Payroll Management: Itemised payslips and written Key Employment Terms (KET)s now mandatory when hiring in Singapore with effect from 1 April 2016.
Payroll Management rules has been amended by Singapore’s Ministry of Manpower in order to protect the rights of both employers and employees.
Key changes include the requirement for employers to provide itemised payslips in payroll of all employees covered under the employment act (EA) together with their salary payments.
MOM has announced that they intend to effect these new requirements on April 1, 2016.
At the same time, employers will be required by MOM to provide written KETs to all staff covered under the EA with continuous employment of at least 14 days.
“Taken together, itemised payslips and KETs provide greater clarity and assurance to employees about their regular salary components as well as their main employment terms and benefits,” MOM stated.
Employers however, will have the flexibility to decide the form in which they would issue the payslips (hard copy or soft copy) as long as the required breakdown is reflected. They are also able to consolidate the payslips if payments are made more than once a month.
Similarly, employers will have flexibility in how KETs are provided as long as the required items are clearly accessible.
“The proposed amendments will raise employment standards and facilitate dispute resolution at the workplace,” said Lim Swee Say, Minister for Manpower, at the second reading of the employment (amendment) bill in parliament.
“They will also provide employers the flexibility to manage these changes in a practical manner. Taken as a whole, they will strengthen our efforts to institute good employment norms and develop progressive workplaces for our people.”
In line with the new changes, the penalty framework will also be changed to treat less severe breaches under the EA as civil breaches. Currently, all breaches under the EA are considered criminal breaches.
The breaches will include the failure to provide itemised payslips, the failure to provide written KETs, the failure to keep detailed employment records as well as the provision of inaccurate information without fraudulent intent to the Commissioner for Labour or inspecting officers.
Human Resources spoke with Emmanuel White, regional director, Singapore, Hudson to find out more about how recruiters in the country are viewing these changes.
“These are basic requirements to any employment relations and the KET will certainly help clarify the job description for the employee,” White observed.
“It helps outline expectations between employer and employees and will minimise potential disputes. We see this as a natural improvement to the EA and is a good resolution for all involved. I don’t foresee any difficulties arising with this change.”
MOM added that since April 2014, it has been working with IDA and SPRING as well as the tripartite partners to provide employers with payroll management tools to issue payslips and KETs in writing.
“Employers can continue to tap on the assistance package, including blank payslips and KETs that can be filled in by hand, free software, one-to-one hands-on assistance for SMEs, and payroll management funding,” it stated.