Singapore Government Planning To Remove Salary Cap In Employment Act

Singapore Government Planning To Remove Salary Cap In Employment Act

Singapore’s Employment Act is set to undergo a major change, as proposals were introduced on Tuesday to expand it to cover higher-paid professionals, managers and executives (PMEs).

The move will bring 430,000 more PMEs under the Act which currently covers blue collar workers, including technicians, clerical staff; and PMEs earning below S$4,500 a month.

The amendment will ensure that these PMEs will be ensured basic employee benefits covering mandated leave including maternity and childcare as well as safeguards for wrongful dismissal and even working hours, including overtime pay.

The proposed amendments also include:

  • Removal of the S$4,500 salary cap will allow the higher income PMEs to be entitled to employment terms such as minimum days of annual leave, paid sick leave, hospitalisation leave, and compensation for wrongful dismissal. Public servants, domestic workers and seafarers are excepted from the Act, as they are covered under other legislations.
  • Revision of salary cap for overtime pay for non-workmen from S$2,250 to S$2,600, which will benefit an additional 100,000 workers.
  • Allowing any medical practitioner to certify an employee’s entitlement to paid medical leave.
  • Shifting the hearing for wrongful dismissal claims from the Ministry of Manpower to the Employment Claims Tribunals (ECT).

According to Mr Kurt Wee, president of the Association of Small and Medium Enterprises, the proposed changes “are unlikely to have a significant impact on business costs,” but will serve to “sharpen business owners’ awareness of good employment practices”.

[Sources 1, 2]

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