4 October, 2015
On 17 August 2015, Parliament passed the amendments to the Employment Act (“the Act”) at the Second Reading of the Employment (Amendment) Bill (“the Bill").
These amendments include requiring employers to make and keep records of employees, and to give a written record of key employment terms and pay slips to employees.
On 21 August 2015, the Employment (Amendment) Act 2015 (“the Amendment Act”) was published in the Government
Gazette. The Amendment Act has come into operation on 22 August 2015 except for the provisions relating to: (a) the
administrative penalty framework; and (b) employers’ obligations vis-à-vis makingand keeping of employee records, as well as providing key employment terms and itemised payslips. These provisions are expected to be effective from 1 April 2016.
This brief update highlights key aspects of the various amendments to the Act, as indicated by the Minister for Manpower (“the Minister”) during the Second Reading
of the Bill.
1.Key employment terms and pay slips
The new requirements for itemised payslips and key employment terms for employees covered under the Act are expected to be effective from 1 April 2016. As the Minister observed at the Second Reading, the aim of these requirements is, on the one hand, to “allow employees to better understand their regular salary components, as well as employment terms and benefits” and, on the other hand, to “help the employers to prevent misunderstandings and minimise disputes with their employees”.
However, the Ministry of Manpower (“the Ministry”) will give a one-year grace period in its enforcement. From April 2016 to end March 2017, the Ministry will take “a light touch enforcement approach” as it will focus on educating employers
on how to comply with the new payslip requirements and key employment terms.
It is noted that employers in small businesses would be allowed to set out the broad job scope in the key employment terms at the start of employment. Employers may issue new key employment terms during the course of employment, if necessary, to address any key changes to the job scope. Such flexibility would address concerns that employers in small businesses may need their employees to take on other work due to exigencies.
It is also observed that common key employment terms can be set out in the company’s employee handbook or website, as long as they are easily accessible to employees. Employers should be aware though that the new s 95A(4) of the Act
does not limit any other way of giving to the employee the written key employment terms.
In addition, key employment terms apply only to employees who work for a continuous period of at least 14 days. Hence, casual workers who work only for a few days occasionally need not be given key employment terms.
2. Administrative penalties for civil contraventions
At the Second Reading, the Minister informed that the new administrative penalty framework, which will also be expected to come into effect from 1 April 2016, is meant to allow the Ministry “to treat less severe breaches as non-criminal
infringements which attract an administrative penalty instead”.
Four breaches will be covered under this framework:
- Failing to issue itemised payslips;
- Failing to issue written key employment terms;
- Failing to maintain detailed employment records; and
- Providing inaccurate information to the Commissioner for Labour or inspecting officers without the intent to defraud and mislead.
It is envisaged that depending on the type of breach, an administrative penalty of between $100 to $200 per employee or occurrence may be imposed. Employers can also be directed to rectify the breaches, failing which non-compliance will become a criminal offence.
3. Public holidays and family-related leave
Pursuant to the latest amendments, employers will either have to pay their employees who are required to work on a public holiday their gross rate of pay for that holiday, or give them a day off in lieu of that holiday. At the Second Reading of the Bill, the Minister clarified that public holidays will include “all non-scheduled public holidays declared by the Government such as the SG50 Public Holiday and polling days”.
Furthermore, employees who are granted voluntary no-pay leave would not be entitled to family-related leave such as maternity leave or childcare leave. These amendments are consistent with the current practice “to encourage employers to grant no pay leave to employees to cater to their family or personal needs”.
Conclusion
The recent amendments to the Act are welcome as they will help raise employment standards as well as minimise misunderstandings and disputes at the workplace. Both employers and employees would now have greater clarity on their respective legal obligations, which would make it easier for them to resolve any disputes arising at the workplace.
