Labor Law of Singapore Essay

In Singapore, for employment to be valid there must be a contract that has been agreed upon between the employers and the employee/s. In principle, employer and employee could enter into contractual obligations without a written contract. According to Sharon Bernhardt, that Singapore is known for its thriving business economy as well according to the WEF Global Competitiveness Report, Singapore is the most competitive economy in Asia, ranking third in the world and following only Switzerland and the United States. It is a common practice in Singapore for businesses to utilize employment contracts with their employees. There are no specific guidelines for employment contracts in the Employment Act. However, a contract in Singapore typically contains information about duties, salary, work hours, benefits and termination. Employment contracts are also typically documented in writing to preserve documentation. I. The Employment Act Labour Laws in Singapore is stated through the Employment Act. As stated in the AGC Singapore site, that â€Å"the Employment Act covers every employee (regardless of nationality) who is under a contract of service with an employer†, except: a. Any person employed in a managerial or executive position b. Any seaman; c. Any domestic worker; and d. Any person employed by a Statutory Board or the Government. It is also stated that part IV of the Act, which provides for rest days, hours of work and other conditions of service, applies only to: a. Workmen earning not more than $4,500 basic monthly salaries and b. Employees earning not more than $2,000 basic monthly salaries. A. Managers & Executives under this Employment Act In Singapore, managers and executives are employees with executive or supervisory functions. These functions include the authority to influence or make decision on issues such as recruitment, discipline, termination of employment, assessment of performance and reward, or involvement in the formulation of strategies and policies of the enterprise, or the management and running of the business. They also include professionals with tertiary education and specialised knowledge/skills and whose employment terms are comparable to those of managers and executives. Professionals such as lawyers, accountants, dentists and doctors whose nature and terms of employment are comparable to executives would generally be deemed as such, and hence they would not be covered under the Act. Junior managers and executives earning $4,500 basic monthly salary and below are only covered partially on the basic payment of salary. All other provisions do not apply to them. B. The Workforce In the scope of Labor Laws of Singapore, a workman is an employee whose work involves manual labour. This includes a worker who falls under any of the following categories: a. Any person, skilled or unskilled, doing manual work, including any artisan or apprentice but excluding any seaman or domestic servant; b. Any person, other than clerical staff, employed in the operation or maintenance of mechanically propelled vehicles that transport passengers, for hire or commercial purposes; c. Any person employed to supervise any workman and perform manual work. However, this is subject to the requirement that the time spent on manual work must be more than half of the total working time in a salary period; or d. Any person specified in the First Schedule of the Employment Act, namely: i. a. Cleaners; b. Construction workers; c. Labourers; d. Machine operators and assemblers; e. Metal and machinery workers; f. Train,bus, lorry and van drivers; g. Train and bus inspectors;and h. All workmen employed on piece rates at the employer’s premises. It covers both local and foreign employees. It does not make any distinction between a temporary employee, contract employee, daily-rated employee or employee on tenured employment. For employees working less than 35 hours a week, they are covered by the Employment of Part-Time Employees Regulations, which provide certain flexibility for both the employers and employees, including the pro-rating of employment benefits, encashment of annual leave and provision of rest day. C. Wages/Salary According to â€Å"Guide Me Singapore† by Janus Corporate Solutions, the only stipulation in the Employment Act is that employees are paid in a timely manner (employees must be paid at least once a month).Thus, there is no minimum wage for workers in Singapore Many companies do give an annual bonus of an extra month’s salary, but this is not a required practice. Work hours are regulated for employees who earn less than $2,000 SGD per month. According to the Employment Act, these workers may not be required to work more than eight hours a day or 44 hours per week. They are also entitled to a break after six hours of work. Employees in management or higher positions may work more hours depending on the terms outlined in their contract. D. Hours of Work, Overtime & Rest Days As stated in the part IV of the Employment Act & Section 33 are applicable only to: a. Workmen earning not more than $4,500 basic monthly salaries; and b. Other employees earning not more than $2,000 basic monthly salaries (excluding, overtime, bonus, Annual Wage Supplement, productivity incentives and allowances). E. Maximum working hours In Singapore, an employee is not allowed to work for more than 12 hours within a day except in the following circumstances: a. Accident or threat of accident; b. Work that is essential to: i. the