Employment law in Singapore is vital for business success. In a fast-moving market, companies must innovate while ensuring compliance with complex regulations. However, with rapid technological advancements, evolving workforce expectations, and increasing global competition, navigating these challenges is no small feat.
Now, imagine a future where compliance is seamless; AI-driven HR systems that automate regulatory updates, smart contracts that streamline employment agreements, and digital platforms that track compliance in real time. What once seemed like a dream is now a reality with solutions like the HashMicro HRM software.
This HRM software simplifies payroll with automated tax calculations as well as ensuring accuracy and compliance with CPF contributions. Smart contracts make employment agreements effortless, keeping them aligned with the latest labor laws.
Dynamic scheduling tools optimize work hours and overtime, minimizing compliance risks. With technology enabling smarter workforce management, staying compliant in Singapore is now easier than ever. Read on to see how you can simplify employment law compliance for your business!
Table of Content:
Table of Content
Key Takeaways
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What is the Employment Law in Singapore?
Employment law is the set of rules that define the rights and duties of both employers and employees, ensuring fairness and clarity at work.
In Singapore, businesses must comply with a structured legal framework, including the Employment Act, CPF contributions, and workplace fairness guidelines. Staying compliant not only mitigates risks but also fosters a positive work environment, enhancing productivity and employee satisfaction.
With evolving workforce expectations and regulatory changes, businesses need to stay agile. Leveraging smart HR solutions can simplify compliance, making it easier to focus on growth while ensuring employees are treated fairly.
What are the Employment Laws Impacting HRM in Singapore?
Employment law in Singapore create a structured framework that shapes how businesses manage their workforce. For HR professionals, staying compliant isn’t just about following rules—it’s about building a fair, efficient, and productive workplace. Several key laws impact HR management, and understanding them is crucial for smooth business operations.
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The employment act
As Singapore’s primary labor law, the Employment Act covers essential employment terms such as salary payments, standard working hours, leave entitlements, and termination procedures.
It applies to most employees, except for managers, executives earning above a certain threshold, domestic workers, and seafarers. HR teams must ensure that employment contracts align with these legal requirements.
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Central provident fund (CPF) act
The CPF Act mandates employers to make contributions to employees’ CPF accounts, ensuring retirement savings, healthcare coverage, and housing security. Non-compliance can lead to significant penalties, making it essential for HR departments to automate payroll processes to prevent miscalculations or delays.
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Workplace safety and health act (WSHA)
A safe work environment isn’t just a legal requirement—it’s key to employee well-being and business sustainability. The WSHA places the responsibility on employers to identify workplace risks, implement preventive measures, and maintain a culture of safety. HR professionals must work closely with safety officers to enforce these standards and prevent workplace incidents.
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Fair consideration framework (FCF)
Singapore promotes fair hiring practices through the Fair Consideration Framework, which ensures that employers provide fair job opportunities to local talent before hiring foreign workers. Non-compliance can result in work pass restrictions, making it critical for HR teams to adopt fair hiring policies and document recruitment efforts properly.
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Employment of foreign manpower act (EFMA)
For businesses hiring foreign employees, the EFMA outlines regulations on work passes, employment terms, and employer responsibilities. HR teams must ensure proper documentation, salary payments, and adherence to work pass conditions to avoid legal complications.
With evolving workforce regulations, HR teams must stay updated to prevent legal risks and ensure smooth operations. Leveraging HR technology, such as AI-driven payroll systems and compliance tracking tools, can simplify adherence to employment laws while improving overall efficiency.
By understanding and implementing these regulations effectively, businesses in Singapore can foster a compliant, ethical, and high-performing workforce.
What are the Key Provisions of the Employment Act?
The Singapore Employment Act forms the backbone of fair and transparent workplace practices, setting clear law expectations for both employers and employees. It ensures that businesses operate within a structured legal framework while safeguarding employee rights.
Understanding its key regulations is essential for compliance and fostering a productive work environment.
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Working hours and overtime pay
Work-life balance is a priority, and the Employment Act provides clear guidelines on standard working hours and overtime. Employees earning S$2,600 or less per month are covered under these provisions, with a standard workweek of 44 hours and a daily cap of 8 or 9 hours, depending on the work schedule.
For overtime, employees are entitled to 1.5 times their basic hourly rate for any extra hours worked, with a monthly overtime limit of 72 hours. Additionally, after six consecutive hours of work, employees must be given sufficient breaks to rest and recharge.
