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Company Formation Singapore



Employment Contract in Singapore

Updated on Monday 18th December 2017

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The employment contract defines the relationship between an employer and an employee in Singapore. Employment in Singapore is regulated by the Employment Act. However, the Employment Act in Singapore only applies to certain categories of employees. The conditions of an employment contract can be negotiated between parties but it will be subject to the provisions of the Employment Act and will also have certain limits.

Our company formation specialists in Singapore can offer more information on the employment legislation applicable in the city-state. We can also assist if you want to open a company in Singapore.

The application of the Employment Law in Singapore

As mentioned above the Employment Act does not cover all types of employees. Among the employees the Singapore Employment Law does not cover are individuals in managerial and executive positions, lawyers, accountants, doctors, domestic workers, and government personnel. According to the Employment Act employees earning less than 2,000 S$ per month must benefit from additional protection such as rest days, specific work hours, public holidays, paid annual leave, sick leave and certain retirement benefits.

What is a labor contract in Singapore?

According to the Employment Law, a Singapore labor contract is also referred to as employment agreement, appointment letter or offer letter. The employment contract is defined as an agreement that contains the work terms and conditions between an employer and employee. Even if oral contracts are also recognized, the written contract is the most employed type of labor contract in Singapore. The employment contract must contain certain information. Among these it must state the job title, the duration of the contract if it is temporary, the date when the employee will start working, the wage package, the timetable, the benefits (if any), a probation clause (if any), and the termination clauses. If considered important, a code of conduct can also be inserted in the employment agreement.

Hiring foreign employees in Singapore

Foreign investors interested in company registration in Singapore must be aware of the fact that there are special requirements when hiring foreign employees. The first requirement is applying for the employment visa on behalf of the worker based on the previously sent and signed employment agreement.

Apart from respecting all the provisions in relation with the employment contract, a Singapore company must also register with the Central Provident Fund (CPF) in order to pay the insurance and social contributions. Singapore companies could also include certain benefits in the labor contracts of their employees, such as private health insurance. Our Singapore company formation agents can explain the requirements of the Employment Law in terms of hiring foreign workers and the available employment permits.

Requirements of the Employment Act in Singapore

The legislation in Singapore is quite strict about employment and the rights employees have. Other requirements of the Employment Law in Singapore state that an employee’s salary must be paid at least once a month. Employees earning less than 2,000 S$ benefit from special conditions and their employment must be done under certain circumstances. They must benefit from a certain timetable that does not exceed 44 hours per week.

Other rights of employees in Singapore

Apart from the rights mentioned above, individuals working within companies in Singapore must also benefit from the following:

  • -       a minimum paid vacation period;
  • -       time off in case the employee is injured at work;
  • -       days off om public holidays;
  • -       maternity and paternity rights;
  • -       protection against discrimination and harassment;
  • -       pension benefits upon retirement.

In return, all employees have the obligation of performing their duties with care and diligence. One of these duties refers to the disclosure or misuse of confidential information which is prohibited.

For foreign investors wanting to open a business our company formation agents in Singapore will provide all the important information. You can also contact us for details about hiring personnel in Singapore.



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