As effective from1 April 2014, we would like to highlight some important changes to employment law in Singapore that may affect your organisation’s employment policies and practices.

These changes came about on 11 November 2013 when the Parliament passed the Employment, Parental Leave and Other Measures Act 2013 (“the Act”). The Act brings some key changes to the Employment Act (Cap.91) in order to enhance employment protection for workers and employment flexibility for employers.

Old Position

Organisations that have employees in Professional, Managerial and Executive (“PME”) roles earning a basic salary of $4,500 or less are only regarded as an employee for the purposes of certain sections under the EA.

Non-workmen employees (e.g. clerical staff) that earn a basic monthly salary of up to 2000 are covered under Part IV of the EA.

New Position after 1 April 2014

“PME” employees which earn a basic monthly salary of up to $4,500 are now covered under the general provisions of the EA

The qualifying salary threshold has been revised up to $2500 for those to be covered under Part IV of the EA.

Employee Rights

Non-workmen employees earning up to $2000 are statutorily obliged to be paid for overtime work.

The qualifying salary threshold has been amended so that for those earning between $2001 and $2500 will now be able to claim for overtime work done. However, the overtime rate payable of non-workmen is capped at $2,250.

PME Employees who are terminated in line with the terms of their employment contract had limited recourse.

PME employees earning up to S$4,500 who have serves with the same employer for at least 12 months can seek redress against unfair dismissal where notice is given.

A 50% cap on total authorised deductions from employees’ salaries.

Any deductions cannot exceed 25% of the employee’s salary for accommodation, amenities, or services rendered in any one salary period. This sup-cap is within the current 50% total cap for authorized deductions.

Enforcement

An employer that fails to pay salaries will face a fine not exceeding $5,000 or up to 6 months’ imprisonment for the first offence.

The penalty for failure to pay salaries is increased. For the first offence, not less than $3,000 and not more than $15,000 and/or imprisonment for up to 6 months.

The cap for maximum composition fine was $1,000.

The maximum composition fine is now $5,000.