Skip to main content

Can the cost of housing be counted towards fixed monthly salary?

Yes, but only if you pay it to the worker as part of their basic monthly salary or fixed monthly allowance.

Do note that when assessing the salary criteria for the Market-Based Skills Recognition Framework, we look at fixed monthly salary (basic monthly salary + fixed monthly allowances, before deductions).

You pay your construction worker with 8 years’ experience the following package:

  • Basic monthly salary: $1,350.
  • You also pay the dormitory operator $250 a month for the worker’s stay in the dormitory.

If you wish to include the $250 such that he qualifies for lower levy, you will have to include and declare the $250 as part of his fixed monthly salary (either within his basic salary or fixed allowance).

Thereafter, you can do one of the following options:

Option 1: Ask the worker to pay the dormitory operator directly.

Option 2: Deduct the fixed amount of $250 for providing the worker the accommodation, but make sure that:

  • Your worker agrees to the value of the deduction.
  • The value of the deduction cannot be more than the cost of the housing provided.
  • The deduction for housing cannot exceed 25% of your worker’s salary.
  • The total sum of deductions (e.g. food, housing, transport) cannot exceed 50% of your worker’s salary.

If you do change the value of the deduction, your worker must agree and you must update MOM via WPOL

Do note that if housing (e.g. $250) is added to the basic monthly salary, then the overtime rate should be calculated based on the higher basic salary ($1,600).