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Salary and minimum wage
Unlike many countries, Singapore does not enforce a minimum wage, except in specific sectors under the Progressive Wage Model (PWM). Instead, salaries are determined through employer-employee negotiations.
However, the law mandates that wages must be paid at least once a month and within seven days after the end of the salary period to ensure timely compensation.
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Public holidays and leave entitlements
Singapore recognizes 11 paid public holidays each year. If a holiday falls on a rest day, the next working day is a paid holiday. Employees required to work on public holidays must receive an extra day’s salary or a compensatory day off.
Annual leave entitlements are based on length of service, starting at seven days after the first year and increasing by one day per year, up to a maximum of 14 days. To promote work-life balance, many businesses also offer flexible work arrangements beyond the statutory requirements.
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Sick leave and medical benefits
Employee well-being is a key focus of the Act. Employees who have worked for at least three months are entitled to 14 days of paid outpatient sick leave and 60 days of paid hospitalization leave, which includes the outpatient allowance. Employees must provide medical certification and notify their employer in a timely manner.
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Employment contracts and termination rules
To promote clarity and prevent disputes, employers must provide written employment contracts within two months of an employee’s start date. These contracts should outline key terms, including job scope, salary, working hours, and termination conditions.
When it comes to termination, both employers and employees must adhere to notice periods as stipulated in the contract. In cases of immediate termination, either party must compensate with salary in lieu of notice unless there is cause for dismissal without notice.
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Additional protections under part IV of the act
Part IV of the Employment Act provides additional safeguards for manual workers and non-executive employees earning S$2,600 or less per month. These protections include regulated standard working hours, overtime pay, and mandatory rest intervals, ensuring fair treatment for employees in Singapore’s labor-intensive roles.
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Ensuring compliance and best practices
Employment laws in Singapore are constantly evolving to meet the needs of businesses and employees. To stay ahead, companies should regularly review HR policies, automate compliance tracking, and invest in HR technology to manage payroll, contracts, and leave entitlements efficiently.
By understanding and implementing these key regulations, businesses in Singapore can maintain a legally compliant and employee-friendly workplace; one that supports productivity, fairness, and long-term growth.
What are the Statutory Requirements of the Employment Act?
Understanding the Employment Act is crucial for businesses to ensure fair and lawful employment practices. This legislation sets out key obligations for employers, covering contracts, salary payments, working hours, leave entitlements, and employee protection.
By complying with these rules, businesses not only avoid penalties but also build a trustworthy and productive work environment. More importantly, when employees feel secure in their rights, they perform better; driving long-term business success. Let’s dive into the essential rules and statutory requirements every employer should know.
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Contracts of service
Employers must ensure that every employment contract meets at least the minimum standards set by the Employment Act. It’s important that employers don’t include terms that are less favorable than what the law stipulates. This guarantees that employees receive the basic protections they deserve.
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Salary payment and deductions
Employers must establish a fixed salary period, which should not exceed one month, ensuring timely payments. Salaries need to be paid within seven days after the salary period ends.
Deductions can only be made if explicitly authorized by the Act. Unauthorized deductions are prohibited, protecting employees from unfair reductions in their wages.
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Working hours and rest days
Employees should not work more than eight hours per day or 44 hours per week to maintain a healthy work-life balance.
Every employee is entitled to at least one rest day per week, which is typically Sunday, though employers can assign another day if needed.
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Leave entitlements
Employees are entitled to various types of leave depending on their employment duration and personal circumstances. These entitlements include annual leave, sick leave, maternity leave, and childcare leave, all of which are designed to support employees’ well-being while ensuring compliance with the Act.
For detailed information on leave specifics, businesses should refer to the Act or consult with legal experts.
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Termination of employment
Either the employer or employee can terminate the contract by providing notice. The notice period is based on the length of employment. For instance, employees with less than 26 weeks of service need to provide one day’s notice, while those with more than five years of service must provide at least four weeks’ notice.
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Employee protection and retrenchment
Employees cannot be dismissed without just cause. If an employee believes they have been unfairly dismissed, they have the right to file a claim for reinstatement or compensation. In the case of retrenchment or layoffs, employers must adhere to statutory notice periods and severance pay requirements.
While not a legal requirement, offering two weeks to one month of salary per year of service as severance is considered a best practice.
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Employment records
Employers in Singapore must maintain accurate records of employee details such as salary, working hours, and leave entitlements. These records must be kept for a prescribed period and must be readily accessible when needed.
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CPF contributions
The Central Provident Fund (CPF) is a mandatory savings scheme for Singaporean employees. Employers are required to contribute a percentage of employees’ salaries to CPF, with the contribution rates determined by the government based on the employee’s age.