life of the community; ii. national defence; or iii. security; c. Urgent work to be done to machinery or plant; or d. An interruption of work which was impossible to foresee. Thus, an employee can be required to work up to 12 hours a day if the employee gives his consent in writing, after the provisions of Sections 38 and 40 of the Employment Act have been clearly explained to him. He must be informed of the daily working hours, the number of working days in each week and the weekly rest day. Employers that require their employees to work more than 12 hours (maximum 14 hours) a day are required under section 40 of the Employment Act, to apply for overtime exemption from the Ministry of Manpower. F. Break time The duration of the break(s) should be no less than 45 minutes. An employee is generally not required to work more than six consecutive hours without a break. However, if the nature of work is such that it must be carried on continuously, an employee may be required to work eight hours continuously. In such an instance, a break or breaks must be given so that the employee can have his/her meal(s). G. Normal hours of work An employee covered by Part IV of the Employment Act is not required under his/her contract of service to work more than eight hours in a day or 44 hours in a week. * The limit of eight hours per day may be exceeded when an employee is not required to work more than five days a week. However, he/she is not required to work for more than nine hours per day or 44 hours in a week. * If the number of hours worked is less than 44 hours every alternate week, the limit of 44 hours a week may be exceeded in the other week. However, this must be stated in the contract of service and is subject to a maximum of 48 hours in one week or 88 hours in any continuous two week period. A shift worker is allowed to work up to 12 hours a day, provided that the average working hours each week do not exceed 44 over a continuous three week period. If the employee’s rest day falls on a day other than a Sunday, the employer is required to prepare a monthly roster and inform him of his rest days for the month at the beginning of each month. H. Overtime allowance Overtime allowance is payable if the employee is required by the employer to work above the limit of working hours specified above. All work in excess of the normal hours of work (excluding break time) is considered as overtime work. An employee must be paid no less than 1.5 times his/her hourly basic rate of pay for overtime. Payment for overtime work must be made within 14 days after the last day of the salary period. I. Maximum hours of overtime An employee is permitted to work up to a limit of 72 hours of overtime in a month. However, this limit may be exceeded if the Ministry of Manpower has granted an exemption under section 38 of the Employment Act. Employers that require their employees to work more than 72 hours of overtime in a month are required under section 38 of the Employment Act, to apply for overtime exemption from the Ministry of Manpower. For work done on rest days or public holidays it is not included in the 72 hours’ limit for overtime. However, if an employee works beyond his normal daily working hours on his rest day or public holiday, the extra hours of work done would be included in the 72 hours’ limit for overtime work. The rate of payment for an employee who works overtime on his rest day and public holiday should be paid at not less than one and a half times his hourly basic rate of pay for the overtime work (as in the case of overtime work on any other day), in addition to his rest day or public holiday pay. J. Rest days An employee covered by Part IV of the Employment Act is entitled to a rest day comprising one whole day (midnight to midnight) every week. The rest day can be on a Sunday or any other day. The employer should determine the rest day and inform the employee before the beginning of each month. It is not a paid day. Employer cannot compel employees to work on rest day unless under very exceptional circumstances. The longest allowable interval between two rest days is 12 days. This can occur where in one week, the rest day is given on Monday, which is at the beginning of the working week. In the following week, the rest day is on Sunday, which is at the end of next working week. This will enable an employee to take two rest days at a stretch and allow an employer greater flexibility in the rostering of rest days. For a shift worker, the rest day can be a continuous period of 30 hours. A 30-hour rest period that commences before 6pm on a Sunday will be considered as one rest day within the week, even though the 30-hour period will extend into the next week, i.e. on Monday. K. Payment for work done on a rest day Payment for work done on a rest day should be calculated as such: a. Work done at employer’s request: * One day’s salary when the employee works up to half the normal daily working hours; or * Two days’ salary when the employee works more than half the normal daily working hours. a. Work done at employee’s request: * Half day’s salary when the employee works up to half the normal daily working hours; or * One day’s salary when the employee works more than half the normal daily working hours. If an employee works beyond the normal daily working hours on a rest day, he/she should be paid at least 1.5 times the hourly basic rate of pay. L. Benefits Other benefits outlined in the Singapore Employment Act include the following: a. sick