Written Answer by Mr Lim Swee Say, Minister for Manpower, to Parliamentary Question on mandatory insurance cover for contract workers
Notice Paper No. 425 Of 2016 For The Sitting On 7 November 2016
Question No. 718 For Oral Answer
MP: Ms Chia Yong Yong
To ask the Minister for Manpower whether there are any plans to protect contract workers with mandatory insurance cover to be purchased by companies contracting their services, particularly health, personal accident and life insurance.
Answer
- Contract workers can be under “contracts of service” or “contracts for service”. A contract of service is defined by an agreement between an employer and an employee which includes the terms and conditions of employment. In a contract for service, an independent contractor, such as a self-employed person or a freelancer, is engaged for a fee to carry out an assignment or project.
- All local employees who are under contracts of service are entitled to have medical benefits through mandatory employer and employee Medisave contributions. Employees can use these Medisave contributions to pay for MediShield Life and Integrated Shield Plans premiums. In addition, all employees are also eligible under the Work Injury Compensation Act for work injury compensation if they are injured at work or if they contract an occupational disease.
- Companies who contract services from self-employed individuals under contracts for service are not required to buy insurance for these individuals. This is because there is no employer-employee relationship between them. Nonetheless, self-employed persons are required to contribute to their CPF Medisave accounts if they earn an annual net trade income of more than $6,000. These contributions can likewise be used to pay premiums for MediShield Life and Integrated Shield Plans.
- Contract workers who are under contracts of service can contact MOM for assistance if they are not provided with statutory benefits that they are entitled to.