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Compliance and penalties
Failure to comply with the Employment Act can result in fines, penalties, or even imprisonment. Ensuring adherence to statutory requirements not only helps businesses avoid legal risks but also fosters a fair, transparent, and compliant work environment.
How Can Businesses Enhance Employee Satisfaction through Non-Statutory Benefits According to the Employment Act?
While the Employment Act sets the foundation for statutory requirements, businesses in Singapore can greatly enhance employee satisfaction by offering non-statutory benefits and perks that go above and beyond legal obligations.
These benefits, though not mandated by law, play a significant role in improving employee morale, engagement, and retention. By offering these perks, companies can create a more attractive work environment and position themselves as employers of choice in Singapore’s competitive job market.
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Health and wellness initiatives
Employers who invest in their employees’ well-being often see a direct link between healthy, happy employees and increased productivity. In addition to mandatory healthcare contributions, many companies offer comprehensive health insurance, gym memberships, or mental wellness programs.
These employment law initiatives support both physical and mental health, reducing stress and burnout while helping employees stay energized and focused on their work in Singapore. Prioritizing wellness not only fosters loyalty but also demonstrates a commitment to the long-term well-being of employees.
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Learning and career development
As the tech sector changes rapidly, continuous learning is essential. Many companies in Singapore offer sponsored courses, workshops, and in-house training to ensure that employees remain on the cutting edge of their field.
By supporting professional growth, businesses not only equip their teams with valuable skills but also cultivate a culture of innovation and adaptability. When employees feel that their career development is a priority, it strengthens their engagement and satisfaction, contributing to lower turnover and higher retention rates.
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Additional leave benefits
Beyond the statutory leave entitlements, many employers offer additional leave options, such as extra annual leave, sabbaticals, or even birthday leave. Such benefits can go a long way in boosting employee satisfaction, offering workers the opportunity to recharge and spend quality time with family or pursue personal interests.
By demonstrating flexibility in leave policies, companies show that they understand the importance of work-life balance and care for their employees’ overall happiness.
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Wellness programs and employee assistance
To further support employees’ personal well-being, many employers provide wellness programs or employee assistance programs (EAPs). These initiatives can include counseling services, stress management workshops, or mental health days.
By addressing both the physical and emotional needs of their teams, businesses not only improve employee morale but also create a more supportive and empathetic workplace environment.
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Travel allowances and relocation packages
For companies that require frequent business travel or employee relocation, offering travel allowances and relocation packages can significantly ease the burden on employees. These perks, which may cover transportation, meals, or housing costs, help reduce the financial strain on employees and allow them to focus on their work.
Such benefits make it easier for businesses to retain top talent, especially in roles that require regular travel or relocation.
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Employee stock purchase plans (ESPP)
Many companies offer Employee Stock Purchase Plans (ESPPs), allowing employees to purchase company shares at a discounted rate. This not only helps employees feel more invested in the company’s success but also strengthens their commitment and engagement.
Sharing in the company’s financial success creates a sense of ownership and motivates employees to contribute to the organization’s growth, which can ultimately drive innovation and productivity while complies with the employment law in Singapore.
What Types of Leave are Employees Entitled to Under Employment Law in Singapore?
Singapore’s Employment Act provides a well-structured framework to ensure employees enjoy a balanced work-life environment. For businesses, understanding and implementing these leave entitlements is key to fostering a supportive and productive workplace. Let’s take a closer look at the various types of leave available to employees in Singapore.
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Annual leave
Employees who have completed at least three months of service become eligible for paid annual leave, with entitlements increasing based on tenure. In the first year, employees receive seven days of paid leave, which increases by one additional day for each subsequent year of service.
The maximum entitlement is capped at 14 days of paid leave after eight years of service. Many companies offer additional leave beyond these statutory requirements to attract and retain top talent.
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Sick leave
To support employees’ health and well-being, employment law in Singapore grant paid sick leave to those who have worked for at least three months and have valid medical certification. Employees are entitled to up to 14 days of outpatient sick leave per year.
If hospitalization is required, they can receive up to 60 days of hospitalization leave, inclusive of the outpatient sick leave entitlement.
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Maternity leave
Working mothers are entitled to 16 weeks of maternity leave, provided they meet the eligibility criteria. The first eight weeks are paid by the employer, while the remaining eight weeks are funded by the government.
This provision helps mothers balance their professional and personal commitments effectively while ensuring they have sufficient time to recover and care for their newborns.
