Hire in Singapore — without an entity
Horizons offers global employment and payroll solutions for businesses recruiting and hiring in Singapore. Through our Singapore PEO solution, we take care of your company’s employee payroll in Singapore. In addition, as the Singapore Employer of Record, Horizons becomes responsible for all employment and tax compliance. This way, your business can enter the Singapore market faster, and potentially save tens of thousands in business expansion costs.
Our Singapore PEO simplifies your expansion
Horizons supports business expansion into Singapore – without setting up a legal subsidiary.
Horizons helps your business navigate Singapore’s labor laws and regulations. Horizons’ Singapore PEO solutions manage and process all employee payments and deductions, as well as absorbing all local employment liabilities. Partnering with our Singapore PEO & Employer of Record means a quick, cost-effective, and compliant way to enter the Singapore market.
Singapore employment and human resources
🇸🇬 Our regional presence
As Asia’s leading PEO, we maintain a strong local presence in this commercial hub of South-East Asia.
From our Singapore office, we can recruit and hire your Singapore workforce through our Singapore PEO. As a licensed employment agency within Singapore, we ensure employment and tax compliance on your behalf, and maintain relationships with Singapore government authorities.
261 Waterloo Street
Waterloo Center, 180261 – Singapore
+65 31388 931
📝 Singapore employment contract types
In Singapore, employers are advised to prepare a strong, written contract that clearly states relevant employment terms. This should include the job description, employee responsibilities, and the compensation and benefits attached to the role.
In relation to letters of offer and employment contracts, both types of document should always outline compensation amounts in Singapore dollars (SGD). Horizons can assist you to draft employment contracts, either through our Singapore Employer of Record & PEO or your own local entity.
⏰ Working hours in Singapore
Under Singapore law, working hours must not exceed 44 hours per week. For employees who work five or less days per week, daily hours should not exceed more than nine hours. For employees who work more than five days per week, daily hours should not exceed more than eight hours.
Employees in Singapore may be entitled to overtime at a rate that is 1.5 times their hourly wage. This will be dependent on whether the employee is classified as either a ‘workman’ or ‘non-workman’. Additionally, this will only apply if an employee’s salary is under an applicable cap.
📅 Singapore public holidays
New Year’s Day
Chinese New Year
Chinese New Year Holiday
Chinese New Year (in lieu)
Hari Raya Puasa
Hari Raya Puasa Holiday
Hari Raya Haji
In Singapore, the CPF (Central Provident Fund) is the predominant benefit or social security expense that is nationally-mandated. While this amount can vary, employers are advised to budget 17% of the employee’s salary – on top of the existing salary. This amount is the benefit cost that is contributed to the CPF by the employer.
There are no employee or employer tax contributions required on a monthly basis in Singapore. Individual tax must be submitted by March 30th each year and report the employee’s income from the previous calendar year.
Horizons will submit your employees’ individual income tax by March 30th of each year. In practice, the tax assessment from the IRAS (authority) would be finalized in approximately 1-2 months. After assessment has been completed, full settlement of the tax payable is required by the individual (in most cases no later than May). Consequently, there is no tax withholding or deduction on a monthly basis. It remains the responsibility of the employee to file employee tax.
🏥 Health insurance
In Singapore, standard insurance is provided through the national system (Medishield Life). Employers can elect to provide their employees with supplementary insurance. This would be classified as a supplementary benefit.
🏖 Vacation leave
There are generally 14 days annual vacation granted to employees in Singapore. For senior executives, this can rise to between three and four weeks. In Singapore, the statutory minimum is seven days, plus an additional day for each subsequent year of service – up until eight year’s service. After an employee has been with an organization for eight years, the legal minimum remains at 14 days vacation per year.
😷 Sick leave
In Singapore, employees are normally entitled to sick leave if they have worked for an organization for more than three months. Additionally, employees must inform their employer within 48 hours of their scheduled absence. All sick leave must be certified by either the organization’s doctor, an organization-approved doctor, or a government-doctor.
The amount of paid sick leave is dependent on how many years the employee has been with the employer.
Between 3 and 6 months the employee is entitled to pro-rated sick leave, from 5-11 outpatient sick leave days, to 15-45 hospitalization sick leave days.
For employees that have been employed more than six months, they are eligible for 14 days of outpatient, non-hospitalization leave. Additionally, these employees are entitled to 60 days of hospitalization leave, including 14 days outpatient leave.
