Hiring in Singapore gives you access to a skilled, educated workforce in a business-friendly environment. However, to remain compliant and avoid legal issues, it’s essential to understand the Employment Act Singapore and related labour laws. This article explains key employment regulations, statutory entitlements, and how to simplify compliance using FastLaneRecruit’s Employer of Record (EOR) services.
Outline
Key Summary
Understanding Employment Laws
Singapore’s Employment Act serves as the primary legislation governing employment terms, ensuring fair treatment and outlining employer obligations. Familiarity with this Act is essential for compliance.
Statutory Entitlements
Employees are entitled to specific benefits, including regulated working hours, overtime pay, annual leave, sick leave, and maternity/paternity leave. Ensuring these entitlements are met is crucial for employers.
Hiring Considerations
Singapore’s multilingual workforce offers advantages for businesses. However, employers should be mindful of cultural nuances, health benefit expectations, and the overall employment cost structure.
Compliance Strategies
Given the complexities of Singapore’s labour laws, partnering with an Employer of Record (EOR) like FastLaneRecruit can be advantageous. An EOR manages employment responsibilities, ensuring adherence to local regulations and simplifying the hiring process.
Overview of Labour Laws and Employment Act in Singapore
What is the Singapore Employment Act and Who Does it Cover?
The Employment Act Singapore is the main employment legislation that governs the relationship between employers and employees. It applies to both local and foreign employees who are under a contract of service, regardless of whether they are full-time, part-time, temporary, or contract workers. However, it excludes specific groups such as domestic workers, seafarers, and public servants, who are covered under separate regulations. Understanding who is covered under the Act is crucial for businesses to avoid misclassification and ensure legal compliance in employment practices in Singapore.
Why Compliance with the Employment Act is Crucial for Employers
Hiring in Singapore comes with various legal responsibilities. Non-compliance with the Singapore Employment Act can lead to penalties, lawsuits, and reputational damage. Employers must ensure that employment contracts reflect the minimum statutory terms such as working hours, rest days, overtime pay, and statutory leave. By aligning your hiring practices with the labour laws in Singapore, you protect your business and build a strong employer brand.
Singapore’s employment is governed by several key laws that cover employee rights and employer obligations. The main piece of legislation is the Singapore Employment Act which sets out the basic employment terms for all employees. It applies to all employees under a contract of service except for seafarers, domestic workers and public servants.
Other laws include:
- Common Law: Employment contracts and workplace disputes.
- Child Development Co-Savings Act: Parental leave.
- Employment of Foreign Manpower Act: Foreign worker employment.
- Work Injury Compensation Act (WICA): Workplace injuries and compensation.
- Workplace Safety and Health Act (WSHA): Safe working conditions.
EOR Services in Singapore for Hassle-Free Compliance
Setting up a company in Singapore to hire employees isn’t always necessary. With Employer of Record (EOR) services in Singapore, businesses can legally hire and manage local staff without a physical presence. A trusted EOR partner like FastLaneRecruit handles payroll, tax filings, statutory contributions like CPF, and ensures compliance with the Employment Act Singapore. This is an ideal solution for global companies looking to expand into Singapore quickly and cost-effectively.
Also Read: The Ultimate Playbook for Building and Integrating Offshore Teams
National Employment Law Framework in Singapore
Unlike many countries with state or regional employment laws, Singapore has a national-level employment law. This makes compliance simpler as businesses only need to follow one set of laws. The Singapore Employment Act is a one-stop shop, making it easier for foreign employers to be compliant with labour laws across the whole country.
Employers must comply with key areas such as working hours, leave entitlements and employee benefits. For example, the Employment Act regulates overtime pay, working hours and rest days which must be included in employment contracts.
Also Read: How FastLaneRecruit Helps Singapore Businesses Hire Top Talent
Key Considerations When Hiring Employees in Singapore
When hiring in Singapore, businesses must consider several key points. Singapore’s workforce is multilingual, with English, Mandarin, Malay and Tamil being the most spoken languages. This cultural and language diversity can be an advantage for businesses looking to expand into Asia.
