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Singapore – Update On Employment Act And “Sing Core” Policy.

30 April, 2013

 

Legal News & Analysis – Asia Pacific – Singapore – Labour & Employment

 

In March 2013, Singapore’s Manpower Ministry (MOM) announced key changes to the Employment Act and employers’ responsibilities under the “Singaporean Core” policy. 

 

Employment Act (EA) amendments 


The EA sets out basic employment terms for employees who are deemed to require protection, traditionally, non-managerial, non executive employees (EA Employees) and workmen. Professionals, managers and executives (PMEs) earning not more than S$4,500 are also covered for salary protection. 

 

The EA will be amended effective the first half of 2014 to cover more workers and to provide better protection: 

 

 

  • PMEs earning up to S$4,500 will now be generally protected by the EA, including redress unfair dismissal provided they have served the same employer for at least 1 year. Instead of payment for working on public holidays, PMEs may by agreement be given time off, or failing agreement to at least half a day off. 
  • The monthly salary cap for EA employees who enjoy working hours protection will increase from S$2,000 to S$2,500, except for overtime claims for which the cap will be S$2,250. 
  • Transferred employees will have their collective agreements apply for at least 18 months, or until the agreement’s expiry date, whichever is later. 
  • Employers will be exempted from paying for employees’ sick leave and medical examination expenses for cosmetic treatment which is not medically necessary. 
  • Employers must provide written payslips and maintain employment records for all employees. 
  • Employers’ deductions for accommodation, amenities & services will be capped at 25% of monthly salary. 
  • Employees with less than 2 years’ service will not be entitled to claim retrenchment benefits, reduced from the current 3 years’ service threshold. (Those who meet the service qualification may negotiate for retrenchment benefits, but there is still no statutory entitlement to such benefit.) 


Singaporean Core 


The “Singaporean Core” policy was announced at the end of 2011. The policy requires employers to make reasonable efforts to attract and develop Singaporeans for jobs on merit. Employers are not expected to choose a Singaporean regardless of merit. However, companies in Singapore should aim to grow the Singaporeans in their workforce. 


Three areas of concern have been identified for attention: biased hiring practices in which managers have a preference for candidates of the same nationality for reasons irrelevant to job performance or competence; convenience of overseas hiring over investing in a recruitment search for local job candidates; and competition from foreign qualified candidates willing to work for lower wages than local junior to mid-level PMEs. 


The practical impact for employers is that complaints of biased employment practices will be investigated by the Tripartite Alliance on Fair Employment Practices (TAFEP) and if it finds issues of concern, TAFEP will refer the matter to MOM. MOM may suspend work pass privileges of recalcitrant employers. In addition, work pass requirements will continue to tighten in numbers and qualifying criteria. MOM will ensure that the proportion of foreign workforce to total workforce does not increase significantly beyond one-third. 

 

  

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