👶 Maternity and paternity leave in Singapore
Female employees who are Singapore citizens and have been with their employer more than three months are generally entitled to 16 weeks paid maternity leave. To be eligible for maternity leave, the child must also be a Singapore citizen.
For a female employee’s first two pregnancies, employers must pay for the first eight weeks of maternity leave. The Singapore government will pay for the remaining eight weeks. In Singapore, the government pays all maternity leave for additional pregnancies.
Employees who are not Singapore citizens are normally entitled to 12 week’s paid maternity leave, unless their employment contract states otherwise. For employees that have been with an organization less than three months, they are not entitled to paid maternity leave.
Female employees may share up to four weeks of maternity leave with their husbands – provided they are legally married and the husband is the child’s father.
In Singapore, fathers are normally entitled to two week’s paid maternity leave that is funded by the government. To be eligible for paternity leave, fathers be currently or previously married to the child’s mother between the period of conception and birth. Fathers must also be Singapore citizens and have been employed for a continuous period of more than three months prior to the child’s birth. Paternity leave in Singapore is capped at a rate of SGD 2,500 per week.
💸 Singapore work bonuses
Similar to both China and Hong Kong, a 13th month bonus (or annual bonus) is frequently offered to employees in Singapore. For sales employees, commission payments may replace this form of bonus.
During times when the Singapore economy is strong, an annual bonus may be equal to between two and three month’s annual salary.
💰 Termination and severance
In Singapore, a probation period of between three and six months is often agreed upon in an employment contract. During this time, there is generally a shorter notice period, although this is not a statutory requirement.
One month’s termination notice – from both the employee and employer – is normally the agreed term. However, this is not a fixed rule across all work arrangements.
For circumstances where there is no notice period specified in the employment contract, there are standard notice periods that apply. For employees that have been employed less than 26 weeks, the notice period is one day. This increases to one week for employment between 26 weeks and two years; and two weeks for employment between two and five years. For employment periods of more than five years, four week’s notice is required from either party.
Navigating employee terminations and handling severance packages can be complicated for companies expanding overseas for the first time. Horizons’ Singapore PEO & Employer of Record can mitigate risk for foreign companies and provide guidance through this process.
🧾 Social charges
The Central Provident Fund (CPF) is perhaps the most important function of the country’s social security system. The CPF provides employees with a social security savings plan, as well as administering other types of benefit, such as healthcare and retirement.
Similar to retirement plans in the United States, there is both an employer and employee contribution to this social security fund. Contributions are distributed into one of the following three accounts:
- Ordinary Account
This account is available for home purchases, making investments, paying for education expenses, and covering CPF insurance.
- Special Account
The special account is aimed at employees nearing retirement. It covers products and services related to retirement.
- MediSave Account
This account can be applied to any approved medical expenses, including hospitalizations, doctor visits, and medical insurance.
The maximum CPF contribution rate is 17% for employers and 20% for employees, up to the age of 55. From 55 the required rate starts to decrease — from 65, employers pay 7.5% and employees 5%. Note, foreign employees who possess an employment pass or work permit in Singapore are not required to make CPF contributions.
📈 Immigration procedure for foreign workers
Foreign workers are required to have the necessary visas and work permits in Singapore, as stipulated by immigration laws. As part of our services, Horizons can sponsor your employees to obtain the required permits. The most common work permit is the Employment Pass, which is applicable for suitably qualified foreign workers earning at least SGD 3,300 per month.
Horizons’ appointed employment agent (EA) or local Singapore entity applies for the Employment Pass via EP Online. The approval process takes seven working days, after which the Singapore Ministry of Labour issues an In-Principle Approval (IPA). Horizons then provides the employee with their Employment Pass.
About the Employment Pass application with Horizons
Employment Pass applications are carefully assessed by the Ministry of Manpower (MOM) on a case by case basis. MOM takes into consideration a number of factors such as the applicant’s qualifications, work experience, job scope, economic contribution, and their ability to complement Singapore’s local workforce.
Requirements & Considerations
To be considered for an Employment Pass, Horizons must receive one or more of the following:
- A recognized Diploma/Degree qualification
- A list of other qualifications and certifications (professional or educational)
- A list of specialist skills
- Documentation that outlines relevant work experience
Procedure & Timeframe
Horizons will submit your employees’ Employment Pass applications to the Ministry of Manpower (MOM). This process generally takes between five and eight weeks, from application to collection of the pass.
