Starting an Employment Agency in Singapore

An employment agency in Singapore is a company that helps other companies with their recruitment and staffing needs, normally acting as the middle party between employer and potential employee. An employment agency could be engaged in placement of local as well as foreign candidates starting from junior level positions to top-level executives. The term in Singapore even applies to companies that run online job portals. With Singapore encouraging foreigners from executive and middle-management levels to manual labourers to work in the country, there are numerous small and big placement agencies and head hunting firms to help Singapore companies meet their staffing needs.

All employment agencies in Singapore require an Employment Agency License. Before starting any business activity, an employment agency must obtain an Employment Agency License (EAL). This is the basic license required for all categories of recruitment agencies and  is governed by the Ministry of Manpower (MOM) of Singapore. Employment agency licence in other countries is often also referred to as:

• recruitment agency licence
• staffing agency licence
• placement agency licence
• manpower agency licence

The purpose of this guide is to provide information on how to start an employment agency and get the required license. Note that an employment agency licence is not required if you are hiring staff under your company's direct employment.

Employment Agency Setup - Key Requirements

The following key requirements apply for setting up an employment agency in Singapore:

• You must first incorporate a Singapore company under the business activities of 78115 (executive search) or 78114 (employment agency excluding maid agencies). For details on how to setup a Singapore company, refer to Singapore Company Registration guide.
• The company must establish an operating business office. If you plan to use a home office, you will need an approval from HDB or URA authorities depending on the type of house (public or private) you have.
• The company must obtain Employment Agency Licence issued by Singapore Ministry of Manpower. Although the employment agency licence is for a business, the licence application is filed under a natural person (usually the owner of the business) who must be a Singapore Citizen, Permanent Resident, or Employment Pass holder at the point of filing the application. If you are a foreign person who is setting up the recruitment agency in Singapore, you will need to obtain an Entrepreneur Pass or Employment Pass before you can apply for the license.
• The company must furnish a Security Deposit of $20,000 in the form of Banker's Guarantee once the employment agency license is approved-in-principle. 
• If your employment agency will be involved with placement of labour workers, you will need to attend a course and obtain a Certificate of Employment Agency. This is a MOM-accredited course conducted by the Singapore Polytechnic and comprises 54 hours of lectures, 12 hours of tutorials and two three-hour exams over a period of three months.  

Employment Agency Licence - Application Procedure

The employment agency licence application is filed online. No government fee is required at the time of filing the application. The application processing time for employment agency license application is approximately 1-2 weeks. You will be notified via email and if your application is approved, an in-principle-approval (IPA) letter will be attached.

After receiving the IPA letter, you will need to submit the following documents in order for the licence to be issued: 

• Obtain a $20,000 Security Bond in the form of Banker's Guarantee from a bank in Singapore. In order for the bank to issue you a Banker's Guarantee, you need to open a fixed deposit (FD) account for the said amount with bank. Banker's Guarantee must cover 15 months from the start date.
• In addition to the Security Bond, the following documents will be required:
  
  • A clear copy (both sides) of your Singapore ID  (for Singapore Citizens and Permanent Residents) or your Employment Pass.
  • Latest copy of your company's business profile from ACRA
  • A recent passport size photograph
  • Copy of your In-Principle-Approval letter
  • Copy of approval letter from the relevant authority if you will be operating under the HomeOffice scheme
  • A copy of the Certificate for Employment Agencies (CEA) Course, if your company will be involved with the staffing of labour workers.
  • Completed checkList form
  • Any additional documents requested in your In-Principle-Approval letter.

Once you have submitted the necessary documents and assuming all documents are in order, you should receive an email notification approximately within 7 days of submission of the documents stating  that your application is approved. At this point, you will need to make a payment of S$350 for the issuance of the licence. The license will be mailed to the applicant's residential address as indicated in the original application.

Employment Agency Licence - Rejected Applications

Under normal circumstances, if you have accurately submitted your employment agency licence application, there shouldn't be any reason for rejection of your application. If however for some reason your application is rejected, not all is lost. You can submit an appeal letter within 30 days. Your appeal will be reviewed by a senior officer and the processing could take 1-2 weeks. You may be asked to furnish additional documents in support of your application on a case-by-case basis.

Employment Agency Licence - FAQs

Q. How long does it take to process the employment agency licence from start to finish?

A. A practical timeline considering all the steps involved would be about 3-4 weeks as follows:

Q. Do I need to renew the employment agency license? If so, what is the process?

A. Employment agency licence is issued for 1 year at a time and must be renewed on an annual basis. About two months before the expiration date of your license, you will receive a renewal notice from authorities. The renewal notice will be sent to you via email on record. If your email id has changed, you should update it in your licence by using the same online license management portal that you used to submit your original application.

The eligibility criteria for renewal of your Singapore employment agency licence is simple and consists of:

• Your agency must have a good track record i.e. you should not have too many complaints against you and you should not have brokern any laws
• The officers of the company continue to be 'clean' i.e. free of bankruptcy and court convictions  

Other Related Topics

Singapore Immigration | EntrePass | Employment Pass