The following are some frequently asked questions that we often encounter:
I am not familiar with Singapore’s statutory requirements for new employees
Can you tell me what I need to prepare before hiring employees in Singapore?
What are the essential statutory requirements I should be aware of before bringing new employees on board in Singapore?
Statutory Requirements for New Employees in Singapore
If you're a new employee in Singapore or an employer looking to hire, it's essential to understand the statutory requirements that govern the employment relationship in the country.
When entering the workforce in Singapore, understanding the statutory and voluntary requirements for both employers and employees is crucial.
These requirements are in place to protect the rights and interests of both employees and employers. Here's a simple guide to some of the key statutory requirements:
1. Employment Contract:
In Singapore, an employment contract is a crucial document that outlines the terms and conditions of employment. It includes details such as job responsibilities, salary, working hours, and leave entitlements. While it's not mandatory, having a clear contract is highly recommended.
CPF is Singapore's social security savings plan. Both employers and employees are required to make CPF contributions. The contributions cover retirement, healthcare, and housing needs. The rates are based on age and income.
For foreign employees, obtaining the necessary work passes and permits is essential. Employers are responsible for applying for these documents, such as the Employment Pass, S Pass, or Work Permit, depending on the employee's qualifications and job role.
4. Income Tax Deductions:
Employers deduct income tax from employees' salaries and remit it to the Inland Revenue Authority of Singapore (IRAS). This ensures that employees fulfill their income tax obligations.
Employers in Singapore are required to pay the Skills Development Levy (SDL) for their employees. SDL is used to fund workforce training and development programs.
6. Occupational Safety and Health (OSH) Compliance:
Employers are responsible for providing a safe and healthy working environment for employees. Compliance with OSH regulations is mandatory to ensure workplace safety.
7. Employment Act:
The Employment Act in Singapore governs various aspects of employment, including working hours, rest days, and leave entitlements. It is applicable to most employees, except for specific groups like managers and executives.
8. Employee Handbook (Optional):
While not mandatory, many employers provide employees with an employee handbook that outlines company policies and procedures. This can be a valuable resource for understanding your rights and responsibilities within the organization.
9. SkillsFuture (Optional):
SkillsFuture is a national movement in Singapore that encourages lifelong learning and skills development. Employers can support their employees' training and upskilling through various SkillsFuture initiatives on a voluntary basis.
Some individuals and organizations choose to contribute to Self Help Groups (SHGs), which are community-based organizations that empower individuals and support community development. Contributions are typically mandatory and go toward funding SHG initiatives and projects.
Understanding these statutory and voluntary requirements is vital for both employers and employees in Singapore.
It ensures compliance with Singapore's labor laws and promotes a fair and supportive work environment.
Staying informed about any updates or changes to these requirements is essential, and seeking professional advice when needed can help navigate the intricacies of employment in Singapore effectively. 😎