Overview of Employment Law in Singapore

The employment law comes from both the legislation passed by Parliament, such as the Employment Act, and the common law, which consists of past cases and precedents.

The Employment Act

The major piece of legislation that influences the terms in an employment agreement is the Employment Act. The Employment Act (EA) sets out a minimum standard of terms and conditions that an employer must abide by when they hire employees covered by the EA.

Part-timers who fall within the scope of the EA may also enjoy the protection of the EA through the Employment (Part-Time Employees) Regulations. Regulations are rules implemented by the relevant government ministry to give effect to the legislation.

If the EA applies, then the employer must comply with the applicable obligations imposed on employers under the EA and provide terms which are no less favourable than those in the EA. If a clause in the employment contract is less favourable than that in the EA, then that clause will be null and void and the relevant provision in the EA will be applied instead.

For example, the payment of salary has to be made at least once a month, and all salary component must be paid within 7 days after the end of the salary period. It will be a breach of the employer’s obligation regardless of what the employment contract says, if the employee is protected under the EA.

Other Legislation

Besides the EA, other pieces of legislation also affect the employment contract. The Child Development Co-Savings Act stipulates obligations on employers regarding maternity leave and maternity pay. The Central Provident Fund Act mandates that companies have to contribute to the CPF accounts of their employees. These are obligations that the employer cannot contract out of.

The Common Law

Aside from employer obligations from the legislation highlighted above, employers also have common law duties.

For example, employers owe a basic duty of trust and confidence to the employee. This duty requires the employer not to, without reasonable and proper cause, conduct himself in a manner that may destroy or damage the relationship of confidence and trust between him and the employee.