Hiring of Employees in Singapore
Hiring Employees in Singapore
When Would I Need To Start Hiring?
Many entrepreneurs/founders start off with minimum staff strength, doing as much of the work as they can by themselves. This usually helps to keep fixed costs as low as possible.
If they need extra hands, it’s usually on a short-term or project basis, so that the freelance/contract costs are contained, predictable and recoverable.
There are various options available to you, depending on your present and future needs. You can outsource staff on a project basis, hire project or contract workers, or hire part-time or full-time permanent staff.
Hiring & Recruiting – What Do I Need To Know?Hiring permanent staff is a serious commitment and usually signifies taking the next leap in your business. Revenues should ideally be at a more stable level, cash flow should preferably be positive as your costs will increase exponentially.
You will need to cover fixed costs like office rent, salaries, equipment etc. on a monthly basis, regardless of whether there is any revenue coming in. So be sure to work out your financial plan incorporating staff costs at least 12 months in advance and use it to set monthly revenue targets.
Many entrepreneurs/founders start off with minimum staff strength, doing as much of the work as they can by themselves. This usually helps to keep fixed costs as low as possible.
If they need extra hands, it’s usually on a short-term or project basis, so that the freelance/contract costs are contained, predictable and recoverable.
There are various options available to you, depending on your present and future needs. You can outsource staff on a project basis, hire project or contract workers, or hire part-time or full-time permanent staff.
Hiring & Recruiting – What Do I Need To Know?Hiring permanent staff is a serious commitment and usually signifies taking the next leap in your business. Revenues should ideally be at a more stable level, cash flow should preferably be positive as your costs will increase exponentially.
You will need to cover fixed costs like office rent, salaries, equipment etc. on a monthly basis, regardless of whether there is any revenue coming in. So be sure to work out your financial plan incorporating staff costs at least 12 months in advance and use it to set monthly revenue targets.
Wages & Recruitment In Singapore
Recruiting people requires you to be clear about your requirements, and understand the best ways to go about hiring the best talent you can afford.
Recruiting people requires you to be clear about your requirements, and understand the best ways to go about hiring the best talent you can afford.
- Understand The Singapore Labour Market
Before you recruit staff, it would be wise to gain a good understanding of the labour market. Research the market rate for the position(s) you wish to fill, how much salary you can afford to pay, and the benefits you should give to attract talent. - Salary & Benefits
Benchmark your salaries against the National Wage Guidelines and offer your potential employees the right amount of annual, maternity and childcare leave as required by law. - Fair Recruitment Practice & Your Job Ad
Your job ad is a critical component of your recruitment process. Craft an advertisement that reflects your company culture and states clearly the job requirements and scope of work. This will ensure you attract the right kind of applicants. Practice non-discrimination by not stating age, gender, race, marital status or religion as requirements. - Recruitment Channels
You can tap into Government-supported channels such as online job portals and job fairs from the Singapore Workforce Development Authority (WDA) and NTUC. You can also look into commercial channels like the local newspapers and online job websites.
Employment Passes & Work Permits For Foreigners
If you intend to hire foreigners (non-Singapore Citizens or non-Permanent Residents), you will need to apply for work passes for them to work legally in Singapore. The passes you need to apply for depend primarily on the salary they will be paid
Employment Pass
Basic salary must be S$2,800 and above.
No quota is imposed.
Generally used for professionals/executives and foreign entrepreneurs who wish to start up a business in Singapore.
S Pass
Basic salary must be S$2,000 and above.
Quota of 25% of company workforce (i.e. 1 out of 4).
Generally used for mid-level skilled foreign workers like skilled technicians.
Work Permits (WP)
Salary is not a criterion.
Quotas vary according to the sector you are in.
Generally used for unskilled or semi-skilled foreign workers in sectors like construction, manufacturing or hospitality, and foreign trainees on training for less than 6 months.
If you intend to hire foreigners (non-Singapore Citizens or non-Permanent Residents), you will need to apply for work passes for them to work legally in Singapore. The passes you need to apply for depend primarily on the salary they will be paid
Employment Pass
Basic salary must be S$2,800 and above.
No quota is imposed.
Generally used for professionals/executives and foreign entrepreneurs who wish to start up a business in Singapore.
S Pass
Basic salary must be S$2,000 and above.
Quota of 25% of company workforce (i.e. 1 out of 4).
Generally used for mid-level skilled foreign workers like skilled technicians.
Work Permits (WP)
Salary is not a criterion.
Quotas vary according to the sector you are in.
Generally used for unskilled or semi-skilled foreign workers in sectors like construction, manufacturing or hospitality, and foreign trainees on training for less than 6 months.
Legal Obligations of Employers
Legal requirements you must comply with, such as employment contracts, Central Provident Fund (CPF) contributions for local employees, taxes and levies for foreign employees, and workplace safety and health.
Legal requirements you must comply with, such as employment contracts, Central Provident Fund (CPF) contributions for local employees, taxes and levies for foreign employees, and workplace safety and health.
- Prepare Your Employment Contract
You need to prepare an employment contract for every employee you hire. Make sure you include standard terms like job title, work scope, salary, bonus, working hours, benefits, code of conduct and termination etc. Refer to a sample employment contract to help you get started. - CPF Contributions
All employers are automatically registered with the CPF Board when they make their first CPF contribution for the first employee. After the first contribution, you can add new employees and file your CPF contributions online. - Comply With Labour Laws & Regulations
Learn about the various labour laws like the Employment Act, Workmen’s Compensation Act, Statutory Maternity Leave, and Employment of Foreign Manpower Act. For instance, the Employment Act states clearly the maximum hours of work and when the employer has to pay overtime. - Taxes, Levies & Contributions
You will need to pay various levies like the Skills Development Levy and Foreign Workers Levy for Work Permit or S pass holders. You will also need to prepare the relevant employee tax forms (e.g. IR8A) during tax time. - Workplace Safety & Health
You need to ensure your workplace is a safe place for your employees. Be sure to comply with the factories, air-con and window safety and fire safety requirements.