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Paternity leave
Fathers also benefit from Singapore’s family-friendly employment law and are entitled to two weeks of government-paid paternity leave. This allows them to support their partners during the early days of parenthood and bond with their newborns.
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Shared parental leave
To provide families with greater flexibility, fathers have the option to share up to four weeks of their spouse’s maternity leave. This arrangement enables parents to allocate leave according to their specific needs and caregiving responsibilities.
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Adoption leave
Adoptive mothers are entitled to 12 weeks of government-paid adoption leave if the adopted child is below 12 months old. This leave supports adoptive parents in transitioning into their new family roles and ensures they have sufficient time to bond with their child.
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Childcare leave
Employees with children under seven years of age are entitled to six days of paid childcare leave per year, provided they have worked for at least three months. This benefit allows parents to manage their caregiving responsibilities more effectively while maintaining their professional commitments.
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Unpaid infant care leave
For parents of Singapore citizen children under two years old, an additional six days of unpaid infant care leave per year is available. The Employment law provides extra flexibility for parents to attend to the needs of their young children in Singapore when necessary.
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Public holidays
Employees in Singapore enjoy 11 paid public holidays annually. If they are required to work on a public holiday, they must be compensated with an additional day’s salary or given a day off in lieu to ensure they are fairly compensated for their time.
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National service leave
Employees fulfilling their National Service (NS) obligations are entitled to leave for the duration of their service. This ensures they can meet their national duties without concerns about job security or financial loss.
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Other types of leave (company-dependent)
Beyond statutory leave, many companies offer additional leave benefits to enhance employee satisfaction and engagement. Then, marriage leave allows employees to take time off for their wedding celebrations. Furthermore compassionate leave provides employees with time off to attend to bereavement and family emergencies.
Finally, examination leave is granted to those pursuing further education, enabling them to prepare for and sit for their exams without work-related stress.
How Should Businesses Handle Employee Termination in Compliance with the Law?
Employee termination is a sensitive yet necessary process that must be handled with fairness, professionalism, and full compliance with the employment law in Singapore. Employers need to ensure that terminations are legally sound, transparent, and respectful, minimizing risks while maintaining workplace integrity.
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Termination with notice
Employers can terminate an employee by providing written notice, as outlined in the employment contract.
If no notice period is specified, the Employment Act applies, ranging from one day for less than 26 weeks of service to four weeks for more than five years. During this period, employees must continue receiving their salary and benefits.
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Immediate termination (payment in lieu of notice)
Employers may opt for immediate termination by compensating the employee for the notice period. This approach ensures a swift transition while maintaining fairness.
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Termination for misconduct
In cases of serious misconduct, such as fraud or negligence, termination without notice is allowed. However, employers must conduct a fair investigation and provide the employee an opportunity to respond to avoid wrongful dismissal claims.
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Retrenchment and redundancy
For retrenchment or business closure, employers must follow the Tripartite Guidelines, provide adequate notice or compensation, and notify the Ministry of Manpower (MOM) if retrenching five or more employees within six months. While not mandatory, offering two weeks to one month of salary per year of service is a recommended practice.
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Protection against wrongful dismissal
Employees cannot be dismissed unfairly for discriminatory reasons, retaliation, or exercising legal rights. Wrongfully dismissed employees may file claims with MOM or the Employment Claims Tribunal (ECT).
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Final payment and offboarding
Employers must settle final salary payments, including unused leave, on the last working day or within seven days. They should also recover company assets, revoke system access, and conduct an exit interview to ensure a smooth transition.
How Employment Law in Singapore Ensures Data Privacy and Confidentiality?
In Singapore, businesses must comply with the Personal Data Protection Act (PDPA), which requires obtaining employee consent before collecting data, ensuring its accuracy and security, and securely disposing of it when no longer needed.
Non-compliance can lead to significant penalties such as losing their reputation, facing financial fines, and potential legal actions from affected employees or regulatory bodies. Furthermore, businesses may face disruptions and lose trust from employees and clients, affecting long-term performance and morale.
Employees have the right to access, correct, and withdraw consent for their data, promoting trust and transparency. Employment contracts typically include confidentiality clauses to protect sensitive company information.
With remote work on the rise, businesses must adopt strong cybersecurity measures, including encrypted communication and multi-factor authentication, to safeguard data. Employers must also comply with PDPA guidelines when monitoring employee activities.
How HashMicro HRM Software Can Streamline Your Regulatory Issues?
