Business

How to Hire Employees in Singapore

In Singapore, after you set up your business, you need to hire employees to help you operate the business. In other words, the phase of getting workers is a crucial one because it entails detailed decision-making to ensure you are on the right track.  Therefore, the process has laid out legal rules and regulations which the employer and employees must put into consideration.

Employees in Singapore have excellent knowledge of their rights under the Singapore Employment Act. In addition, the Singapore Employment Act is regulated by the Ministry of Manpower (MOM). For instance, they understand what is rightfully theirs and what action they can take in some different instances. For this matter, as the employer, you need to learn about all the legal requirements to keep your business operations safe.

Read and understand the correct procedure to take while hiring employees in Singapore.

Consider the followings on Hire Employees:

Now that you have your business ad you are searching for employees think of the following questions first.

  • What are the rules of hiring contractual, full-time, or part-time workers?
  • For instance, what legal matters related to labor do I need to consider for my business and my employees?
  • Does Singapore have any guidelines for the hiring process I should know?
  • For instance, what if I need to hire both foreign and local employees? What formalities should I follow? Do they have some restrictions on foreign employees?
  • The costs of hiring employees. In other words, are there any fund contributions or levies I should pay?
  • What other standard practices do investors in Singapore follow in case there is no statutory requirement?

If you have no answers to the above questions and have other pressing questions, this guide will give you all the details you need to know about hiring Singapore employees. You must follow detailed hiring guides and labor legislation when recruiting local and foreign employees in Singapore. This article is for the newly set-up companies in Singapore that are yet to hire workers for the first time.

Note: Where necessary, seek professional advice from the relevant authorities. This guide gives the general information which companies follow during the recruitment process.

The Employment Act Overview

The employment act document plays a significant role in the hiring process. It explains all the terms and conditions that both the employer and the employee must adhere to when hiring. It has all the responsibilities, rights, and duties of employees and employers.

The first step when searching for Singapore workers is to know whether the employment act protects your employee.

When the employee is covered with the employment act, similarly, you must consider all the terms and conditions in the document. Setting your terms won’t be of any significance to the employee.

However, when the employee is not covered in the Employment Act, the employer and the employee can negotiate the terms and conditions and agree to an employment contract. The contract protects both the employer and the employee.

Hire Employees covered by the Employment Act

There are some employees who the Employment Act doesn’t cover. They include the following.

The executives and those managerial positions. A person in such posts can hire, fire, promote, transfer, discipline, and reward hire employees. They have direct powers and influence from the authorities. They run and manage essential activities related to the business.

The employment act doesn’t cover other top professionals with adequate knowledge and education skills who carry out managerial duties. Such professions include doctors, lawyers, dentists, and accountants.

The other people who don’t use the employment act include some government staff, domestic workers, and seamen.

Note: The Employment Act applies to hire employees in various categories in terms of their monthly earnings. The group includes those earning less than SGD 2,000 monthly and those making more than SGD 2,000 monthly.

In the case of workers getting less than SGD 2,000 monthly, they have more protection in terms of

  • Retirement benefits
  • Off days
  • Working hours and overtime
  • Sick Leave
  • Public Holidays
  • Annual Leave
  • Annual wage supplement
  • Retrenchment benefits.

Features of Employment Act

Features Executives / managers Employees getting over 2,000 monthly Employees getting less than 2,000 monthly
Max working hours weekly According to the contract

 

Normal activities:40 to 50 hours

According to the contract

 

Regular activities: 40 to 50 hours

44 hours
Max working days weekly
  1. According to the contract

 

Normal activities: 5 days

2. According to the contract

 

Normal activities: 5 days

Six days
Extra working time According to the contract

Usual activities: Not applicable

According to the contract 72 hours max monthly

 

Paid at 1.5 of the basic rate per hour

Features of Employment Act – CPF Contribution, Bonus & Leave

(CPFC)- central provident fund contribution for citizens from Singapore and PRs
  1. Compulsory
Similarly, compulsory Similarly, compulsory
Yearly Bonus According to the contract

 

Regular activities: equivalent to 1-4 months of salary

According to the contract

 

Expected activities: equivalent to 1-4 months of salary

Similarly, As per contract
Annual Leave; paid For instance, according to the contract

 

Typical activities: 15 days

For instance, according to the contract

 

Typical activities: 15 days

In other words, 1styear – 7 days

 

2nd year – 8 days

3rd year – 9 days

(annual increase up to a max. 14 days)

Sick Leave; paid For instance, according to the contract

 

Expected activities: 14 days per annum

For instance, according to the contract

 

Regular activities: 14 days yearly

Similarly, 5-14 outpatient days (depending upon the period of employment served)

 

Hospitalization: 15-60 days (depending upon the period of employment served)

Maternity Leave; paid if entitled 16 weeks

 

1st eight employers payable for first two confinements

Similarly, 16 weeks

 

1st eight employers payable for first two confinements

Similarly, 16 weeks

 

1st eight weeks employer payable for the initial two confinements

Annual Childcare (up to 7 years) Leave; paid if eligible Six days

 

First 3 days employer payable

Similarly, six days

 

First 3 days employer payable

Similarly, six days

 

First 3 days employer payable

Infant care (up to 2 years) Leave; unpaid if eligible Six days Similarly, six days Similarly, six days

Features of Employment Act – Public Holiday, Probation & Termination Period

Public Holidays; paid 11 days Similarly, 11 days Similarly, 11 days
Probation time For instance, according to the contract

 

Normal activities: 6 months

Similarly, according to the contract

 

Normal activities: 6 months

For instance, as per contract

 

Common practice: 3-6 months

Notice for Termination period For instance, according to the contract

 

Normal activities: 1-3 months

Similarly, according to contract

 

Common practice: 1-3 months

For instance, as per contract

 

Common practice: 1 month

Retrenchment For instance, According to the contract Similarly, according to the contract In other words, eligible to:

 

– receive a salary on the last working day

– receive retrenchments benefits

– serve the notice period

Insurance for medical For instance, according to the contract Similarly, according to the contract For instance, according to the contract

Conclusion on Hire Employees

If you have a company set up in Singapore, you need to get familiar with all the requirements. Take note of the above information and stay within the legal requirements for your company’s safety and you hire employees.

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