Employment Act Singapore 2026: Complete Guide for Employers

The Employment Act is the cornerstone of employment law in Singapore. As an employer, understanding your obligations under this Act is not optional — breaches can result in fines, prosecution, and significant reputational damage. Since the 2019 amendments expanded coverage to include all employees regardless of salary level, every employer in Singapore needs to be familiar with the Act's key provisions.

This guide covers the essential provisions that affect your day-to-day operations as a Singapore employer.

Who Is Covered

Broad Coverage (All Employees)

Since 1 April 2019, the Employment Act covers all employees under a contract of service in Singapore, regardless of salary level. Core provisions that apply to all employees include:

• Timely payment of salary
• Public holiday entitlements (11 gazetted holidays)
• Sick leave
• Annual leave
• Termination and notice requirements
• Protection against wrongful dismissal
• Itemised pay slips
• Key Employment Terms (KETs) in writing

Part IV Coverage (Overtime and Rest Days)

Part IV provisions — which govern overtime pay, rest days, and hours of work — apply only to:

• Workmen (manual labour) earning up to S$4,500 per month basic salary
• Non-workmen earning up to S$2,600 per month basic salary

Managers and executives earning above these thresholds are exempt from Part IV but still covered by all other provisions.

Who Is NOT Covered

• Seafarers — Covered by the Merchant Shipping Act
• Domestic workers — Covered by the Employment of Foreign Manpower Act
• Public servants — Covered by separate public service regulations
• Self-employed and freelancers — Not in an employer-employee relationship

Key Employer Obligations

1. Written Key Employment Terms (KETs)

You must provide written key employment terms to every employee within 14 days of starting work. KETs must include:

• Job title and description
• Start date and duration (if fixed-term)
• Working hours and rest days
• Salary details (basic pay, allowances, deductions, overtime rates)
• Leave entitlements
• Notice period for termination
• Other benefits (medical, insurance, etc.)

Penalty for non-compliance: Up to S$5,000 per offence, or S$10,000 for repeat offenders.

2. Itemised Pay Slips

You must provide itemised pay slips to every employee at least once per salary period (typically monthly). Pay slips must include:

• Full name of employer
• Full name of employee
• Date of payment
• Basic salary for the period
• Start and end dates of the salary period
• Allowances and deductions (itemised)
• Overtime hours, overtime pay rate, and overtime pay
• Net salary paid

Pay slips must be provided within 3 days of salary payment (5 days for electronic pay slips).

Penalty for non-compliance: Up to S$1,000 per offence, or S$2,000 for repeat offenders.

3. Salary Payment

Salaries must be paid:

• Within 7 days after the end of each salary period (monthly, for most employees)
• Overtime pay: Within 14 days after the end of the salary period
• On termination: All salary owed within 3 days of termination (if employer terminates) or on the last day of the notice period (if employee resigns)

Salary must be paid in legal tender or by bank transfer to the employee's account.

4. Public Holidays

All employees are entitled to 11 gazetted public holidays per year:

1. New Year's Day
2. Chinese New Year (2 days)
3. Good Friday
4. Hari Raya Puasa
5. Labour Day
6. Vesak Day
7. Hari Raya Haji
8. National Day
9. Deepavali
10. Christmas Day

If an employee is required to work on a public holiday, they are entitled to:

• An extra day's salary at the basic rate (in addition to the holiday pay), OR
• A replacement holiday

5. Annual Leave

Minimum annual leave entitlements under the Employment Act:

Leave is pro-rated for employees who have not completed a full year. Annual leave must be consumed within 12 months — there is no statutory requirement to carry forward, though many employers allow it.

6. Sick Leave

Employees are entitled to paid sick leave if they have served for at least 3 months and are certified by a medical practitioner:

• Outpatient sick leave: Up to 14 days per year
• Hospitalisation leave: Up to 60 days per year (inclusive of the 14 outpatient days)

The employer pays sick leave at the employee's gross rate of pay.

7. Maternity and Paternity Leave

Maternity leave (under the Child Development Co-Savings Act):

• 16 weeks of paid maternity leave for eligible employees
• First 8 weeks: employer-funded
• Last 8 weeks: government-funded (capped at S$10,000 per 4-week period)
• Eligibility: child must be a Singapore citizen; mother must have been employed for at least 3 months before delivery

Paternity leave (under the CDCA):

• 2 weeks of government-paid paternity leave
• Eligibility: child must be a Singapore citizen; father must have been employed for at least 3 months before the child's birth

Shared parental leave: Parents can share up to 4 weeks of the mother's maternity leave with the father.

