Singapore’s employment laws are set to undergo watershed changes come April 2019. In summary, a greater number of employees – in particular, professionals, managers and executives (“PMEs”) – will soon be able to avail themselves of the statutory protections contained in Singapore’s Employment Act, the key employment legislation in Singapore.
The single most significant legislative change is the removal of the monthly salary cap of SGD 4,500 in respect of PMEs. Presently, only PMEs below this salary cap have the benefit of the provisions in the Employment Act relating to minimum periods of notice, paid public holiday and sick leave entitlements, as well as other protections such as timely payment of salary and protection against wrongful dismissal.
With these legislative changes, all PMEs regardless of their monthly salaries will fall within these provisions of the Employment Act.
At the recent second reading of the Employment (Amendment) Bill, the Minister for Manpower explained that the removal of the salary threshold was timely in light of the rising proportion of PMEs, which is expected to make up two-thirds of the Singapore workforce by 2030. The Ministry of Manpower estimates to an additional 430,000 PMEs are likely to benefit from this change.
Another legislative change to the Employment Act concerns the statutory protections found in Part IV of the Employment Act. These statutory protections – which relate to rest days, maximum hours of work, overtime payments – generally apply to vulnerable employees. Presently, these protections found in Part IV of the Employment Act cover workmen earning up to SGD 4,500 a month, and non-workmen earning up to SGD 2,500 a month. The Employment Act will be amended to increase the monthly salary threshold for non-workmen from SGD 2,500 to SGD 2,600, a move that is likely to expand these protections to half of Singapore’s total workforce.
As far as employers are concerned, some of the legislative amendments are aimed at giving businesses greater flexibility. For example, employers will now have an added option when it comes to certain employees (i.e. employees who are covered by the Employment Act but do not fall within Part IV) who are made to work on public holidays: these employees may now be given time off in-lieu instead of a full day off or an extra day’s pay.
The Ministry of Manpower also announced legislative changes to move the adjudication of wrongful dismissal claims from the Ministry of Manpower to the Employment Claims Tribunals (ECT). Presently, salary-related disputes are adjudicated by the ECT, while wrongful dismissal claims are adjudicated by the Ministry of Manpower. It has been observed that this distinction can be artificial as more often than not there are overlaps between both forms of disputes. These changes are therefore intended to provide both employees and employers with a more convenient “one-stop service” for the adjudication of employment disputes.
In addition to the above, there will be other legislative changes made to the Employment Act. For example, the requirement that employers can only recognise medical certificates which are either issued by government doctors or employer-approved doctors will be removed, and employers must now recognise all medical certificates issued by registered doctors (the rationale being that doctors in Singapore are today registered under the Medical Registration Act and are subject to the Singapore Medical Council Ethical Code and Ethical Guidelines).
Finally, it should be stated that notwithstanding these significant legislative changes, the Employment Act will continue to not cover public servants, domestic workers and seafarers, who are covered separately under other laws.
More information on these legislative changes may be found here.