In Short
The Situation: The Singapore government recently has announced a raft of changes that will impact employers in 2023 and beyond. These include introducing a new eligibility framework for employment passes for foreign professionals and expanding various rights and protections of Singapore employees.
The Result: These changes will affect the hiring and renewal of employment passes for foreign professionals and may subject employers to additional civil penalties and claims for compensation and remedial action from employees. Employer costs will also rise.
Looking Ahead: Employers should regularly review their policies and hiring procedures and criteria to ensure that they are compliant with the changing regulatory landscape and minimise the risk of potential liability for the organisation and its management.
The Singapore government's new and proposed changes to the regulatory framework for employment in Singapore include introducing a new points-based eligibility framework for employment passes for foreign professionals, enhancing guidelines for fair employment practices, proposed new workplace discrimination legislation, increasing parental and childcare leave and raising the Central Provident Fund ("CPF") contribution ceilings.
Employment Pass Eligibility Criteria
Starting 1 September 2023, employment pass ("EP") applications for foreign professionals will follow a new two-stage eligibility framework. An EP applicant will first need to meet an increased qualifying salary dependent on age and industry. The applicant must then pass a points-based Complementary Assessment Framework (or COMPASS) test that will take into account salary, qualifications, diversity and support for local professionals. Bonus points will be awarded for occupations recognised as having skills shortages or that are part of a government strategic priority.
Enhanced Guidelines on Exercising Sensitivity for a Harmonious Workplace
The Tripartite Guidelines on Fair Employment Practices ("Guidelines") issued by the Ministry of Manpower ("MOM") and its tripartite partners set out fair employment practice standards to help prevent discrimination and encourage employers to adopt progressive HR practices.
In February 2023, the Guidelines were expanded to require employers to demonstrate and communicate the importance of an inclusive and harmonious workplace, including to:
- Assess employees for performance, promotion and related areas based only on work-related requirements; and
- Not require or pressure employees to participate in non-work-related activities.
Currently, employers who fail to observe the Guidelines will face scrutiny from MOM and may have their work pass privileges suspended.
Proposed Workplace Discrimination Laws
On 13 February 2023, the Tripartite Committee on Workplace Fairness ("TWCF"), which was set up by MOM to review the regulatory framework for workplace fairness in Singapore, proposed new legislation expected in late 2024 prohibiting common forms of workplace discrimination and strengthening protection and redress for victims.
What Types of Discrimination Would Be Prohibited Under the Proposed Legislation? The proposed legislation would prohibit discrimination in respect of age, nationality, sex, marital status, pregnancy status, caregiving responsibilities, race, religion, language, disability and mental health conditions through all stages of employment, from recruitment to termination.
What Would Be the Potential Remedies and Penalties? Parties would be encouraged to explore non-monetary remedies during compulsory mediation, such as reinstatement of an employment offer or an apology letter from the employer.
If the claim is escalated to the Employment Claims Tribunal ("ECT"), the ECT would be empowered to order the employer to pay compensation to the victim up to a fixed amount depending on the nature of the claim.
The government may concurrently conduct an investigation into any suspected breach of workplace fairness legislation and take enforcement action ranging from corrective orders to financial penalties. Notably, under the proposed legislation, enforcement actions may be levied against both the company and the persons responsible for the discriminatory act.
These proposed penalties and remedies are significant because under the Guidelines currently, as noted above, the only available enforcement lever is the curtailment of work pass privileges.
Are Any Employer Safeguards Proposed? The ECT would be empowered to strike out frivolous or vexatious claims or award costs to be paid by the unsuccessful claimant.
Does the Proposed Legislation Contain Any Exemptions? A small number of exemptions are proposed:
- A protected characteristic may be taken into account in an employment decision if it is a genuine and reasonable job requirement;
- Employers would be permitted to favour those with disabilities and seniors (over 55 years) over other groups in hiring decisions, even if another candidate may be equally or more qualified; and
- Small firms (with fewer than 25 employees) would be exempt for the first five years.
When Would the Proposed Legislation Take Effect? The TWCF aims to table legislation in Parliament by the second half of 2024.
Increased Paternity and Infant Care Leave and CPF Contribution Ceiling
On 14 February 2023, the government announced that paternity leave and infant care leave will be increased starting in January 2024. In addition, the Central Provident Fund monthly salary contribution ceiling will be raised in stages starting on 1 September 2023.
Two Key Takeaways
- Employers should review their employment policies and procedures to ensure they are compliant with the changing regulatory landscape in order to minimise the risk of potential liability for the company and its officers. This review should include policies and procedures impacting all stages of employment, from job advertisements to employee performance evaluations and beyond.
- Employers should ensure that employees involved in the hiring, compensation, grievance handling or other employee-facing processes are trained on fair and legally compliant employment practices, including conducting non-discriminatory job interviews, and are guided by a well-defined fair recruitment and retention philosophy when evaluating employees.
