Singapore: Compliance check - contract workers

The Singapore Ministry of Manpower has recently issued new guidelines in relation to contract workers as part of the drive to protect such workers from abuse. With a growing emphasis on such protection in Asia, employers should ensure that they are compliant with current laws and regulations when using fixed-term employment arrangements.

Protections for contract workers

As employers are no doubt aware, many jurisdictions in Asia have robust rules in place to prevent the abuse of fixed- term employment arrangements. In Taiwan and Indonesia, for example, fixed-term employment arrangements can only be used in certain limited circumstances; in China and South Korea, strict rules are in place relating to how long fixed- term employment contracts can be entered into and how they may be renewed or extended.

In Singapore, the increasingly common use of fixed-term employment arrangements has also caught the attention of the Ministry of Manpower, which has recently issued guidelines aimed at ensuring that contract workers are not deprived of leave benefits by employers who employ such workers on short-term contracts and then periodically renew such contracts to avoid leave benefits accruing. The spotlight on this issue in Asia is a signal for employers to look again at their current employment arrangements to ensure that they have not fallen foul of any laws or regulations.

Compliance

Employers should consider their current employment arrangements to assess:

1. how many workers are on fixed-term employment contracts;
2. how long such workers have been engaged on fixed-term contracts;
3. whether any of these workers have been engaged on successive fixed-term contracts;
4. the reasons for or circumstances behind these arrangements;
5. how the length of service for such workers are calculated;
6. how benefits accrue for such workers; and
7. how terminations of these fixed-term contracts are carried out.

Herbert Smith Freehills can assist you with achieving compliance. To discuss how, please contact Fatim Jumabhoy at [email protected].