Hire in Singapore
Here’s where you get started with human resources best practices and hiring in Singapore.
Singapore Dollar (SGD)
Key Country Facts
Singapore was once a British colony. Its laws and customs are rooted in the British system and have been combined with the cultures, customs and practices of China, Malaysia and India. The city-state became independent in 1965 and is a parliamentary republic based on the Westminster system.
Singapore’s land area is about 710 square kilometers, an increase from 580 square kilometers since land reclamation projects started in the 1960s.
Singapore has a tropical rainforest climate with no distinct seasons. There is almost no variation in temperature throughout the year.
A blend of three races (Chinese, Malay and Indian) live and work in harmony. Singapore is a high-tech, wealthy city-state in Southeast Asia, also known for the conservatism of its leaders and its strict social controls. The country comprises the main island and approximately 50 smaller islands. The main island is connected to the southern tip of Malaysia by a causeway and bridge.
Singapore is a multiethnic nation with no religion claiming an absolute majority. Buddhism is the largest religion in the country, observed by 33% of the population. Approximately 19% identify as Christians, 14% as Muslims and 5% as Hindus. Roughly 20% are not affiliated with any religion. The remaining 9% is made up by other religions, including Taoism and folk religions.
Being a country that consists of multicultural communities, a diversity of languages are spoken. English is the official language for business and education.
Singapore HR at a Glance
The Employment Act is Singapore’s main labor law. It outlines the basic terms and working conditions for all types of employees, with some exceptions.
- The Employment Act covers local and foreign employees working under a contract with an employer.
- An employee can be employed in the term of full-time, part-time (less than 35 hours per week), temporary or contract.
- An employee can be paid based on hourly, daily, monthly or piece-rated.
Part IV of the Employment Act – which details rest days, hours of work and other conditions of service – only applies to one of the following:
- A worker performing manual labor (workman) and earning a basic monthly salary of not more than S$4,500.
- An employee who is not performing manual labor but is covered by the Employment Act and earns a monthly basic salary of not more than S$2,600.
Managers and executives are not covered in certain terms, such as overtime. In general, managers and executives are employees with supervisory and executive functions, respectively. Their responsibilities and authority may include one or all of the following:
- Making decisions in key operational areas such such as recruitment, discipline, termination of employment, performance assessment and reward.
- Formulating strategies and policies of the enterprise.
- Managing and running the business.
A contract of service defines the employer-employee relationship, outlining the terms and conditions of the employment. The contract must include certain terms and essential clauses, such as hours of work and job scope.
The contract of service details the mutually agreed upon terms and conditions of employment between the employer and employee. The contract includes both explicit and implied terms. Please note that if an employee is covered under the Act, the contract terms should abide by the minimum requirements under the Employment Act.
Employment contracts can be oral or written. If contracts are in the written form, it is mandatory for all employers to provide employees with a copy of the written employment contract. In addition, employers are required to obtain their employee’s consent prior to making any subsequent changes to the terms of the employment contract. It is not compulsory to conclude a written contract. Verbal contracts still refer to the Act. Hence, workers are protected.
Employment contract contains the Key Employment Terms, such as:
1) full name of employer
2) full name of employee
3) job title, main duties and responsibilities
4) start date of employment
5) duration of the employment (if the employee is engaged on a fixed-term contract)
6) working arrangements (daily working hours, number of working days/week, rest day)
7) salary period
8) basic salary
9) fixed allowances
10) fixed deduction
11) overtime payment period
12) overtime rate of pay
13) other salary-related components, such as bonus or incentives
14) type of leaves
15) other medical benefits
16) probation period
17) notice period
18) place of work
Employers usually have basic terms and conditions in the contracts. Any changes to the contract terms required the employee’s consent.
Probation Period / Trial Period
The Employment Act does not have any clauses on probation periods for employees. The common practice is three to six months.
During a probation period, a shorter termination notice period is usually applied.
The common practice for working hours is 40 to 44 hours per week, usually performed over five days per week. Before the contract begins, employers and employees agree on the working hours. The working schedule is one of the key employment terms.
The guidelines are as follows:
- If an employee works for five days or less per week, contractual work hours are up to nine hours per day or 44 hours per week.
- If an employee works for more than five days a week, contractual work hours are up to eight hours per day or 44 hours per week.
Overtime work is considered all work performed in excess of the normal hours of work, excluding breaks. An employee is eligible for overtime payment if he or she is:
- A non-workman earning up to S$2,600
- A workman earning up to S$4,500
The overtime rate payable for non-workmen is capped at a maximum salary level of S$2,600 or a maximum hourly rate of S$13.60.
For overtime work, employers must pay employee at least 1.5 times the hourly basic rate of pay. Payment must be disbursed within 14 days following the last day of the salary period.
Overtime hours cannot exceed 72 hours per month. If employers require employees to work more than 12 hours per day or 72 overtime hours per month, they must apply for an overtime exemption.
- Annual Wage Supplement (AWS) is also referred to as the 13th month payment. It is a single annual payment on top of an employee’s total annual wage. AWS cannot exceed one month’s salary
- AWS is not compulsory but common in practice. It is usually paid in December.
