Employees earning more than $4,500 per month to be covered by the widened Employment Act

Following a review by the Ministry of Manpower (“MOM”) together with its tripartite partners, National Trade Union Congress (“NTUC”) and Singapore National Employer’s Federation (“SNEF”), the Employment Act (“EA”) will be widened to cover employees earning more than $4,500 a month. The changes are likely to be tabled in Parliament in September and will be implemented by 1 April 2019. The additional protection afforded by the enhanced EA will be as follows:-


Additional Protection for Employees

1.   Extending Core Provisions of the EA to cover all employees

The Core Provisions of the EA governs public holiday and sick leave entitlements, timely payment of salary and allowable deductions, maternity protection, and redress for wrongful dismissal. At present, these provisions cover all employees except for domestic workers, public servants, seafarers and managers and executive earning more than a basic monthly salary of $4,500.

As an increasing number of managers and executives earning more than a basic monthly salary of $4,500 make up Singapore’s workforce, MOM has decided to extend the core provisions to remove the salary cap and include managers and executives.

2.   Additional protection for more vulnerable employees

Part IV of the EA provides additional protection for more vulnerable employees relating to rest days, hours of work, overtime work and annual leave. At present, these provisions cover non-workmen (employees in “white collar” occupations, e.g clerk, receptionist, retail sales assistant, etc) earning up to $2,500 a month and workmen (employees engaged in manual work, e.g cleaner, construction worker, labourer, machine operator, train/bus/lorry/van driver, etc) earning up to $4,500 a month. MOM has decided that more rank and file workers will receive these additional protections. The salary cap will be increased to $2,600 a month for non-workmen.

3.   Enhance dispute resolution services

Currently, the Employment Claims Tribunal hears statutory and contractual salary related disputes while MOM hears wrongful dismissal claims. However, as most wrongful dismissal claims involve salary-related disputes as well, aggrieved parties had to go to two separate bodies. The incoming changes will allow the Employment Claims Tribunal to hear wrongful dismissal claims as well, thus allowing employees to go to the Employment Claims Tribunal to address both issues.


Concluding note

The amendments afford better protection to professionals, managers, and executives (“PMET”) earning more than $4,500, benefiting 430,000 more employees in the Singapore workforce. The increased salary cap for rank and file workers would cover half the workforce.

Prior to the proposed amendments to the EA PMETs earning more than $4,500, who do not work for unionised companies, had limited avenues to seek recourse should they face a workplace grievance. These PMETs would have had to commence a civil suit or undergo voluntary mediation should negotiations with their employers not be fruitful. With the proposed changes, these PMETs will now have more avenues to seek redress. They would be able to appeal to MOM to have the company reinstate their jobs in cases of wrongful dismissal.

It would be important for companies to take note of the enhanced statutory protection afforded to all employees and may wish to review their Human Resource policies to ensure that the company’s policies do not fall short of the statutory standards.

Should you require assistance on the same and/or have any queries pertaining to this article, please feel free to contact Straits Law’s employment law team – Mr Joseph Liow at joeliow@straitslaw.com.sg or Ms Celine Liow at celineliow@straitslaw.com.sg  or the Straits Law Director who usually attends to your matters.