Employment (Amendment) Bill
- MOM announced in 2014 that the Ministry would require employers to issue itemised payslips and key employment terms (KETs) in two years. This Bill puts these requirements into law. The Bill also sets up an administrative penalty framework to make less severe breaches of the Employment Act (EA) non-criminal. It also makes other clarifications and amendments to the EA.
Summary of key proposed changes
- Enacted in 1968, the EA is Singapore’s main employment law. It provides for the basic terms and working conditions for employees, while balancing employers’ need to stay competitive. This Bill builds on the changes to the EA introduced in 2013.1 Key changes are outlined below.
Itemised Payslips and Key Employment Terms
- Itemised payslips. MOM will require employers to provide itemised payslips to all their employees covered under the EA together with their salary payments. Employers however have some flexibility, including whether to issue the payslips in soft or hard copy, as long as they reflect the required breakdown of items; as well as the ability to consolidate payslips if payments are made more than once a month2 (see Annex A for details).
- KETs. MOM will require employers to provide written KETs to all employees covered under the EA with continuous employment of at least 14 days with the company. Employers will also have some flexibility in how they provide the KETs as long as the required items are clearly accessible (see Annex B for details).
- Taken together, itemised payslips and KETs provide greater clarity and assurance to employees about their regular salary components as well as their main employment terms and benefits. They also help employers prevent misunderstandings and minimise disputes at the workplace.
- Help available. Since April 2014, MOM has been working with IDA and SPRING as well as the tripartite partners to provide employers with the tools to issue payslips and KETs in writing. Employers can continue to tap on the assistance package, including blank payslips and KETs that can be filled in by hand, free software, one-to-one hands-on assistance for SMEs, and funding (see Annex C for details).
Administrative Penalty Framework
- Currently, all breaches of the EA are criminal offences. Together with the introduction of itemised payslips and KETs, MOM will also set up a framework to treat the less severe breaches as “civil breaches” which attract administrative penalties. For a start, the breaches will include:
(i) Failure to provide itemised payslips
(ii) Failure to provide written KETs
(iii) Failure to keep detailed employment records
(iv) Provision of inaccurate information without fraudulent intent to the Commissioner for Labour or inspecting officers3
- Other breaches of the EA which relate to provisions safeguarding employment standards will remain criminal offences.
- MOM intends to effect these new requirements on 1 April 2016. However, in view of strong feedback from the smaller SMEs who will be most affected by these changes, we will give employers a one-year grace period. During this time, MOM will adopt a light-touch enforcement approach, focusing on helping employers to meet these requirements.
1 In 2013, MOM introduced a series of changes to the EA to extend better protection to more workers, accord flexibility to employers in areas where there are practical business concerns, and enhance enforcement and compliance with the EA. These enhancements came into effect on 1 April 2014.
2 Under the EA today, employers have to pay employees their salary at least once a month. Under this new requirement, employers who make multiple payments within a month must issue a payslip at least once a month.
3 Provision of inaccurate information to the Commissioner for Labour or inspecting officers is currently a criminal offence under the EA. While provision of inaccurate information without fraudulent intent will now attract administrative penalties, wilful provision of fraudulent information will remain a criminal offence.