Your Guide to Employment Agreements in Singapore
What is an Employment Agreement?
Employment agreements (also known as contracts of service) set out the terms governing the relationship between an employer and an employee. Without a solid and comprehensive employment agreement in place, employers may find their business mired with ill-disciplined workers and frequent employment disputes.
Validity of Employment Agreements
The employment agreement of an employee covered by the Employment Act cannot contain any terms less favourable than the minimum standards stated in the Employment Act. If such terms are present in the employment agreement, these terms will be considered void and illegal.
For example, the Employment Act stipulates a minimum of 7 days’ paid annual leave for employees who have completed their first year of service. The employer therefore cannot include a term providing the employee with only 6 days’ of paid annual leave in the employment agreement.
Key Employment Terms (KETs)
Key employment terms (KETs) refers to essential terms of employment contained in a contract of service between the employer and the employee.
Who Must KETs be Issued to?
All employers must issue KETs in writing to employees who:
- Enter into a contract of service on or after 1 April 2016
- Are covered by the Employment Act
- Are employed for 14 days or more with regard to their length of contract (not the number of days of work)
KETs must be issued within 14 days from the start of employment. It can be given in soft or hard copy, including handwritten.
What Must the KETs Include?
The following items must be included in the KETs, unless the item is not applicable:
- Full names of employer and employee
- Job title, responsibilities and main duties of employee
- Commencement date and duration of employment (if employee is on a fixed-term contract)
- Working arrangements (working hours and days, and rest days)
- Salary period (e.g. hourly, weekly or monthly) and basic salary (including basic rate of pay for hourly, daily or piece-rated workers)
- Fixed allowance and deductions
- Overtime payment period (should it vary from the salary period) and overtime rate of pay
- Remunerations (bonuses, incentives)
- Type of leave (annual leave, sick leave including outpatient and hospitalisation, maternity/paternity leave and childcare leave)
- Other medical benefits (e.g. insurance or dental)
- Probation and notice period
- (Optional) Work location
For example, if the employee is a Professional, Manager or Executive (PME), the KETs issued to that particular employee do not need to include item 7 on overtime pay. This is because PMEs are not entitled under the Employment Act to overtime pay.
Other Essential Employment Terms
Apart from these KETs, other essential employment terms include terms on non-disclosure, non-competition and employee code of conduct.
Hiring Part-Time Employees
Employers intending to hire part-time employees have to include certain special requirements in their employment agreements. Find out more about these requirements here.
Employment Agreement Template
Need an employment agreement template? You can get one here.
(Use the discount code shown when you enter your email address below)
- Your Guide to Non-Disclosure Agreements in Singapore
- Your Guide to Employment Agreements in Singapore
- Your Guide to Tenancy Agreements in Singapore
- Your Guide to Shareholder Agreements in Singapore
- Your Guide to Partnership Agreements in Singapore
- Your Guide to Distributor Agreements in Singapore
- Your Guide to Consultancy Agreements in Singapore
- Your Guide to Freelance Service Agreements in Singapore
- Your Guide to Service Agreements in Singapore
- Your Guide to Business Referral Agreements in Singapore
- How to Change (or Amend) a Contract in Singapore
- How to Legally Use E-Signatures in Singapore Contracts
- Privity of Contract & When a Third-Party Can Sue You in Singapore
- How to Properly Draft a Contract in Singapore (DIY Guide)
- How to Recover Damages For Breach of Contract in Singapore
- Enforcing Verbal Agreements in Business Contracts
- Requisite elements in the formation of a contract
- Entire Agreement Clauses in Singapore: What are They and What Do They Do?
- Guide to Indemnity Clauses in Singapore Commercial Contracts
- What are Warranties, Conditions and Innominate Terms?
- Implied Terms: Filling in "Gaps" in a Contract
- Breach of Contract in Singapore
- Using Force Majeure/Frustration to Escape Contracts in Singapore
- What is the governing law of a contract?
- Punitive Damages in Singapore Contract Law