The Employment Act: Who it covers
- From 1 April 2014, persons employed in managerial and executive positions earning a basic monthly salary not exceeding $4,500 will be covered under the Employment Act, except for the provisions in Part IV.
- From 1 April 2014, non-workmen employees earning a basic monthly salary not exceeding $2,500 will be covered under Part IV of the Employment Act.
Who is covered by the Employment Act
The Employment Act covers every employee (regardless of nationality) who is under a contract of service with an employer, except:
- Any person employed in a managerial or executive position
- Any seaman;
- Any domestic worker; and
- Any person employed by a Statutory Board or the Government.
Part IV of the Act, which provides for rest days, hours of work and other conditions of service, applies only to:
- Workmen earning not more than $4,500 basic monthly salaries; and
- Other employees (other than workmen) covered under Employment Act earning not more than $2,000 basic monthly salaries (Note: basic salary excludes overtime, bonus, Annual Wage Supplement, productivity incentive payment, reimbursement for special expenses and any allowances).
Note: Part IV of the Employment Act does not cover Professionals, Managers and Executives (PMEs).
Managers & executives
Managers and executives are employees with executive or supervisory functions. These functions include the authority to influence or make decision on issues such as recruitment, discipline, termination of employment, assessment of performance and reward, or involvement in the formulation of strategies and policies of the enterprise, or the management and running of the business.
They also include professionals with tertiary education and specialised knowledge/skills and whose employment terms are comparable to those of managers and executives. Professionals such as lawyers, accountants, dentists and doctors whose nature and terms of employment are comparable to executives would generally be deemed as such, and hence they would not be covered under the Act.
Junior managers and executives earning $4,500 basic monthly salary and below are only covered partially on the basic payment of salary. All other provisions do not apply to them.
A workman is an employee whose work involves manual labour. This includes a worker who falls under any of the following categories:
- Any person, skilled or unskilled, doing manual work, including any artisan or apprentice but excluding any seaman or domestic servant;
- Any person, other than clerical staff, employed in the operation or maintenance of mechanically propelled vehicles that transport passengers, for hire or commercial purposes;
- Any person employed to supervise any workman and perform manual work. However, this is subject to the requirement that the time spent on manual work must be more than half of the total working time in a salary period; or
- Any person specified in the First Schedule of the Employment Act, namely:
- Construction workers;
- Machine operators and assemblers;
- Metal and machinery workers;
- Train,bus, lorry and van drivers;
- Train and bus inspectors;and
- All workmen employed on piece rates at the employer's premises.
It covers both local and foreign employees. It does not make any distinction between a temporary employee, contract employee, daily-rated employee or employee on tenured employment.
For employees working less than 35 hours a week, they are covered by the Employment of Part-Time Employees Regulations, which provide certain flexibility for both the employers and employees, including the pro-rating of employment benefits, encashment of annual leave and provision of rest day.