--- This post was contributed to Swingvy by guest blogger Simon Hughes. ---
After you have formed a company in Singapore you will need to hire employees. These employees can be both foreign and local. When hiring the residents of Singapore (including permanent residents and citizens of Singapore) the procedure is relatively simple. But when hiring foreign employees to work in Singapore you will be required to apply for work visas, such as a Work Permit, Employment Pass, or S-Pass.
Here are some considerations to keep in mind when hiring in Singapore:
Singapore Has a Strong Employment Act to Protect Workers’ Rights
The Employment Act applies to both Singapore residents and foreign employees. The relationship between the employee and employer is almost wholly regulated by the contract inSingapore. The primary legislation for governing the employment, hiring, and dismissal of employees is placed under chapter 91 of the Employment Act. Although both employers and employees are free to place the clauses as they wish in the contract, this contract is subject to some statutory requirements under the Employment Act and normal law.
The employment contract is also termed as an employment agreement, offer letter, or appointment letter in Singapore. The definition of employee according to the Employment Act does not include seafarers, domestic workers, statutory board employees or civil servants.
EFMA Outlines The Responsibilities Related to Employment
The employment of foreigners in the city-state of Singapore is governed by EFMA (Employment of Foreign Manpower). Apart from this, some employment laws in Singapore also apply to foreigners notwithstanding the clauses included in the contract. It includes maternity benefits, compensation for workplace injuries, and childcare leave for the working parents. All foreigners wishing to work in Singapore are required to have work visas granted by the Ministry of Manpower before they begin working for an employer in the country.
Foreign Employees Must Have a Valid Pass/Visa to Work in Singapore
‘Work Permits’ are issued to the workers with basic skills from an approved country. Skill requirements depend on the sector in which the worker is going to work. The ‘S-Pass’ visa is issued to middle-level skilled foreign workers such as technicians. The most popular visa in Singapore is the ‘Employment Pass’ (EP) which applies to executives, managerial personnel, and professionals.
Hiring in Singapore without a company registered in the country is possible, however, it is a good idea to recruit the services of a corporate secretary for the process. Foreign employees must be included throughout the process.
Signing an Employment Contract is Important in Singapore
Generally speaking, the Singapore employment contract includes these things:
– Work Commencement Date
It can include the probation details as well if they are applicable.
– Details of Salary
This must include the basic pay and also the various allowances. Singapore does not stipulate a minimum wage or bonus for the employees. However, the Employment Act mandates that the salary has to be paid every month and within seven days of the end of the period. Generally, one month's salary is paid as a bonus to the employees of Singapore, known as AnnualWage Supplement, or 13th month bonus.
– Job And Responsibilities Profile
– Working Hours
The contract can include provisions for overtime if it is applicable. The provisions made by the Employment Act for the employees not working for more than 44 hours a week apply only to the person earning less than $2500 a month. (Understanding Overtime Pay Regulations in Singapore)
– Annual Leave
The minimum statutory requirement for annual leave is up to 14 working days. It applies to the workers depending on the duration of their employment. The contract can also include the ways of applying for a leave. TheManpower Ministry stipulates that the provisions for the annual public holidays are followed strictly by all the employers in Singapore. (Complete Guide to Singapore's Annual Leave Rules)
– Sick Leave
The minimum leave for sickness and hospitalisation apply to the employees coming under the Employment Act. If there are to be any sick leave without pay they should be included in the contract. The Employment Act does not stipulate requirements for providing health insurance for employees. (Guide to Sick Leave Entitlement and Eligibility in Singapore)
– Childcare And Parental Leave Provisions
The maternity provisions made for the Singapore residents are different than those made for the foreign workers. For the locals, they are16 weeks while for the foreigners this period is 12 weeks.
– Notice Period And Termination
A resignation or a termination notice must be provided in writing.
– Clauses For Confidentiality
– Laws Governing The Contract
These contracts are governed by Singapore law.
Once you are ready to hire employees for your company in Singapore, check the list of the requirements that you will have to address. It is necessary that you read the Employment Act of Singapore before you start the hiring process. If you are seeking to hire foreigners, you have to follow the rules set by the EFMA. Your employees will have to be provided with a working visa in order to start working.
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