specifically if they are hired on a contract basis
- The date of recruitment
- Working hours
- Remunerative details
- Benefits the company provides to the employee
- Duration of probation period
- Details about termination and related notice
- Code of conduct
There are plenty of benefits that an employee gains from the Singapore Employment Act. Some of the major benefits are as follows –
As per the provisions of the Employment Act, employees are offered with at least 14 days of paid on an annual basis. However, these leaves are only available to people who have managed to serve the corporation for at least three month. In the first year of service, the number of such leaves is limited to 7.
Employees are entitled to sick leaves, if they fulfill the following criteria –
- They have served the company for a minimum of three months
- They have already informed their absence within 48 hours
- Their medical leave is approved by a certified Doctor/dentist/medical practitioner in Singapore
The total number of sick leaves an employee can take depends on their duration of service with the employer. Employees who have worked for at least three months can be provided with at least 5 medical leaves and 15 hospitalization leaves.
- Maximum number of medical leaves – 14 days
- Maximum number of hospitalization leaves – 60 days
A female employee is entitled to 16 weeks of paid maternity leave; whereas male employees are entitled to 1 week of paid paternity leave. Fathers can also share one week of their spouse’s 16 weeks of maternity leave. This is only possible if the following conditions are met-
For mothers –
- They are lawfully married to the father of the child
- Child is a legal citizen of Singapore
- The female employee has served the employer for at least 90 days before child birth
- The female employee has not lost her source of income during the duration of maternity leave
Women are entitled to only 12 weeks of maternity leave in the following cases –
- The female employee is a single mother
- The child is not a legal citizen of Singapore
- The parents are foreigners but working in Singapore (full-time/contract basis)
For fathers –
- Lawfully married to the mother of the child
- The child is a legal citizen of Singapore
- The child is born on or after May 1st, 2013
- The male employee has served their employer for at least 90 days before child birth
- The male employee has not lost his source of income during the duration of paternity leave.
Pensions and fund contributions
The Employment Act does not call for any requirement on behalf of the employer to pay pensions and other retirement benefits to the employees, unless it is already stated in the Employment Contract.
But an employer in Singapore shall make monthly fund contributions to his employees’ accounts, also known as the Central Provident Fund contribution. Such contribution can only be made to the accounts of employees who are Singaporean or are permanent residents of Singapore. In addition to this, the employees must also earn a minimum of S$50 per month.
The contributions shall be done within 14 days from the end of a month as per the appropriate rates provided by the CPF Act.
In cases of employees with Singapore Employment Pass, Entrepreneur Pass or Temporary Work Permits, no CPF contributions shall be made.
Self employed SIngapore citizens can make CPF contributions on a voluntary basis.
Incentives and bonuses
Many organizations in Singapore offer their employees with multiple benefits, like monetary incentives and variable bonus payouts. This is done primarily to retain as well as attract talent towards their organization.
There are three major kinds of incentives employees get in Singapore –
- Variable payments
AWS – Annual Wage Supplement, also known as the 13th month bonus. AWS is paid by the organization to supplement an employee’s annual wage.
Variable Payments – Organization pay out their employees with appropriate rewards in order to enhance organizational productivity and success.
If clearly stated in the terms of contract of employment, employers are legally obligated to pay such incentives.
All Singapore employees are provided with 11 paid public holidays every year.
The following are those 11 public holidays –
- Chinese New Year (2 days)
- New Year’s Day
- Hari Raya Puasa
- Hari Raya Haji
- Labour Day
- Good Friday
- Vesak Day
- National Day
- Christmas Day
Employees are entitled to a 6 days unpaid infant care leave and a 6 days paid childcare leave on an annual basis, irrespective of the number of children.
For availing the same, following conditions are supposed to be fulfilled –
- The child should not be older than 7 years in age in case of childcare leave
- The child should be less than 2 years in age in case of infant care leave
- The employee has served the employer for at least three months
- The child is a legal citizen of Singapore
- The parents of the child are legally married
The expenses for the first three days of childcare leave will be borne by the employer and the expenses for the last three days of such leave will be borne by the Government to a maximum limit of S$500 per day.