- Annual bonus is usually paid after the company’s financial year closing, when the performance of the company can be qualified.
- If one party wants to terminate the employment contract, they must provide notice of the termination to the other party in a written form or resignation letter.
- A termination letter is mandatory. Any notice of termination, either by an employer or an employee, must be in writing.
- If a termination letter is provided, the employee is still considered as an employee of the company.
- An employee either encashes or clears the annual leave if his or her employment is terminated.
- If the unused leave is encashed, it should be calculated at the gross rate of pay based on the employee’s last drawn salary.
- However, if an employee is terminated for misconduct, any unused leave will be forfeited.
- Employers with at least 10 employees are required to notify the Ministry of Manpower on retrenchments, regardless of the number of employees affected. The notification must be made within five working days after the affected employee has been notified of the retrenchment.
- The notice period outlined in a contract must be the same for both the employer and employee. The length of the notice period should correspond to the terms in the written contract (or verbal agreement if there is no written contract).
- Common practice is a one-month notice although this is often longer for higher level positions.
- Both parties may also agree to waive the notice period by mutual consent. Such a waiver should be concluded in writing.
Redundancy / Severance Pay
Employees who have served the company for at least two years are eligible for severance payment (retrenchment benefits). Those with less than two years’ service can be granted an ex-gratia payment out of goodwill.
The amount of severance payment depends on what is provided for in the employment contract or collective bargaining agreement (CBA) for unionized companies. If there is no provision, the amount will have to be negotiated between the employees (or their union) and the employer. The prevailing norm is to pay a retrenchment benefit of between two weeks to one month’s salary per year of service. This can also depend on the company’s financial position and the industry.
In unionized companies where the amount of retrenchment benefit is stated in the CBA, the norm is one month’s salary for each year of service.
Tax and Social Security
Personal Income Tax
Singapore income tax is a progressive tax rate system. The tax rates range from 0-22%. Income tax filing is simple, automated and web-based. Income tax is not deducted from an employee’s monthly salary payments, as employees pay their own income taxes.
Employers must prepare an annual wage report Form IR8A and Appendix 8A, Appendix 8B or Form IR8S (where applicable) for their employees. The documents must be passed to the employees by March 1 in the year following the employment year (January 1 – December 31). Employees refer to these reports to file their income tax returns.
|Income Above (Column A)||Income Not Above||Tax on (A) in SGD||Tax on Excess (%)|
The Central Provident Fund (CPF) is a comprehensive social security savings plan that provides working Singaporeans with a sense of security and confidence in their older age. The scope and benefits of CPF covers:
- Home ownership
- Family protection
- Asset enhancement
Singaporean and permanent residents (SPR) are eligible to participate in CPF. Foreigners are not eligible. Permanent residents and their employers will make contributions to CPF on a monthly basis. The deposits go into three accounts:
- Ordinary Account: funds to buy home, CPF insurance and investment
- Special Account: for retirement and older age investment
- Medisave Account: hospitalization and approved medical insurance
The contributions payable are based on the employee’s actual wages earned for the month. The employee’s share will be deducted from the employee’s salary. The rates for the CPF fall into three categories:
- Full employer and employee contribution: Singapore citizens and permanent residents of more than three years
- Graduated employer and employee contribution: first and second-year permanent residents
- Full employer and graduated employee contribution: first and second- year permanent resident with MOM approval
CPF contributions are determined by several factors including age, residency status and type of earnings. The contribution rates are subject to change.
The below table represents contribution rates for employees earning more than SGD 750 per month and who are Singaporeans or Singapore Permanent Residents of three years or more.
|Employee’s Age||Employer Contribution (%)||Employee Contribution (%)||Total (% of Wages)|
|55 and below||17.0||20.0||37.0|
|55 – 60||14.0||14.0||28.0|
|60 – 65||10.0||8.5||18.5|
|65 – 70||8.0||6.0||14.0|
The maximum employer contribution per month on ordinary wage is capped at SGD 1,020.
The maximum employee contribution per month on ordinary wage is capped at SGD 1,200.
The above rates serve as a broad guideline. Actual rates charged by GoGlobal will differ.
Payment via bank transfer is the most common mode for salary payments and is the mandatory payment mode for foreign workers.
Payslip must be made available monthly on website, PDF or paper.
- Employees are entitled to paid annual leave if they work for more than three months.
- Minimum annual leave is seven days for the first year and an additional one day for each additional year of service. This is capped at 14 days.
The number of days of paid sick leave is dependent on the employee’s service period.
|No. of Months of Service||Paid Outpatient Leave (Days)||Paid Hospitalisation* Leave (Days)|
|6 months and thereafter||14||60|
* An employee is deemed to be hospitalized if he or she is certified by a doctor to need hospitalization. He or she does not necessarily have to be warded in a hospital.
Maternity & Parental Leave
Maternity Leave under Child Development Co-Savings Act will be entitled to 16 weeks of maternity leave if all of the following are fulfilled:
- The child is a Singapore citizen.
- The mother has served her employer for at least three months before the birth of the child.
- The mother has given her employer at least one week’s notice before going on maternity leave.