Applications can be submitted either manually or online. Around 80% of our applications are conducted online and generally take at least three weeks to process. For online submissions, Horizons will confirm the details of the new hire and ensure that all required supporting documentation is lodged. Our legal department processes each case in 1-2 weeks.
Manual applications are preferred by applicants whose supporting documents (eg. testimonials from previous employers, writing samples, etc.) highlight other merits. Manual applications take at least five weeks, from the receipt date of the application.
Prior to validating any application for a foreign candidate, we suggest you provide us with copies of the employee’s CV and any education or professional certifications. We also need to know the employee’s proposed designation with your company.
Before any application can be finalized, we require the following:
- A copy of the employee’s passport with clear facial features. The validity of the passport should be at least six months.
- Degree or diploma certificates. For India qualifications, all mark sheets (transcripts) must be included. For China qualifications, we require a certificate of graduation.
- Copies of additional professional / trade/ specialist certificates.
- Detailed Curriculum Vitae (CV) and declaration forms.
- An employment contract with Horizons, approved by your company.
Any document not in English must be accompanied by its official English translation.
💳 Compensation & benefits
Singapore compensation laws
In Singapore, there is no universally set minimum wage. This means that employers can use their discretion when deciding on appropriate wages for their employees. There are two exceptions where a minimum wage applies to the industry: cleaners and security guards.
While there is no universal minimum wage, international businesses operating in Singapore need to be aware of the ‘Local Qualifying Salary’ or ‘LQS’. We explain below.
In Singapore, a company can only hire foreign workers where it also hires a certain number of local workers. The exact proportion of foreign to local workers depends on the industry. For example, in the construction industry, 87.5 per cent or workers can be foreign employees, meaning a company can hire seven permit holders for every local worker. To ensure that a business does not pay the local worker a token sum, from 1 September 2022, the company will need to pay those local workers a minimum of $1,400 per month. This amount is the Local Qualifying Salary.
In relation to employment contracts, best practice is that employers draft a clearly-worded written contract. All references to salary should be made in Singapore dollars (SGD).
While annual bonuses are not mandated in Singapore, many employees do receive some form of bonus. In fact, during times when the Singapore economy is strong, annual bonuses may be as much as three month’s salary.
Singapore’s Employment Act makes reference to the recommended compensation that employees be paid for overtime. For any workers earning more than 2,000 SGD per month — like many managers and senior executives — overtime compensation must be specified in employment contracts. For workers earning less than 2,000 SGD per month, overtime should be paid at a rate that is 1.5 their hourly rate.
Guaranteed benefits in Singapore
When it comes to Singapore benefit management, employers need to understand which benefits are mandatory under the law, and which are provided by employers as a supplement.
All employees in Singapore receive basic health insurance, via the national system. However, employers have the discretion to provide additional health benefits. In Singapore, it is common for employers to offer supplementary health and life insurance to employees. An alternative option taken by many employers, is to provide a small allowance that can be allocated towards supplemental insurance.
Any additional benefits such as additional sick, maternity or vacation leave, or a housing allowance, should be considered when drafting employee contracts.
Singapore benefit management
Employers have the option of managing their employees’ benefits themselves, or outsourcing their benefits administration to a Singapore PEO. Note, however:
- If choosing to manage benefits themselves, employers are required to find additional insurance options for that workforce. Additionally, they will need to maintain compliance with Singapore employment laws and regulations.
- Our Singapore PEO & Employer of Record can manage your payroll and benefits administration in Singapore. When you partner with Horizons, our in-country experts ensure full business complies with Singapore employment laws and regulations.
Legal framework for employee benefits in Singapore
In Singapore, employee remuneration laws require that employees are paid at least once a month, and within seven days of the end of the period. Where an employee works overtime, they must be paid within 14 days of the salary period.
The Singapore Employment Act covers all basic labor entitlements including maximum work and overtime hours, sick leave, annual vacation leave, paid public holidays, and paid maternity leave. Before hiring, it is essential that employers understand their obligations as specified in the Singapore Employment Act.
Often, international businesses benefit from having a local employment partner to ensure compliance with employment laws. Through a Horizons’ Singapore PEO solution, you can have confidence that all local employer obligations, including benefits and social contributions, are fully complied with.