Asiabiz Singapore Employment Act Guide And The Essential Features

The Singapore Employment Act is the principal governing law for employment regulations and standards in Singapore. It cover practices including, but not limited to,employment contracts, wages, and benefits when hiring employees in Singapore.

In Singapore, employer-employee relationships are largely regulated by contracts of employment. Contracts of Employment may also be known as Employment Agreement,Appointment Letter, or Offer Letter. It is an agreement between an employee and employer that specifies the terms and conditions of employment. The Singapore Employment Act provides certain limits as to the terms to be included in contracts of employment and provides the minimum standards of employment to be followed. It covers all kinds of employees, except the following:

* Managerial & Confidential Positions. An employee who has direct authority or influence in the hiring, firing, promotion, transfer, reward or discipline of other employees; or the main duties involve management and running of the business; or the employee has access to classified information relating to terms of employment of other employees, or financial positions, business operations/trade secrets of employer, is considered who holds a Managerial and/or Confidential Position.
* Domestic Workers
* Seamen
* Most of the Government Staff

Moreover, employees earning below SGD 2000/month are provided additional protection by the Employment Act regarding Rest Day, Hours of Work and Overtime, Public Holidays, Annual Leave, Sick Leave, Retrenchment Benefits, Retirement Benefits, Annual Wage Supplement and other variable payment.
The basic features of the Employment Act includes the following:

Wages, Bonuses & Benefits
The Employment Act does not provide for a minimum salary to be given to a certain employee. Thus, the minimum salary is subject to negotiation between the employer and the employee. However, the salary must be paid at least once a month within 7 days after the end of the salary period while overtime pay, if applicable, must be paid within 14 days of the stipulated salary period. The Singapore Employment Act does not require for the payment of a bonus.
Employee benefits are also known as fringe benefits or perks. These are additional compensations given to employees on top of their basic salaries. Employee benefits in Singapore include, but not limited to, sick leave, annual leave, maternity leave, incentives & bonuses, relocation assistance; healthcare benefits, retirement fund contributions, housing allowance, allowance for childrens education, childcare benefits, and transportation reimbursements.

Hours of Work & Overtime
Provisions for Hours of Work & Overtime are contained under the Singapore Employment Act only for employees earning below SGD 2000/month. Covered employees under the Employment Act are entitled to work not more than 44 hours per week and not more than eight hours daily. Also, employees cannot work for more than 6 hours without a break. Except under certain circumstances, employees cannot work more than 12 hours per day inclusive of overtime work. These certain circumstances include, but are not limited to an actual or threatened accident, work that is essential to national defence or security, or unforeseeable circumstances which leads to work being interrupted. On the other hand, shift workers are not allowed to work more than 12 hours daily under any circumstance. A one day rest day is entitled to every employee and this is considered a paid rest day. The longest possible interval between 2 rest days is 12 days.

Public Holidays
Public holidays are recognized in Singapore due to the multi-cultural diversity in the country. These public holidays include New Years Day, Chinese New Year, Good Friday,Labour Day, Vesak Day, National Day, Hari Raya Puasa, Deepavali, Hari Raya Haji, and Christmas Day.
For employees earning less than SGD 2000/month, the Employment Act of Singapore provides that you are entitled to get public holidays off, although they may be substituted by any other day subject to mutual agreement between you and your employer. In the event that a public holiday falls on a Sunday, or rest day, the following Monday shall be considered a paid holiday. Likewise, if the public holiday falls on a day when you are not contractually required to work, you shall be either compensated with an extra days pay or given an extra day off as a substitute.

Annual Leave
For employees earning less than SGD 2000/month, you are qualified to apply for annual leave if you have served at least 3 months with your employer. The duration of annual leave depends on the employment contract you have entered with your employer. However, the Employment Act provides for a minimum of seven days during the first year and one extra day for each additional year of service.

Sick Leave
An employee earning less than SGD 2000/month is entitled to 14 days of sick leave per year, and 60 days of hospitalization leave (inclusive of the 14 days) provided the employee has worked for at least 6 months for the company.

Health Insurance
The Employment Act does not require employers to provide private health insurance benefits to employees in Singapore. However, working professionals who are Singapore citizens or Permanent Residents are automatically provided with a low-cost medical insurance called Medishield. And as part of making contributions to the employeesretirement fund called CPF, a certain portion of the contribution is automatically allocated to the employers Medisave account.

Maternity and Childcare Leave
Female employees except for those in managerial and executive positions that have been employed for more than 6 months are eligible for paid maternity leave benefits. A total of 16 weeks maternity leave are given to eligible female employees. Besides maternity leave, the eligible female employees are entitled to 6 days childcare leave per year, if they have worked for the employer longer than 3 months, and are the parent of a child below 7 years of age.

Employment Termination
Either party can terminate the employment contract by giving a written notice or by paying salary in lieu of notice to the other party. The number of days for the notice period is not provided by any statutory requirement. Instead, the notice period depends on the stipulations on the employment contract. The employment contract can be terminated by either party without notice if the other party is in willful breach of the contract.