11 April, 2019
A number of amendments to the Employment Act of Singapore have come into effect from 1 April 2019. One of the key changes brought about by such amendments is that all employees covered under the Employment Act (i.e. all employees except seafarers, public servants and domestic workers) are now able to file claims against their employers for a wrongful dismissal.
If an employee wishes to make a wrongful dismissal claim, the employee must first file a mediation request with the Tripartite Alliance for Dispute Management (TADM). If the matter is not resolved during the mediation session, the claim will then be heard by the Employment Claims Tribunal (ECT).
In the event that an employer is found to have wrongfully dismissed the employee, the ECT can:
- order the employer to pay compensation to the employee; or
- order the employer to reinstate the employee's employment and to pay an amount equivalent to the employee's wages he would have earned if not wrongfully dismissed by the employer.
In line with the above, the Ministry of Manpower (MOM), the National Trades Union Congress (NTUC) and the Singapore National Employers Federation (SNEF) have jointly issued the Tripartite Guidelines on Wrongful Dismissal on 1 April 2019 (the Guidelines), which provides illustrations and guidance on what constitutes wrongful dismissal.
We have set out below some key aspects of the Guidelines.
- Dismissal without notice – Employers may only dismiss their employees without notice by reason of misconduct. Due inquiry must be made before such dismissal. Misconduct includes but is not limited to theft, dishonest or disorderly conduct at work, insubordination, or bringing the company into disrepute. In this instance, the employer has the burden of proof to show that the dismissal was not wrongful.
- Right to contractual termination – Dismissal with notice are presumed to be legitimate and not wrongful. This would mean that where an employer terminates an employee in accordance with his or her employment agreement by provision of the requisite notice of termination, the dismissal is, at first instance, not wrongful.
- Dismissal with notice for poor performance – Where such reason is cited, the employer bears the burden of proving this ground for dismissal. If the employer is unable to do so, the dismissal is considered wrongful. For example, documented proof of the employee's poor performance and consistent poor performance reviews could be helpful in substantiating the grounds for such dismissal.
- Dismissal with notice for redundancy – Dismissal with notice due to redundancy is not wrongful.
- Examples of Wrongful dismissal (where notice was given) – It is wrongful to dismiss an employee (regardless of whether notice of termination was given):
(a) for discriminatory reasons, such as age, race, gender, religion, marital status and family responsibility or disability;
(b) by depriving the employee of benefits / entitlements which the employee would otherwise have (for example, maternity benefits); and
(c) for the purposes of punishing an employee for exercising his or her employment right is also wrongful.
These Guidelines are intended as a helpful reference in order to minimise disputes over dismissal matters. However, it is important to bear in mind that every termination are different in circumstances and as these Guidelines are not exhaustive, it would be prudent for HR and employers to err on the side of caution in every termination of employment.
Employers should review their dismissal procedures and ensure that sufficient checks and processes are in place to avoid a wrongful termination. This may include setting clear and transparent termination policies, as well as establishing clear procedures for how cases of poor performance and misconduct will be dealt with internally.
For further information, please contact:
Thomas Choo, Clyde & Co
thomas.choo@clydeco.com
