Singapore
Singapore’s a melting pot for some of the most talented people in the world. In the next five minutes, we’ll teach you how to hire there—without spending thousands of dollars on EOR fees and legal red tape:
Country snapshot
CURRENCY
Singapore Dollar (SGD)
EMPLOYER TAXES
Up to 17.25%
PAYROLL FREQUENCY
Monthly
OFFICIAL LANGUAGE
English, Malay, Tamil and Mandarin Chinese
It’s the fastest way to hire globally
Hiring employees takes months, at the minimum. When you hire with Thera's locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.
It’s a lot cheaper
It costs just $0 to sign up for Thera, then $25 per month to hire your contractors with Thera. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.
It’s more flexible for you & your team
Can be less risky than hiring employees
Hiring employees is a bigger commitment, and can open you up to increased liabilities and regulations. When you hire contractors overseas, your biggest risk is misclassification—but laws surrounding contractor classification are often significantly more straightforward.
Some people want to be employees
The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.
You might not have as much control over your talent
Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.
Laws about hiring are complicated, and the same is true in Singapore. But there are ways to sidestep the headaches—if your company hasn’t already established a physical presence in Singapore, you have two real options when it comes to hiring. We’ll detail both below.
Hire talent as contractors
Hire talent as employees
If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in Singapore than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in Singapore.
Employer tax
CPF (Pension)
Skills Development Levy (SDL)
Individual tax
up to 20,000 - 17%
above 320,000- 22%
Paid Time Off (PTO)
PTO is calculated by the:
- Employees are entitled to a minimum of 7 days of annual leave after working in a company for three consecutive months.
- Afterward one additional day is added per each year until reaching 14 days at the 8th year.
- However, it is common that the employee receives 14 to 20 days of annual leave.
Public Holidays
There are 11 public holidays. If a public holiday falls on a non-working day, the employee should either receive a day’s salary in lieu of the holiday or an extra day off. If the holiday falls on a rest day, the upcoming workday will be a paid public holiday.
Sick Days
The duration of sick leave entitlement provided to workers is dependent on how long they have been employed by their employer:
- 0-3 Months: 5 non-hospitalized/15 hospitalized days
- 4th Month: 8 non-hospitalized/30 hospitalized days
- 5th Month: 11 non-hospitalized/45 hospitalized days
- After 6 Months: 14 days non-hospitalized/60 hospitalized days
The employee must inform their employer within 48 hours of inability to work and must provide a medical certificate upon return.
Maternity Leave
Paid maternity leave of 16 weeks is provided to female employees employed for more than 3 months prior to giving birth and the child is a Singaporean citizen. During this period, employers are prohibited from terminating the employment.
For the first and second child, the first 8 weeks are paid by the employer and additional 8 weeks can be reimbursed by the government.
For the birth of the third child and more, all 16 weeks of maternity leave can be reimbursed by the government.
If the child is not a Singapore citizen, maternity leave is 12 weeks
Paternity Leave
Paternity leave in Singapore is 2 weeks. To meet the requirements of Government-paid Paternity Leave (GPPL), the child must be a Singapore citizen and the father has or was legally married to the mother between the conception and birth of the child.
In the case the child is adopted, the father is also eligible for paternity leave if the child is a Singapore citizen.
Parental Leave
Parents are entitled to 6 days paid childcare leave yearly if their youngest child is below the age of 7 and a citizen of Singapore.
Other Leave
Work-Related Injury Leave – The employer covers all work-related injuries that an employee has suffered either directly or through insurances.
The employee should receive 100% of their average monthly earnings in the 12 months prior to the disability for 14 days if not hospitalized.
After 14 days they shall receive 66.7%. As of September 1, 2020, all work-related medical leave must be reported to the Ministry of Manpower.
Marriage Leave
Marriage Leave is Not a Statutory Entitlement Under the Singapore's Employment Act.
Most companies offer paid leave if it is for just a few days, but may offer part-paid or unpaid if the bride or groom plans for longer periods of time.
The standard amount of paid days off given by companies is usually 3 days.
Bereavement Leave
Singapore law does not mandate compulsory compassionate leave. The common practice is to offer at least 2 to 3 days of paid compassionate leave.
Termination Process
In the event of a termination of a local employee, the employee’s salary must be paid:
Employee resigns and serves the notice period: On the last day of employment
Employee resigns without notice and no notice period is served: Within 7 days of the last day of employment
Termination due to misconduct: On the last day of employment, however, if this is not possible, the employee must be paid within 3 business days.
Employer terminates the employment contract: On the last day of employment, however, if this is not possible, the employee must be paid within 3 business days.
Notice Period
The notice period in Singapore is:
1 day notice for less than 26 weeks of employment
1 week notice for employees who have been employed more than 26 weeks and less than 2 years
2 weeks’ notice for employment of more than 2 years and less than 5 years4 weeks’ notice for over 5 years of employment
Severance Pay
The severance payment includes all the salaries and benefits due at the last day of employment. If the employee has been employed for at least 2 years, they are entitled to receive “retrenchment benefits”.
The amount given to the employee depends on what is agreed upon in the employment contract or collective agreement when applicable.
In general, retrenchment benefits are usually between 2 weeks to one month for every year the employee has served at the company.
Probation Period
Probation period is optional but common practice is 3-6 months.
Working Hours
If an employee works a 5-day work week, a workday is up to 9 hours a day or 44 hours a week.
If an employee works a 6-day work week the workday is up to 8 hours.
Overtime
For employees who are covered by the Employment Act, an employee must be paid 150% of the hourly basic pay of rate for any overtime hours.
Only the following employees are entitled to overtime:
A non-workman earning up to $2,600.
A workman earning up to $4,500.
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