Health benefits are another important aspect as 90% of Singaporean employers offer supplementary health insurance. Understanding Singapore’s tax and employment cost structure is crucial for budgeting purposes. For example, use a PEO/EOR Cost Calculator to estimate total employment costs.
If you don’t have a legal entity in Singapore, working with an Employer of Record (EOR) with us is a solution. An EOR manages employment responsibilities on your behalf including payroll, taxes and compliance so you meet all legal requirements without setting up a local entity.
Also Read: Singapore Job Market: Hiring Trends In 2025
Statutory Employment Entitlements under the Employment Act
Employees in Singapore have statutory entitlements that employers must comply with. Singapore does not have a minimum wage but has the Progressive Wage Model for certain sectors like cleaning and security to ensure minimum pay for those industries.
Other key entitlements include:
- Working hours: Employees cannot work more than 12 hours a day and overtime pay is at 1.5 times the basic hourly rate.
- Leave entitlements: Employees are entitled to annual leave, sick leave and maternity or paternity leave under the Child Development Co-Savings Act.
- Discrimination and probation periods: Although there is no anti-discrimination law yet, employers are encouraged to follow Tripartite Guidelines for fair employment practices. Probation periods are not mandatory but typically range from 3 to 6 months.
Employers should also be aware of Singapore’s Work Injury Compensation Act (WICA) which covers workers’ claims for work-related injuries. For local and foreign workers performing manual or non-manual work below a certain salary, employers are required to provide mandatory insurance.
How FastLaneRecruit’s EOR Services Ensure Employment Compliance
Singapore’s labour laws can be complicated especially for foreign employers who are not familiar with the local regulations. FastLaneRecruit offers full Employer of Record (EOR) services to simplify the hiring process and be compliant with Singapore employment laws.
Let FastLaneRecruit handle all your HR responsibilities from payroll management and tax filing to employee benefits and offboarding. Whether you are hiring local talent or expanding your global workforce, our customised solutions will get you hired smoothly and compliant with the Employment Act Singapore. Ready to hire in Singapore without worrying about compliance? Let FastLaneRecruit manage everything, from onboarding to payroll, while you focus on growth. Contact us today to simplify your hiring with our EOR solutions.
FAQs
What is the Employment Act in Singapore?
The Employment Act is Singapore’s main labour law that outlines minimum employment terms and conditions such as working hours, rest days, and leave entitlements. It covers most employees under a contract of service, excluding seafarers, domestic workers, and public servants.
Who is exempted from the Employment Act in Singapore?
Domestic workers, public servants, and seafarers are exempted from the Employment Act. These employees are governed by different legal frameworks and employment guidelines specific to their job sectors.
Do I need a Singapore company to hire employees locally?
No, you can hire employees in Singapore without setting up a legal entity by partnering with an Employer of Record (EOR). FastLaneRecruit offers compliant EOR solutions that handle HR, payroll, tax, and employment contracts for you.
What are the key statutory entitlements under Singapore’s labour laws?
Key entitlements under the Singapore Employment Act include regulated working hours (up to 44 hours per week), overtime pay, paid annual leave, sick leave, maternity/paternity leave, and protection under workplace safety laws.
What happens if I don’t comply with the Employment Act Singapore?
Non-compliance with Singapore’s Employment Act can result in financial penalties, disputes with employees, and even prosecution by the Ministry of Manpower (MOM). It’s essential to ensure employment contracts and HR practices meet legal requirements.
How can FastLaneRecruit help with employment compliance in Singapore?
FastLaneRecruit acts as your Employer of Record (EOR) in Singapore, taking care of legal hiring, payroll, taxes, and employee benefits. This helps your business stay compliant with Singapore’s Employment Act while expanding seamlessly into the local market.