leave, b. annual leave, c. maternity leave and holidays. Many companies actually offer better benefits than what is required by the Employment Act, though employers are not required to offer employees private health insurance. All Singaporean citizens pay into a government health plan through their employer. II. Fair Employment Singapore is a meritocratic society and implementing fair and merit-based employment practices is the right thing to do. Singapore also has a diverse workforce in terms of its ethnic, religious, age and gender makeup. It will be increasingly so in terms of age and gender, as our population ages and as we encourage more women to enter the workforce. Implementing fair and merit-based employment practices widens the pool of candidates that employers can recruit from, increasing their chances of finding the best person for the job. Treating employees fairly and with respect also helps employers to retain valued employees to sustain and grow their businesses. Employees will also be more motivated to put in their best for the organisation. The Tripartite Alliance for Fair Employment Practices (TAFEP) works with employer organisations, unions and the Government to create awareness and facilitate the adoption of fair employment practices. TAFEP was formed in pursuant to the recommendation of the Tripartite Committee on Employability of Older Workers to promote employment practices that are fair and equitable to all workers. The Alliance is co-chaired by Mr Heng Chee How, Deputy Secretary-General, National Trades Union Congress (NTUC) and Mr Bob Tan, Vice President, Singapore National Employers Federation (SNEF). The Alliance also includes members representing the employers, workers/unions, and the Government. III. Singapore Labour Laws for foreign workers In Singapore, minimum monthly salary of employment pass (EP) holders is S$2,500 (P77, 500). The â€Å"S† pass took effect July 1, 2004, catering to skilled workers at middle level with minimum salary of S$1,800 (P55, 800). â€Å"S† pass holders who earn basic monthly salary of at least S$2,500 (P77, 500) can take their spouse and children to Singapore. Professional licenses issued in the Philippines are not recognized. Filipino engineers and architects cannot sign on their project documents. WP (work permit) category includes domestic helper, nursing aide, healthcare assistant, technician and other positions that do not require special skills and college degree. Salaries for work permits are below S$1,800 (P55, 800) monthly. Work permits are valid for two years and maybe renewed with the Ministry of Manpower. Conditions of work permit holders as follows: a. Must possess high school diploma for continued employment in the City State; b. Can only work for employer/company and in occupation stated in his/her work permit card; c. Shall not get involved in any illegal, immoral or undesirable activities in Singapore –e.g. drugs, crime, prostitution, breaking up families; d. Shall not cohabit or have any children with a Singapore Citizen or Permanent President; e. Shall abide by conditions relating to marriage to a Singapore Citizen or Permanent Resident, as stated in conditions of work permit; f. Shall present self for medical examination by a registered Singapore doctor when requested by Controller of WP; g. WP card must be surrendered to the Work Permit Department upon completion, resignation or termination of employment; and h. Shall carry his/her work permit card at all times. IV. Restrictions Singapore’s Employment Act does not cover domestic helpers. Hence, most problematic of OFWs there are the DHs. Common problems DHs encounter are: being made to work in more than one household, exorbitant placement fees, non-payment of salaries, lack of valid employment contract as basis for settlement of claims/complaints, rare or even no days off, being made to do dangerous work (e.g. window cleaning in high-rise residence), and refusal of employer to attend to medical needs of sick domestic helpers. Singapore observes â€Å"open market† policy for domestic workers. Filipino women enter into contractual relationships without guidance from the Philippine government or its representative. They are subjected to excessive deductions from salaries by recruiters both in the Philippines and Singapore. In many cases, the terms and conditions of these employment contracts are below, or are non-compliant with the standards set by the POEA. Employers of DHs must inform the Ministry of Manpower (MOM) within 12 hours of their knowledge of death of their domestic workers. Employment agencies are prohibited from displaying foreign domestic workers. Any display of maids is considered a violation of Section 1, c of Employment Agency Act and could lead to withdrawal of agency’s license. Since May 3, 2004, work permits can be cancelled by simply sending a fax message to the MOM. Employers must submit to MOM the residential address of their foreign workers for easy monitoring in cases of emergency. Effective April 2004, first-time employers and domestic workers must attend seminars at MOM before issuance of work permit. SOURCES: http://statutes.agc.gov.sg/aol/search/display/view.w3p;page=0;query=DocId%3A%22571f13ea-3a91-47ef-a07b-f45d12fc2101%22%20Status%3Apublished%20Depth%3A0;rec=0 http://www.ehow.com/list_5989991_labor-laws-singapore.html http://www.gmanetwork.com/news/story/42715/pinoyabroad/singapore-labor-laws-for-foreign-workers http://www.guidemesingapore.com/incorporation/hr/singapore-employment-act-guide