The mother will be paid by her employer for the first eight weeks of maternity leave. The last eight weeks of maternity leave will be paid by the government.
For a female employee who does not qualify for Child Development Co-Savings Act Scheme, she may be entitled to 12 weeks maternity leave if she fulfills necessary criteria. The employer is required to pay a monthly salary for the first eight weeks of maternity leave. Whether the employer is required to pay salary during the last four weeks of maternity leave depends ultimately on the terms of the employment contract between the employer and employee.
Upon mutual agreement with her employer, an employee can take the last eight weeks (ninth to 16th week) of maternity leave flexibly over a 12-month period following the child’s birth. The number of days that can be taken flexibly will be equal to eight weeks’ worth of working days. This goes up to a maximum of 48 days.
The employer will pay the usual monthly salary during the leave period. They can then claim reimbursement from the government in accordance with the Government-Paid Maternity Leave (GPML) scheme: 50% for the first two children and 100% thereafter.
From January 1, 2017, eligible working fathers, including those who are self-employed, are entitled to two weeks of paid paternity leave. This is funded by the Government and is subject to the agreement of the mother. The following criteria under CDCA must be met:
- The child is a Singapore citizen born on or after January 1, 2017.
- The father is or was lawfully married to the mother of the child between conception and birth.
- The father has served his employer for a continuous period of at least three months before the birth of the child.
Childcare and Extended Childcare Leave
Childcare leave is regulated by the Child Development Co-Savings Act. Eligible working parents of Singapore citizen children are entitled to six days of paid childcare leave per year and need to meet the following criteria to be eligible:
- The child is a Singapore citizen,
- The youngest child is below 7 years old.
- The parent has served the employer for at least three months continuously.
Parents of non-citizens can get two days of childcare leave a year, in accordance with the Employment Act.
Extended Childcare Leave
Extended Childcare Leave under Child Development Co-Savings Act, eligible working parents of Singapore citizen children are entitled to two days of paid extended childcare leave per year and need to meet the following criteria to be eligible:
The child is a Singapore citizen,
The youngest child is between the ages of 7 and 12 (inclusive).
The parent has served the employer for at least three months continuously.
For parents with children in both age groups (e.g. below 7 years as well as between 7 and 12 years), the total paid childcare leave for each parent is a maximum of six days per year.
There are eleven public holidays in Singapore. Each major local race and religion have two holidays each in addition to the secular holidays of New Year’s Day, Labor Day and National Day.
Benefits to the Employee in Singapore
|Monthly Total Wages (SGD)||Monthly Contribution (SGD)|
|Less than 1,001||3.00|
|1,001 – 2,000||4.50|
|2,001 – 3,000||6.50|
|3,001 – 4,000||15.00|
|4,001 – 6,000||19.50|
|6,001 – 8,000||22.00|
|More than 10,000||26.00|
Singapore Indian Development Association (SINDA)
|Monthly Total Wages (SGD)||Monthly Contribution (SGD)|
|Less than 1,001||1.00|
|1,001 – 1,500||3.00|
|1,501 – 2,500||5.00|
|2,501 – 4,500||7.00|
|4,501 – 7,500||9.00|
|7,501 – 10,000||12.00|
|10,000 – 15,000||18.00|
|More than 15,000||30.00|
Chinese Development Assistance (CDAC) Fund
|Monthly Total Wages (SGD)||Monthly Contribution (SGD)|
|Less than 2,001||0.50|
|2,001 – 3,500||1.00|
|3,501 – 5,000||1.50|
|5,001 – 7,500||2.00|
|More than 7,500||3.00|
Eurasian Community (ECF) Fund
|Monthly Total Wages (SGD)||Monthly Contribution (SGD)|
|Less than 1,001||2.00|
|1,001 – 1,500||4.00|
|1,501 – 2,500||6.00|
|2,501 – 4,000||9.00|
|4,001 – 7,000||12.00|
|7,001 – 10,000||16.00|
|More than 10,000||20.0|
Visas and Foreign Workers
Singaporean citizens and Singapore permanent resident card holders may work at will. Foreign workers and expatriates must possess valid visas, work passes and employment passes prior to commencing work.
Foreigners and expatriates who wish to work in Singapore are required to possess permitted passes from the Ministry of Manpower (MOM). The work permit passes are varied based on the worker’s situation. Standard passes include work permit, S Pass, Employment Pass and Personalized Employment Pass. The type of pass granted is based on the candidate’s salary range, their skills, academic and related work knowledge. Pass holders may apply for permanent resident status if they decide to make Singapore their permanent home.
Public Holidays in 2022
|1||New Year’s Day||January 1st|
|2||Lunar New Year||February 1st – 2nd|
|3||Good Friday||April 15th|
|4||Labour Day*||May 1st|
|5||Hari Raya Puasa||May 3rd|
|6||Vesak Day*||May 15th|
|7||Hari Raya Haji*||July 10th|
|8||National Day||August 9th|
|10||Christmas Day*||December 25th|
*If a public holiday falls on a rest day (typically Sunday) or another public holiday, the next working day will be a holiday in substitution.