Singapore Employment Act Update Better Protection Underway for Management Positions

The government will be conducting a review of the Singapore Employment Act to update it accordingly with the evolving workforce and economic landscape.

In response to the evolving employment market conditions, and to ensure that the labour laws remain relevant in the current landscape, the Ministry of Manpower (MOM) last year announced their review of the Employment Act (EA), which is being conducted in two phases.

The outcome of the first phase was announced this week, in response to an 8-week public consultation exercise and extensive evaluation by Singapore’s labour movement and the numerous stakeholders.

Professionals, Managers and Executives (PMEs) can look forward to better legal protection under Singapore labour laws. Singapore’s key labour legislation is the Employment Act , which regulates basic employment terms and conditions, and shapes the responsibilities and relationships between employers and employee.

Currently, the EA only protects junior PMEs earning basic monthly salaries of $4,500 or below, and only in respect of salary payments. However, given the growing proportion of PMEs in Singapore’s entrepreneurial landscape, and the rising income levels, it is fairly uncommon for PMEs to fall under this protection.

One of the key changes affecting junior PMEs is that their protection under the EA will be extended to cover other provisions in addition to salary-protection, such as sick leave benefits and protection against unfair dismissal. This change is expected to benefit about 300,000 PMEs.

Other changes include the increase of salary threshold for non-workmen to enjoy protection relating to working hours, from $2,000 to $2,500, as well as further measures to raise employment standards without imposing rigidity in the labour market.

MOM intends to introduce the EA Amendment Bill in Parliament in the second half of this year, and when it passes, to implement the changes in the first half of 2014. The second phase of the review will be conducted later this year, and will cover employees in non-traditional work arrangements, such as contract workers and self-employed persons.

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