Key Proposed Changes to Employment Act That You Need to Know

Information taken from Ministry of Communication and Information

Minister for Manpower, Mr Lim Swee Say, laid out his Ministry’s plans to enhance the current Employment Act (EA) framework in his Committee of Supply speech on 5 Mar 2018.

Key highlights:

  • Salary threshold for coverage of core employment provisions to be removed
  • Salary threshold for non-workmen to increase to $2,600, up from $2,500
  • Employment Claims Tribunal would now hear wrongful dismissal claims as a one-stop avenue for employers and employees (previously heard by MOM)

Removal of EA salary cap

The removal of the salary cap of the EA will now cover all employees, including all PMETs. The exceptions are public servants, domestic workers, seafarers and those who are covered separately (such as by other Acts due to their nature of work).

The core employee benefits in the EA will also be extended to all employees, which will cover an additional 430,000 PMEs:

  • Minimum 7 days of annual leave
  • 11 paid public holidays
  • 14 days of paid sick leave and
  • 60 days of paid hospitalisation leave

Employees covered by the Act will also enjoy other protection, including:

  • Timely payment of salary
  • Maternity protection and childcare leave
  • Statutory protection against wrongful dismissal
  • Right to preserve existing terms and conditions for employment transfer
    • Resulting from sale of business
    • And business restructuring

Additional protection on work hours and overtime pay

The additional protection on hours of work and overtime pay will be extended to more workers. This enhancement will extend coverage to half of Singapore’s workforce.

  • For Workmen^, no change
    • Current salary cap of $4,500
    • Already covers >99% of workmen
  • For Non-workmen
    • Current cap of $2500 will be raised to $2600

For overtime pay, the salary cap for non-workmen will be revised from $2250 to $2600 to benefit about 100,000 workers.

Changes to dispute resolution

Currently, all salary-related disputes are mediated at the Tripartite Alliance for Dispute Management (TADM), unresolved claims are heard at the Employment Claims Tribunals (ECT), and wrongful dismissals are adjudicated by MOM.

Moving forward, wrongful dismissals will be shifted over to the Employment Claims Tribunals to provide both employers and employees with “one-stop service”.

The Ministry of Manpower will seek parliament’s approval of these amendments to the Employment Act (EA) later this year, for implementation by 1 April 2019.

^Workmen are defined as people who do manual labour

  1. Good tracking of performance ( ie appraisal to manage performance, important if there is dispute

Say wrongful dismissal etc)

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