Employment Agency Fined $3,000 for Overcharging Workers
EA also ordered to compensate workers $6,600 in total
28 June 2013
- In the Subordinate Courts on 20 June 2013, Gateway Employment Agency ("Gateway") was convicted and fined $3,000 for collecting excessive agency fees from three workers.
- Gateway was also ordered to compensate the workers a total of $6,600. Gateway faced a total of three counts of overcharging agency fees, with one charge proceeded on in court, and the remaining two charges taken into consideration during sentencing. The Ministry of Manpower (MOM) has suspended Gateway's employment agency licence.
Facts of the Case
- In March 2012, a Chinese national Luo Yuandong, who had been working with Panasonic Refrigeration Devices Singapore Pte. Ltd. (Panasonic), sought assistance from Allan Choa Sin Choy (Allan), an employment agency personnel of Gateway, to facilitate the employment of his brother Luo Yuanhua, and his friend Liu Gengzhao, with Panasonic. Luo Yuandong was told that the agency fee would be RMB 15,000 (equivalent to approximately SGD $3,000) for each applicant. Luo Yuandong paid the full sum of RMB 30,000 to Allan on behalf of Luo Yuanhua and Liu Gengzhao when their permits were approved in May 2012.
- During investigations, it was revealed that Allan also collected RMB 18,000 (equivalent to approximately SGD $3,600) from another foreign worker, Zhao Yonggang, for placing him in employment.
- In these three cases, Gateway collected agency fees of between RMB 15,000 and RMB 18,000, and these amounts exceeded the limits allowed under the Employment Agencies Act (EAA). Licensees and employment agency personnel who are convicted for overcharging agency fees face a fine of up to $5,000. Those who re-offend may be jailed for not more than six months in addition to being fined. EAs which have been convicted of any offence are liable to have their licences revoked. Key appointment holders from these EAs will also be barred from entering the EA industry in future.
Another EA convicted for overcharging agency fees
- This is not the first case of EAs overcharging agency fees. On 21 February 2013, Joy Recruitment Pte. Ltd. (Joy) was the first EA convicted for overcharging a foreign worker by collecting excessive agency fees. Joy was fined a total of $2,500.
Advisory from MOM
- A fee cap is in place to protect vulnerable rank and file workers who have weak bargaining powers. EAs cannot charge employees a fee exceeding one month of their salary, for each year of the approved work pass duration or employment contract, whichever is shorter, subject to a maximum of two months' salary.
- MOM advises all EA personnel to comply with the EAA and to abide by the Employment Agency Licence Conditions. EAs should carry out their EA activities legally and responsibly.
- Members of the public who are aware of any EAs that are overcharging agency fees should contact MOM at Tel: (65) 6438 5122 or email firstname.lastname@example.org. All information will be kept strictly confidential.