The Basic Features Of Asiabiz Services Singapore Employment Act

In Singapore, the procedure for incorporating a company is generally simple and straightforward, and requires only a few legal steps and obligations compared to other countries around the world. In Singapore, companies are governed by the Singapore Companies Act of 1963. The necessary steps and structure for forming a company in Singapore are covered by this Act. All companies must abide by the regulations of this Act in order to legally incorporate a company within Singapore. Employees, on the other hand, are covered by the employment act, except for the following positions: Managerial, executive and confidential positions, (However, provisions for salary protection extend to managers and executives earning S$2,500 basic monthly salary and below. All other provisions are not applicable to them.), domestic workers, seamen, any person employed by a Statutory Board or the Government.

Through this guide, you will be informed of the statutory requirements under the Singapore Employment Act and the common practices applied to employment contracts, wages, and benefits when hiring employees in Singapore. However, this guide does not discuss about specialized industries involving manual labour and blue collar workforce.

An effective compensation and employee benefit plan rewards and recognizes the best company employees. Through successful employee benefits strategies, productivity is raised, employee retention is increased, and creates a positive impact on the bottom line. It is often difficult for small-to-mid-size companies (SMEs) in Singapore to match the benefits package of bigger companies. It is imperative that a small company offers a benefits package that meets employee needs and is competitive with what other SME companies offer.

The relationship between employer and employee in Singapore is regulated largely by the contract of employment between them. Subject only to the Employment Act and certain limits, parties can freely enter into contracts of employment. Not all employees are covered by the Singapore Employment Act. Only those employees specified under the Act are covered.

The Act defines Managerial & Confidential Positions as those a person 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.

Moreover, Part IV of the Employment Act provides additional protection (concerning Rest Day, Hours of Work and Overtime, Public Holidays, Annual Leave, Sick Leave, Retrenchment Benefits, Retirement Benefits, Annual Wage Supplement and other variable payment) for employees earning below SGD 2000/month.