Payroll and Benefits Guide Singapore

Employer

Employer Payroll Contributions

Employee

Employee Payroll Contributions

Employee Income Tax

General

Singapore does not have a national minimum wage. However, in recent years, minimum wages are starting to be set for specific industries, such as the cleaning, security, and landscape sectors.

Singapore does have a scheme called Workfare that supports low-wage workers (Singapore citizens) aged 35 and above, who earn a gross monthly income of not more than 2,300.00 SGD. 

Payroll Cycle

The payroll cycle in Singapore is generally monthly, with wages paid before the last working day of each month.

13th Salary

It is customary to pay a 13^th month salary at the end of the year in Singapore.

General

Part IV of the Singapore Employment Act states that the Standard maximum number of working hours in Singapore are 44 hours per week.

Overtime

For employees covered by the Employment Act, overtime work is paid at a rate of at least 15.00% of the basic hourly rate of pay for eligible employees, with a maximum of  12 hours worked in any one day and 72 hours in a month. The maximum monthly overtime pay for an employee classified as a non-workman is f 4,500 SGD and 2,600 SGD for a workman.

The employer must pay overtime within 14 days of the last day of the salary period.

Working Week

Monday–Friday

Paid Time Off

For employees covered by the Employment Act and who have completed at least three months service are entitled to paid annual leave of at least 7 days in their first year,  increasing by one  day for each year of service thereafter.  However, it is common practice for employers to grant  14 – 20 days after the completion of the first year.

Public Holidays

There are 11 public holidays. If a public holiday falls on a non-working day, the employee should either receive a day’s salary in lieu of the holiday or an extra day off. If the holiday falls on a rest day, the upcoming workday will be a paid public holiday.

Sick Days

Once an employee has completed six months of service, the employee is entitled to paid sick leave of
14 days per year if no hospitalization is necessary, or 60 days per year if hospitalisation is necessary; this leave includes 14 days as outpatient care. .

Before completing six months of employment, an employee is entitled to a number of paid sick days depending on the length of employment at the time.

• Up to three months –  five days per year, 15 days if hospitalization is necessary
• Four months –  eight days per year, 45 days in the case of hospitalization
• Five months – 11 days per year, 45 days in the case of hospitalization
• Six months +  – 14 days per year, 60 in the case of hospitalization hospitalised days

The employee must inform their employer within 48 hours of any inability to work and provide a certificate from a medical professional upon returning to work, for any period of sickness.

Maternity Leave

A pregnant employee, employed for at least three months before the due date and the child is a Singaporean citizen, is entitled to 16 weeks of paid maternity leave. The maternity leave consists of two periods:  the woman can take up to 8 weeks before the expected due date but no less than 28 days and the remaining weeks after the baby’s birth.

If the child is not a Singaporean citizen, the maternity leave period is reduced to 12 weeks.

For the first and second child, the first eight weeks are paid by the employer. An additional eight weeks can be reimbursed by the government. However, from the birth of the third child, all 16 weeks of maternity leave are reimbursed directly by the government.

Paternity Leave

The father/partner is entitled to 2 weeks of paid paternity leave after the baby is born, following three months of service, and within 16 weeks after the baby’s birth. This leave is funded by the Government-Paid Paternity Leave (GPPL).

Adoptive fathers are also eligible for Government-paid paternity leave if they meet the eligibility criteria.

Parental Leave

There is no additional parental leave in Singapore.

Other Leave

Bereavement leave

In the event of the death of an immediate family member, although this is not a statutory entitlement, many Singaporean employers allow employees two or three days of paid leave.

Marriage leave

In the event of an employee’s marriage, the employee can take up to five days of leave.

Voting leave

In Singapore, voting/polling day is a public holiday.

Military

Employees are entitled to receive paid Reservist leave on an annual basis when they receive the official Notification of National Service Call Up –SAF 100 issued by the government.

Termination Process

The employer or the employee may end the employment relationship by providing the legally required notice, provided it is not for an illegal reason such as discrimination of  a group protected by law, etc. and it is in accordance with the contract of employment.

Leavers should be paid all outstanding holiday entitlement, assuming the reason for termination is not misconduct. The employer must seek appropriate tax clearance from IRAS before making the final payment.

If the employer terminates the contract or the employee resigns and works the full notice period, payment is made on the last day of employment or within three days if this is not possible.

If an employee resigns without notice and does not work during the notice period, the payment is made within seven days of the last day of employment.

Notice Period

The notice period in Singapore is legislated according to employment length

• Employees who have been employed for less than 26 weeks are required to provide one day’s notice.
• Employees who have been employed for less than 24 months and more than 26 weeks must provide one week’s notice.
• Employees who have been employed for less than 60 months and more than 24 months are required to provide two weeks’ notice.
• Employees who have been employed for more than 60 months are required to provide four weeks’ notice.

During the probation period, the employment can be terminated by either the employer or the employee with five days of notice.

Severance Pay

In Singapore, employment contracts/collective agreements contain “retrenchment benefit” payments due upon termination once an employee has completed two years of service.  It is common practice for this to be  2 – 4 weeks’ pay for each year in employment.

Probation Period

The probation period in Singapore is set within the employment contract/collective agreement and is generally three months.

VISA

Work permits are required in Singapore; however, the type of permit required is based on the person’s skills.  A person with a degree, professional qualifications, or specialist skill will need an Employment Pass to work in Singapore.

In contrast, a Work Permit is required for other skilled or unskilled foreign workers.  The Singapore Ministry of Manpower (MOM) is responsible for issuing of all types of Employment Passes.

Different types of Employment Passes may be issued depending on the applicant’s salary, but the basic procedures remain the same.  An Employment Pass is set by the individual and the company they work for. If an Employment Pass holder wants to change jobs, the employer will have to cancel the existing EP, and the new employer will have to apply for a new one.  The Employment Pass must also be cancelled if the holder ceases employment in Singapore or obtains Permanent Resident status.

General

The standard VAT (Goods and Services Tax) rate is 7.00%

For details regarding hiring in Singapore without a local registered entity see our Singapore PEO service.