Managing & Steering HR through Economic Turbulence

For all employees: the employment contract is the most important document. You can draft it on your own, however, it will be better if you seek guidance from a lawyer or HR consultant. Therefore, Talent Spot listed some of the key points to be included in the contact below:

Reporting Employee Earnings

For all employees: As an employer you are required to prepare tax forms for all your employees (who are employed in Singapore) to report their remuneration every year under the Income Tax Act.

Tax Issues for Foreign Employees

For foreign employees ceasing employment with you, leaving on an overseas posting, or leaving Singapore for any period exceeding three months: Tax Clearance is required for the above-mentioned categories of employees, to ensure that all taxes have been paid by him/her. As an employer, you must notify the tax authority (IRAS) and withhold all payments due to your foreign employee from the day he/she notifies you of his/her intention to cease employment or when you decide to terminate the employment or post the employee to an overseas location. Once the IRAS does an assessment and issues a tax clearance certificate, confirming that all taxes have been paid, you can release the payment due to your employee.

Hiring students

For students who are Singapore citizens/Singapore PRs: Students who are citizens or SPRs can be hired on a full-time and part-time basis, without any restrictions. Students are entitled to CPF contributions unless exempted. If you wish to take on students for an internship there is no need to make CPF contributions, as they are only undergoing training in your organization as part of their curriculum. The common practice is to pay interns only a monthly allowance.

For students who are foreigners: Foreign students are not allowed to work in Singapore during term time or vacation time unless they are granted Work Pass exemption under the Employment of Foreign Manpower (Work Pass Exemptions) Notification. If you wish to take on foreign students as interns or part of an industrial attachment program, you must apply for a Training Employment Pass or Training Work Permit on their behalf. No foreign worker levy payment needs to be made since they are only undergoing training in your organization as part of their curriculum. The common practice is to pay interns only a monthly allowance.

Hiring part-time employees and contractual staff

Part-time employees are defined as those who are required to work for less than 35 hours a week. Contract workers refer to those on fixed-term employment contracts as well as those on casual/on-call employment who are employed on an ad-hoc basis, as and when the company requires additional manpower. The contract lasts only for a specified time frame and ends when the specified task/job is completed.

Unlike most other countries, under Singapore's employment laws, part-timers and contract workers enjoy almost the same protection as permanent full-time employees. There is however a certain amount of flexibility for both employers and employees, including the pro-rating of employment benefits, encashment of annual leave, and provision of rest days. Please be advised that as a common practice in Singapore, part-time and contract employees are usually not entitled to certain privileges like bonuses, medical insurance, and other perks that full-time employees normally tend to enjoy.