Singapore’s amended Employment Act to take effect from April 2019

Singapore’s Employment (Amendment) Bill 2018 was passed on 20th November, 2018 after being read in parliament for a second time by Minister of Manpower, Josephine Teo. The bill made amendments to the Employment Act (EA) and Employment Claims Act (ECA) and will be taking effect from 1st April, 2019.

A major change would be that now core provisions would be provided to all professionals, managers, executives and technicians (PMETs). These provisions cover the minimum days of annual leave, paid public holidays and sick leaves. Beside this, all PMETs would also be protected in terms of timely payment of salary and wrongful dismissal. At present, these core provisions are enjoyed only by three groups - workmen (manual workers or blue-collar workers), non-workmen (rank-and-file white-collar workers) and managers and executives (M&Es with basic monthly salaries up to S$4,500). Moreover, the proportion of PMETs is expected rise to constitute around 66% of Singapore’s workforce by 2030 urging the Government to remove the S$4,500 salary cutoff for M&Es.

Minister Teo stated that in doing so, “all employees – whether M&Es, workmen or non-workmen – will be covered by core provisions under the Act. This will benefit an additional 430,000 M&Es.”

More employees would now also have access to a list of additional securities.These take into consideration hours of work, rest day and payment for overtime. At present, only workmen earning up to S$4,500, and non-workmen earning up to S$2,500 (together constituting Part IV employees) were covered under these protections. These improvements are aimed and predicted to benefit an additional 100,000 workers.

The next set of reforms look at increased flexibility for both employers (to help meet business requirements better) and for employees (like giving more employees the option of taking time off for working on public holidays).

At present, workmen and non-workmen who work on public holidays are entitled to one of only two options – either get compensated with an extra day’s pay, or get a full day off-in-lieu. Employers will now be able to grant workmen and non-workmen (not part of the Part IV group) time off for hours worked on a public holiday, rather than giving a whole day off. Thus, the idea is to ensure that all employees will be compensated for working on public holidays.

The Employment Act will now hold a less prescriptive stance for authorized deductions. While till now, employers could only make salary deductions for a limited number of reasons, now they can make deductions for a variety of reasons that employees consent for. This also allows the employees to withdraw their consent without being penalized.

Amendments to any act often come with confusion, complexities in execution and pushback even if they are designed for the best. This holds even truer with regard to employment acts since both the employers and employers tend to regard the government as a third disconnected party that is divorced from both their best interests. In country like Singapore, however, where the government not only holds significant power over manpower decisions but has also proven its effectiveness over time, the implementation could be a lot smoother, the success seen a lot sooner and the benefits could thus be reaped a lot faster.

Image source: www.humanresourcesonline.net