Do you have a company and require workers, both local and foreign? Singapore is a global business hub, and entrepreneurs bring in foreign workers to plug supply shortages. Highly skilled workers are often looking for opportunities in Singapore, and employers are always ready to deposit the security bond in exchange for the knowledge and expertise of these professionals.
While Singapore is quite flexible when it comes to the employment of additional workforce to meet the demand, it has set standards that foreign employees need to meet. Employers are expected to follow these guidelines to ensure you get Employment Passes and Security Bond MOM for foreign employees.
Does the Singapore Employment Act cover foreign employees?
The Singapore Employment Act is very specific about the terms of employment, including the rights of employees and the responsibilities of employers. An employee covered in the Act is expected to have an employment contract with aspects covered in the Act.
For example, if the employee earns less than SGD 2000 per month, the law states that he is entitled to additional protection when it comes to overtime, public holidays, rest days, retrenchment benefits, and other variable benefits.
The Ministry of Manpower (MOM) expects you to meet these obligations when applying for the employment pass and security bond.
You may have greater flexibility when drawing a contract with an employee not covered by the Act. ‘In this case, you only need to negotiate the terms with the employee. However, the terms will need to be stated clearly in the employment contract.
Prepare an employment contract
Having an employment contract is critical when hiring, especially foreign workers. When processing work permits and the security bond, MOM assumes you will bear some responsibility should the employee go against the terms of the employment pass.
When drafting the contract, it is best to do it with the help of a lawyer or an HR consultant. Using someone familiar with such contracts will ensure you have everything captured, including acknowledging that the foreign employee understands the terms of the work permit.
MOM is often lenient to employers who can prove that they discussed terms of the work permit with the employee. This may save you from forfeiting the security bond MOM should the employee go against the terms of the work permit.
Other aspects that need to be covered in the contract include the appointment position, contract duration, remuneration package, benefits, probation clause, and code of conduct. This will protect the employer and employee in case of any disputes.
Only hire the permitted number of foreign workers.
The industry’s quota system dictates the number of foreign workers each employer can employ at any given time. MOM has details of the number of work permits allowed for every industry, depending on the industry’s shortage.
You need to keep track of the quota system to ensure you hire the foreign employees you need early. You also need to start processing work permits and submit the security bond MOM to secure the place of the foreign workers you need. The workers also need to be ready to arrive in the country within the required period after the employment pass is issued.
Singapore occasionally sees a rise in demand for foreign workers. Like other developed countries, sometimes the local market cannot fully meet the demand for skilled and unskilled workforce.
As an employer, you need to analyze your business to determine when you may need more workers and for what period. This will help you plan for the number of foreign workers you need and how much you need for their security bond.