8. Hours of Work (Part IV Employees Only)

For employees covered by Part IV:

• Maximum 8 hours of work per day, or 44 hours per week
• Employees must not work more than 6 consecutive hours without a break
• Breaks of at least 45 minutes for every 6 hours of continuous work
• Maximum 12 hours of work in any day (including overtime)
• At least 1 rest day per week (unpaid for daily-rated or hourly-rated employees)

9. Overtime (Part IV Employees Only)

• Overtime rate: at least 1.5 times the basic hourly rate
• Overtime cap: 72 hours per month
• Employers must obtain the employee's agreement for overtime
• Overtime must be paid within 14 days of the salary period's end

10. Termination and Notice

Either party can terminate employment by giving notice as specified in the contract. If the contract does not specify:

Salary in lieu of notice: Either party can pay salary in lieu of notice instead of working the notice period.

Summary dismissal: An employer can dismiss without notice for serious misconduct (theft, dishonesty, gross insubordination), but must conduct a fair inquiry first.

Wrongful dismissal: Employees who believe they have been wrongfully dismissed (including dismissal on discriminatory grounds, for exercising a statutory right, or without just cause) can file a claim with the Tripartite Alliance for Dispute Management (TADM).

Employment Act and Data Protection

As an employer, you handle significant amounts of employee personal data: names, NRIC numbers, addresses, bank account details, salary information, medical records, and performance evaluations. This data is subject to the PDPA.

Key intersections:

• NRIC collection: The PDPC restricts NRIC collection. Do not use NRIC numbers for routine purposes — use employee IDs instead.
• Payroll data: Employee salary and bank details are personal data under the PDPA. Protect them with appropriate security measures.
• Medical records: Sick leave certificates contain health information. Store them securely and limit access.
• Exit procedures: When an employee leaves, ensure their personal data is handled according to your data retention policy.
• Consent: While many employment-related data uses fall under deemed consent by contractual necessity, collecting data beyond what is needed for the employment relationship (e.g., for marketing) requires separate consent.

Common Employer Mistakes

1. Not Providing Written KETs

Many SMEs still rely on verbal agreements. This is a compliance risk — MOM inspectors actively check for written KETs during audits.

2. Incorrect Overtime Calculations

Overtime must be calculated on the basic rate of pay, not including allowances. A common error is using the gross salary rate instead of the basic rate.

3. Deducting Unauthorised Amounts

Employers can only make authorised deductions from salary (CPF contributions, income tax via IR8A, court orders, and employee-authorised deductions). Deducting for damages, shortages, or fines without proper authorisation is a breach.

4. Misclassifying Employees as Contractors

Labelling a worker as an "independent contractor" when the relationship is actually one of employment does not remove your obligations under the Employment Act. MOM looks at the substance of the relationship, not the label.

5. Failing to Pay on Time

Late salary payment is one of the most common Employment Act complaints to MOM. Ensure your payroll processes are set up to pay within 7 days of the salary period end.

CPF Obligations

While not part of the Employment Act itself, CPF contributions are a critical employer obligation. As an employer, you must:

• Contribute to employees' CPF accounts at the prescribed rates
• Pay both the employer and employee portions (deducting the employee portion from salary)
• Submit contributions by the 14th of the following month
• Report accurate salary figures

CPF contribution rates vary by employee age and residency status. Consult the CPF Board website for current rates.

Managing employee data responsibly is part of being a good employer. ComplyHQ helps you stay on top of PDPA compliance for your employee data — from proper consent collection to secure data handling. Start a free assessment

Government Resources

• Ministry of Manpower — Employment Act — Official guide
• TADM — Tripartite Alliance for Dispute Management
• CPF Board — CPF contribution rates and obligations
• Employment Act (Full Text) — Singapore Statutes Online

Related Articles

• PDPA Compliance Checklist for Singapore SMEs (2026 Edition) — Protect your employee data
• NRIC Collection Rules in Singapore — NRIC restrictions for employee records
• Workplace Safety and Health Act: What Every Singapore SME Must Know — Workplace safety compliance
• PSG Grant for Singapore SMEs — Government funding for business solutions
• How to Appoint a Data Protection Officer in Singapore — Manage employee data compliance