1.1 Key statutes
The common law is a significant source of employment law in Singapore.
Employment law in Singapore is also regulated by several statutes, including:
* the Employment Act;
* the Industrial Relations Act;
* the Trade Unions Act;
* the Trade Disputes Act;
* the Work Injury Compensation Act;
* the Retirement Age Act;
* the Workplace Safety and Health Act; and
* the Employment of Foreign Manpower Act.
Other legislation, such as the Central Provident Fund Act, Children Development Co-Savings Act and Skills Development Levy Act also imposes specific burdens and/or provides assistance to employers and employees.
The Employment Act prescribes minimum terms and conditions of employment and governs rights and obligations in relation to employers and employees (with the exclusion of seamen, domestic servants, persons working for a statutory board or the government, managers and executives).
In addition, government departments and bodies issue directives, rules and policy statements on the interpretation of the relevant statutes and regulations. Tripartite recommendations and guidelines often outline the position adopted jointly by the representatives from the employers, the employees/unions and the government.
1.2 Probationary period
There are no specific laws governing probationary periods. However, they are common practice in employment contracts. The duration can be freely agreed by the parties, but usually it varies between one and three months for lower-level employees and between three and six months for managers/executives.
1.3 Minimum wage
Singapore does not have a minimum wage provision. However, the Ministry of Manpower (MOM) is empowered to prescribe minimum wages in the case of children and young persons under the age of 16 working in particular industries.
1.4 Remuneration structure
The National Wages Council (NWC), a body comprised of the government, employers and employee representatives (usually national trade union representatives), issues annual wage guidelines which are typically taken into account during wage negotiations between employers and employees.
According to the NWC recommendations, the typical wage structure of a rank and file employee should be:
- a basic monthly wage (70%);
- an annual variable component (AVC), otherwise known as bonus (usually performance based), which may also include the annual wage supplement (AWS), commonly known as the 13th month payment (20%);
- a monthly variable component (MVC) based on the financial performance of the employer and the performance of the employee (10%).
Higher-level employees usually have a greater proportion of their wages in the form of AVC, though this is not mandatory.
1.5 Working hours
Hours of work
Regulations made under the Employment Act contain prescription in relation to working hours, overtime, rest periods and public holidays for employees covered by the Act who work part-time. A part-time employee is defined as one who is required to work for less than 35 hours per week.
Furthermore, Part IV of the Employment Act contains specific restrictions on hours of work, overtime and rest periods. However, part IV of the Employment Act is only applicable to employees whose salary does not exceed S$2,000 per month or who are engaged in manual labour (up to a salary cap of S$4,500 per month). There are no hours of work prescriptions for full-time employees falling outside of Part IV.
According to Part IV of the Employment Act:
1. An employee may not be required to work more than six consecutive hours without a break, more than 8 hours a day or more than 44 hours a week. These limits can be varied by agreement under the contract of employment; for example, the limit of 44 hours may be exceeded in one week if the number of hours worked in every alternate week is less than 44 hours.
2. However, no employee can be required to work for more than 12 hours a day, for more than 48 hours a week or for more than 88 hours in any continuous period of two weeks, except in the following circumstances:
- actual or threatened accident;
- performance of work essential to the life of the community;
- work essential for defence or security;
- urgent work to be done to machinery or plant;
- an unforeseeable interruption of work;
- work to be performed in any industrial undertaking essential to the economy of Singapore or any of the essential services.
- Specific rules are provided for shift workers, which may be required to work up to 12 hours a day, provided that the average number of hours worked over any continuous period of three weeks does not exceed 44 hours per week.
Overtime
For employees covered under Part IV of the Employment Act any work done in excess of 44 hours (or 48 hours if agreed in accordance with the Act) is considered overtime. The maximum permitted overtime is 72 hours per month, but the MOM can grant extensions to this limit. Overtime hours must be paid at least 1.5 times the basic hourly rate of pay. In case of work during a rest day at the request of the employer, the employee is entitled to be paid up to 2 times the basic rate of pay.
Rest periods
Employees covered under Part IV of the Employment Act are entitled to one whole rest day each week. The rest day may be on Sunday or any other day as fixed by the employer by way of a contract or monthly roster. For shift workers, the rest day may be any continuous period of 30 hours.
1.6 Public holidays
Every employee covered by the Employment Act is entitled to a paid rest day on public holidays. Currently there are 11 gazetted public holidays per year. The employer and employee may agree to substitute another day for any of the prescribed public holidays. The employee who is required to work on a public holiday must be paid an additional day’s salary at the basic rate of pay on top of his gross rate of pay for that day. Special rules apply to part-time employees. No statutory entitlement applies to those employees who are not covered by the Employment Act; however, it is common practice to grant the same paid rest days to these employees as well.
1.7 Annual paid leave
The statutory entitlement to paid annual leave applies only to employees covered by Part IV of the Employment Act, and to part-time employees whose employment is covered by the Employment Act.
Part IV employees who have served an employer for not less than 3 months are entitled to 7 days’ paid annual leave during the first 12 months of service and an additional 1 day of annual leave for every subsequent 12 months of service, up to a maximum of 14 days. Annual leave entitlements may be forfeited if the employee absents himself from work without the employer’s consent or without reasonable excuse for more than 20% of the working days on which his annual leave entitlement is based.
Part-time employees are entitled to annual leave on a pro-rata basis, calculated in accordance with the legislation.
1.8 Other types of leave
Sick leave
For all employees covered by the Employment Act and with at least 3 months’ service with the employer, paid sick leave up to 14 days’ per year must be provided. Where hospitalisation is necessary, the 14 days’ leave can be extended up to 60 days. Employees not covered by the Employment Act do not have any statutory sick pay entitlement, but many employers choose to grant all their employees sick leave according to the Employment Act standard.
Maternity leave
The maternity leave provisions in Singapore are complex. A female employee’s entitlement to maternity leave may vary between no legal entitlement at all, up to an entitlement to 16 weeks leave on full pay, depending on her circumstances. Government reimbursement of some maternity leave payments may be available to employers in particular cases, pursuant to the Children Development Co-Savings Act.
Paternity leave
There are no statutory provisions regarding paternity leave. Commonly, limited paternity leave is granted to male employees under employment contracts, collective agreements or company policies.
Childcare leave
Employees (both male and female) who are covered by the Employment Act and who have at least 3 months’ service and a child younger than 7 years of age are eligible for 2 days of paid child care leave each year. In addition, married employees with a Singapore citizen child under the age of 7 are entitled to an ‘enhanced’ child care leave benefit, which extends the entitlement to up to 6 days’ paid leave per annum. Government reimbursement of some childcare leave payments may be available to employers in particular cases, pursuant to the Children Development Co-Savings Act.
Infant care leave
Married employees with at least 3 months’ service who have a Singapore citizen child under the age of 2 are also entitled to 6 days’ unpaid infant care leave per annum. The paid childcare leave entitlement should be exhausted first.
Military leave
An employer must grant unpaid leave of absence to any employee required to report for national service, mobilized service or voluntary service.