NNRoad provides top tier employee leasing or Employer of Record (EOR) services for clients who may want to hire employees in Singapore without a legal entity in the country.
- PEO/Employer of Record Services in Singapore
- What to Know Before Hiring Employees in Singapore
- Employment Contracts in Singapore
- HR and Labor Laws in Singapore
- Payroll Service Options in Singapore
- Social Security Contributions
- Individual Income Tax
- Employee Termination
- Probation Period
- Public Holidays/Rest Days
- Hiring Employees in Singapore
PEO/Employer of Record Services in Singapore
NNRoad acts as a Professional Employment Organization (PEO) in Singapore to ensure all employment responsibilities such as employment contracts, payroll, individual income tax, and social security contributions are in compliance with Singapore’s Labor Laws.
Essentially, employees hired in Singapore are legally and administratively employed by NNRoad/our partner but will be working on your company’s behalf.
What to Know Before Hiring Employees in Singapore
On April 1st, 2019, Singapore’s Employment Act was revised. Here is what changed:
Covering All Employees Under the Employment Act
Managers and executives with a monthly basic salary of more than SGD 4,500 will be covered by the Employment Act. Beforehand, they were not covered by the Employment Act.
This means that all employees in Singapore, with the exception of seafarers, domestic workers, and public officers, will be covered for core provisions such as:
- Minimum days of annual leave
- Paid public holidays and sick leave
- Timely payment of salary
- Statutory protection against wrongful dismissal
Contact NNRoad today to hire employees in Singapore!
Employment Contracts in Singapore
It is recommended to have a written employment contract in Singapore. Best practices include spelling out an employee’s compensation, benefits, and termination requirements.
Always include the employee’s salary and compensation amounts in Singapore currency. An employee can be employed in the following terms:
- Full-time
- Part-time
- Temporary
- Contract
HR and Labor Laws
Working Hours
An employee shall not be required under his contract of service to work:
- More than 6 consecutive hours without a period of leisure (of at least 45 minutes break)
- More than 8 hours in one day or more than 44 hours in one week.
- Unless specially exempted, employees cannot work more than 12 hours per day or 72 hours of overtime in one month.
Minimum Wage
- The Employment Act does not regulate the minimum salary every employee must be paid.
- In other words, there is no minimum salary requirement and it is subject to negotiation between the employer and the employee.
- However, the salary must be paid at least once a month within 7 days after the end of the salary period
- Overtime pay, if applicable, must be paid within 14 days of the stipulated salary period.
- There is no requirement of bonus payment under the Employment Act of Singapore.
Payroll Service Options in Singapore
- Remote: Non-resident companies may choose to put their Singapore employees on their payroll. Local regulations may make this difficult. One option for non-resident companies to outsource payroll responsibilities to a payroll service company such as NNRoad on your behalf.
- Internal: For large companies who plan to be in Singapore long-term. Companies require a larger budget to hire employees to work in HR if they select this option.
- Singapore Payroll Processing Company: Companies may choose to work with a payroll company inside Singapore. This requires an entity set up in Singapore. While still outsourcing, you still must be compliant with Singapore’s laws.
- Payroll via NNRoad: Companies can fully outsource employment and payroll through NNRoad. It is the fastest, safest, and easiest option to pay your employees in Singapore.
Social Security Contribution Rates
- Social security or Central Provident Fund (CPF) contributions are mandatory for Singapore citizens and Singapore permanent residents (“SPRs”) who are employed in Singapore.
- Foreign individuals working in Singapore are not eligible for the CPF scheme.
The contribution rates for different age groups and SPR status are as shown in the table below:
Individual Income Tax Rates
Singapore follows starting at 0% and ending at 22% above SGD $320,000 as below:
| Chargeable Income | Income Tax Rate (%) | Gross Tax Payable (SGD) | Total Income Tax in this income bracket |
| First SGD $20,000
Next SGD $10,000 |
0 2 |
0
200 |
200 |
| First SGD $30,000
Next SGD $10,000 |
–
3.50 |
200
350 |
550 |
| First SGD $40,000
Next SGD $40,000 |
–
7 |
550
2,800 |
3,350 |
| First SGD $80,000
Next SGD $40,000 |
–
11.50 |
3,350
4,600 |
7,950 |
| First SGD $120,000
Next SGD $40,000 |
–
15 |
7,950
6,000 |
13,950 |
| First SGD $160,000
Next SGD $40,000 |
– 18 |
13,950
7,200 |
21,150 |
| First SGD $200,000
Next SGD $40,000 |
–
19 |
21,150
7,600 |
28,750 |
| First SGD $240,000
Next SGD $40,000 |
–
19.50 |
28,750
7,800 |
36,550 |
| First $280,000
Next SGD $40,000 |
–
20 |
36,550
8,000 |
44,550 |
| First SGD $320,000
In excess of SGD $320,000 |
–
22 |
44,550 | – |
Income Tax for Non-Residents
- There is a flat income tax rate for Non-Residents.
- For employment income, tax is charged at a flat rate of 15 percent or at the resident rates, whichever is higher.
- Other income of a non-resident individual is generally taxed at 22%
Employee Termination Policies
Employment termination guidelines as stipulated in the Employment Act is applicable to those employees protected under the Act. The table below illustrates the circumstances under which a contract can be terminated:
| Employer Initiated Termination | Employee Initiated Termination | Natural Termination |
|
|
|
Termination Guidelines
Termination with Notice Period
| Length of Service | Notice Period |
| Less than 26 weeks | 1 day |
| 26 weeks to less than 2 years | 1 week |
| 2 years to less than 5 years | 2 weeks |
| 5 years or more | 4 weeks |
- Employees who have fully served the required notice period, are entitled to Central Provident Fund (CPF) contributions for the notice period salary that they receive.
Termination without Notice Period
- Either you or your employer may terminate employment without notice when the terms of employment have been breached.
- The party that breached the terms of employment must pay compensation in lieu of notice.
Probation Period
The Employment Act of Singapore does not require a probation period for an employee. In Singapore, it is common that employees are asked to serve a probation period ranging from 3 to 6 months.
Public Holidays/Rest Days
New Year’s Day – January 1
Chinese New Year – January 25-26
Good Friday – April 10
Labour Day – May 1
Vesak Day – May 7
Hari Raya Ruasa – May 24
National Day – August 9
Deepavali – November 14
Christmas Day – December 25
Hire Employees in Singapore with NNRoad
Singapore’s Employment Act contains strict employee protections, which require close attention to detail and having a solid understanding of local labor practices.
Singapore is also a very lucrative market to expand your business. Check out our 3 Crucial Asian Markets to Do Business in the blog post to see what makes Singapore an ideal place to set up a company.
NNRoad can help you handle HR matters, the entity set up, tax and accounting, and payroll in Singapore all the while ensuring you are in compliance with local labor laws.