Navigating the complexities of Singapore’s business environment can be overwhelming for businesses, especially with regulations that are constantly evolving. As a result, staying compliant while managing a dynamic workforce can feel like a daunting task.
However, HashMicro HRM Software offers a seamless solution to streamline your HR processes, ensuring full compliance with local laws. By automating key HR functions, HashMicro helps businesses save time, reduce risks, and enhance operational efficiency. Let’s take a look at what HashMicro has to offer for your business:
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Automated payroll and tax calculations
Ensuring compliance with payroll, tax, and CPF regulations is crucial, and HashMicro’s Fully Localized Payroll with Tax Calculation feature takes care of this with ease.
By automatically calculating employee salaries, taxes, and CPF contributions in line with the latest legal requirements, businesses can avoid costly errors and delays, all while ensuring accuracy and timely compliance.
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Efficient attendance and overtime management
Managing employee attendance and overtime can be challenging, but HashMicro’s Face Recognition and GPS Attendance feature simplifies the process.
This advanced technology ensures that only employees physically present can log their hours, enhancing security and preventing fraudulent attendance reporting—ultimately keeping your business compliant and efficient.
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Comprehensive leave management
Leave management is an essential aspect of compliance, and HashMicro’s In-Depth Leaves Management automates the entire process. This feature tracks leave balances, carryovers, and expiration dates, ensuring that all leave requests are handled promptly and in compliance with labor laws.
By reducing administrative workload, it also ensures transparency and fairness in managing employee leaves.
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Streamlined employee contracts and documentation
HashMicro’s Built-In Professional Templates for Contracts and Payslips simplify the creation of legally compliant employment contracts and payslips. The system generates professional, standardized documents in minutes, ensuring that contracts are in line with legal requirements and minimizing the time spent on administrative tasks.
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Mobile employee self-service
As remote and hybrid work environments become more prevalent, HashMicro’s Mobile Apps for Employee Self-Service offer employees the flexibility to access and manage their HR information, including attendance, leave, and personal data, directly from their mobile devices.
This self-service feature not only empowers employees but also reduces the administrative burden on your HR team. By implementing HashMicro HRM Software, businesses can easily navigate the complexities of employment law in Singapore.
With automated payroll processing, streamlined attendance tracking, efficient leave management, professional documentation templates, and employee self-service features, HashMicro ensures full regulatory compliance to employment in Singapore while saving businesses valuable time and resources.
Whether you’re looking to enhance operational efficiency or reduce the risk of non-compliance, HashMicro provides the tools you need to stay ahead of the curve. Embrace the future of HR management with HashMicro and focus on what truly matters: driving business growth and success.
Conclusion
Staying compliant with employment laws in Singapore is essential for fostering a productive and legally sound workplace. By understanding employee entitlements and maintaining transparent practices, businesses can avoid legal pitfalls and enhance employee satisfaction, leading to improved retention and performance.
As your business evolves, managing HR processes can become increasingly complex. However, with the right tools, you can simplify compliance, data management, and employee relations. Streamlining these tasks ensures your business operates efficiently while remaining compliant with the latest regulations.
This is where HashMicro HRM Software comes in. With its comprehensive, automated features, HashMicro simplifies the management of payroll, attendance, leave, and compliance in Singapore. Our software offers businesses the ability to stay ahead of changing regulations with ease.
To experience the benefits first-hand, we invite you to try our free demo and see how HashMicro can help streamline your HR processes, reduce risks, and elevate operational efficiency.
FAQ on the employment law in Singapore
Who is covered under Singapore’s Employment Act?
The Employment Act covers any person who has entered into a contract of service with an employer. This includes workmen engaged in manual labor and persons in managerial or executive positions (PMEs), regardless of their salary level.Who is not covered by the Employment Act Singapore?
The following groups are not covered by the Employment Act: – Seafarers: Employees working on ships are excluded due to their unique working conditions. – Domestic Workers: Individuals employed in households, such as maids or caregivers, are not covered. – Civil Servants and Statutory Board Employees: Employees of government agencies and statutory boards are also excluded.What are the primary laws for foreign workers in Singapore?
The main laws governing foreign workers include the Employment of Foreign Workers Act, the Employment Agencies Act, and specific regulations under the Work Permit framework. These laws regulate the entry, employment, and welfare of foreign workers in Singapore..What is the new employment law in Singapore?
Recently, there is the Workplace Fairness Bill, which was introduced in Parliament on November 12, 2024, and passed on January 8, 2025. This Bill aims to enhance protections against workplace discrimination and establish fair employment practices.
