With 2015 drawing to a close, HRD examines the government’s proposed employment law changes which will come into effect in the coming year
Increased CPF contributions
Taking effect from 1 January 2016, employers will be expected to make greater Central Provident Fund (CPF) contributions for older workers.
The changes affect employee contributions for employees aged between 50 and 65 years who are earning monthly wages of S$750 or more.
The adjusted CPF contributions for employers of mature workers are listed in the table below:
|Employee age (years)||Employer contribution (percentage of wage)|
|55 and below||17%|
|Above 55 to 60||13%|
|Above 60 to 65||9%|
The CPF salary ceiling will be raised from S$5,000 to S$6,000 for all age groups.
The contribution cap for Singapore citizens and permanent residents will be increased to S$15,300 while the contribution cap for foreigners will be increased to S$35,700.
To help certain employers cover these additional costs, the government has said it will offer additional temporary employment credit (TEC) in 2016. Eligibility will be assessed by the CPF Board.
Firms which are approved will receive TEC twice a year in April and October. This will be equal to one per cent of employee wages up to the CPF salary ceiling of S$6,000.
Payslips & key employment terms
From 1 April 2016, all workers covered under the Employment Act will have to receive both itemised payslips and a list of key employment terms (KETs).
The payslips have to be issued once a month and must contain the following information:
- Full name of employer
- Full name of employee
- Date of payment
- Basic salary for each salary period
- Start and end date of each salary period
- Allowances paid (fixed and ad-hoc)
- Additional payments (bonuses, rest day pay, public holiday pay)
- Deductions made (fixed and ad-hoc)
- Overtime hours worked
- Overtime pay for each overtime payment period
- Start and end date of each overtime payment period
- Net salary paid for the month
HR will also have to supply all employees who are working for the company for a minimum of 14 days with a list of KETs. These can be provided in a staff handbook or over the firm’s intranet.
The penalty framework for breaching the Employment Act has also been amended. Those failing to supply itemised payslips or KETs or failing to keep complete employment records will be liable to a fine that ranges from S$100 to S$200 per employee per occurrence.
Initially, these breaches will be looked into as civil offenses. However those who fail to comply with the financial penalties will still receive a criminal record.
Employers will have one year grace period effective from 1 April 2016 in which the Ministry of Manpower will issue lighter penalties. Instead, MOM will work with employers to make sure everyone complies with these new regulations.
Increased work compensation limits
From 1 January 2016, the government will introduce increased work compensation limits for injury and death. These changes have been made under the Work Injury Compensation Act (WICA).
Compensation limits for permanent incapacitation will increase from between S$73,000 and S$218,000 to between S$88,000 and S$262,000.
In case of death, these limits will increase from between S$57,000 and S$170,000 to between S$69,000 and S$204,000.
The maximum amount of medical expenses claimable will also go up from S$30,000 to S$36,000.
MOM will also expand the types of expenses claimable under WICA. This additional compensation is meant to bring employees back to work quicker and can include hiring an occupational therapist to assess the workplace prior to an employee returning or appointing a case manager to coordinate staff, employers and healthcare professionals.
Employer CPF contribution increases on the horizon
New Employment Act amendments become law
MOM announces new changes to work injury compensation