Learn about employment law in Singapore thanks to Horizons’ up-to-date guide.
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The Employment Act 1968 (Employment Act) is the main piece of labor legislation in Singapore and provides the basic terms and working conditions for all types of employees, including part-time, contract and temporary employees, with some exceptions. The Employment Act applies to both Singaporeans and foreign nationals working in Singapore. The main regulator in Singapore is the Ministry of Manpower (MOM) which is responsible for enforcing the Employment Act.
In Singapore, the relationship between the employer and employee is largely governed by the contract of employment agreed between them. The contracting parties are generally free to contract as they choose, however, the terms of the employment contract must not be less favorable than what is prescribed in the Employment Act.
Other key pieces of legislation in Singapore that affect workplace relations include the Child Development Co-Savings Act 2001 (CDCA) which governs the maternity and paternity benefits employees in Singapore are entitled to, and the Central Provident Fund Act 1953 which mandates employer and employee contributions to the CPF.
An employee can terminate their employment at any time. The employment contract will usually specify the notice period required, which is typically one month. If no notice period is specified it will depend on the length of service.
Employers who terminate an employee’s employment contract must do so in accordance with the terms of their contract, providing valid grounds for dismissal.
Employees who have worked for an employer for at least 2 years are eligible for retrenchment benefits for their loss of employment. Those who have less than 2 years’ service may be granted an ex-gratia payment out of goodwill. According to the Ministry of Manpower (MOM) the prevailing norm is to pay employees a retrenchment benefit of 2 weeks’ to 1 month’s salary per year of service, depending on the industry and financial position of the company.
The employment contract is the most relevant legal document related to employment law in Singapore.
An employer is entitled to terminate an employee’s employment before the end of their probationary period by giving them the required notice according to their employment contract or by paying them a salary in lieu of their notice period.
An employee can also terminate their employment during their probationary period by serving notice or paying salary in lieu of notice. Unless their employment contract states otherwise, the notice period will likely be the same as if they were a permanent employee.
At the end of the probation period either party may terminate employment by adhering to the notice period stated in the employment contract. Alternatively, they may compensate the other party with salary in lieu of notice, or mutually agree to waive the notice period.
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