| Key Takeaways |
|---|
| 1 Hiring talent is just the first step; retaining them requires a compliant HR structure that adheres to Singapore's employment regulations. |
| 2 EOR (Employer of Record) is ideal for companies without a local entity, enabling fast, compliant hiring in Singapore without establishing a legal presence. |
| 3 PEO (Professional Employer Organization) suits companies with a local office that need flexible, outsourced HR support and payroll management. |
| 4 Compliance with CPF, work passes, payroll, and local laws is critical to avoid fines, legal issues, and reputational damage in Singapore's regulated market. |
| 5 Choosing the right model depends on your business stage, scale, and long-term growth goals in the Singapore market. |
Discover the global hiring and employment landscape in Singapore – a thriving business hub favored by global companies for its strategic location, robust infrastructure, and pro-business policies. With a stable political climate and skilled workforce, Singapore provides an ideal environment for business growth.
Personal Income Tax
Non-residents are taxed either at a flat rate of 15% or at the resident rate, whichever yields a higher tax. The resident rate that applies to Singapore tax residents is as follows:
| Taxable Income (SGD) | Progressive Tax Rate (%) |
|---|---|
| Up to 20,000 | - |
| 20,001–30,000 | 2 |
| 30,001–40,000 | 3.5 |
| 40,001–80,000 | 7 |
| 80,001–120,000 | 11.5 |
| 120,001–160,000 | 15 |
| 160,001–200,000 | 18 |
| 200,001–240,000 | 19 |
| 240,001–280,000 | 19.5 |
| 280,001–320,000 | 20 |
| 320,001–500,000 | 22 |
| 500,001–1,000,000 | 23 |
| Over 1,000,000 | 24 |
Local Taxes
Statutory Contributions
Contributions made for the Central Provident Fund (CPF) are calculated based on the monthly Ordinary Wage of up to SGD 7,400 or Total Annual Salary of up to SGD 102,000.
It is important to note that there will be changes to the Ordinary Wage ceiling for CPF contributions, as follows:
| Date | CPF Ordinary Wage Ceiling | CPF Total Annual Salary Ceiling |
|---|---|---|
| From 1 Jan 2025 to 31 Dec 2025 | SGD 7,400 | SGD 102,000 |
| From 1 Jan 2026 onwards | SGD 8,000 |
Employer Contributions
| Contribution Rate for Locals/PRs | Contribution Rate for Foreigners | Note | |
|---|---|---|---|
| CPF | 17% | - | This rate is only applicable to Singaporeans or PRs up to 55 years of age. Employees earning less than SGD 750 per month and those over 55 years old have a different rate of contribution. |
| Skills Development Levy | 0.25% | 0.25% | The minimum amount payable is SGD 2, and the maximum amount payable is SGD 11.25. |
| Work Injury Compensation Insurance | approx. 0.15% | approx. 0.15% | Actual rate may vary depending on the insurance provider |
Employee Contributions
| Contribution Rate for Locals/PRs | Contribution Rate for Foreigners | Note | |
|---|---|---|---|
| CPF | 20% | - | This rate is only applicable to Singaporeans or PRs up to 55 years of age. Employees earning less than SGD 750 per month and those over 55 years old have a different rate of contribution. |
Payment of Wages
The salary period agreed on between the employee and employer must not exceed one month, and employers are obligated to fulfill salary payments within 7 days after the end of the relevant salary period.
Minimum Wage
Statutory Bonus
Termination
When a party decides to terminate an employment relationship, they must produce a written notice of their intention to terminate. The date on which this notice is given to the other party shall signal the beginning of their notice period.
If the employer seeks to dismiss their employees on the grounds of misconduct, they can do so without notice, provided that they have undergone due inquiry into the allegations warranting their decision. After the inquiry, employers can choose from one of the following outcomes:
| Result of Inquiry | Employer Action |
|---|---|
| No misconduct is found or substantiated | Employee will not be dismissed. If the employee was suspended with reduced pay during the duration of inquiry, the employer shall pay the withheld amount to the employee. |
| Misconduct was found, but employee is retained | Employer may decide to let the employee off with a warning, down-grade the employee or suspend the employee without pay for up to one week. |
| Misconduct was found and employee is dismissed | Produce a written notice of termination. |
Notice Period
The termination of an employment relationship generally requires the terminating party to observe the following notice period or pay the other party in lieu of notice:
| Length of Service | Notice Period |
|---|---|
| Less than 26 weeks | 1 day |
| At least 26 weeks, but less than 2 years | 1 week |
| At least 2 years, but less than 5 years | 2 weeks |
| 5 years or more | 4 weeks |
However, there are certain instances when notice periods or payments in lieu of notice are not required, which include the following:
| Dismissal without notice | Resignation without notice |
|---|---|
| Employee misconduct inconsistent with the fulfilment of the express or implied conditions of the employee's service, after due inquiry | Employee and/or their dependent becomes immediately threatened by danger, either by violence or by disease, that the employee did not undertake to run by their employment contract |
| Employee being absent for more than 2 days without prior approval from employer and either having no justification for their absences or does not attempt to inform the employer of any existing excuses | Employer fails to pay salary in accordance with Part 3 of the Employment Act |
Severance Pay
There are no statutory severance pay requirements in Singapore. However, employers are strongly encouraged to provide retrenchment benefits to employees with at least 2 years of service if they are being retrenched, the amount of which shall be negotiated between the employer and employee.
Probationary Period
The Employment Act does not regulate probationary periods in Singapore. However, it is common for probationary periods last for 3–6 months. Furthermore, regulations surrounding notice period shall apply for employees on probation unless otherwise stated in the employee's contract.
Work Time Rules
Work time rules under the Employment Act only applies to workmen earning a basic monthly salary of up to SGD 4,500 or employees earning a basic monthly salary of up to SGD 2,600.
Standard Working Hours
Employee's normal working hours are subject to a maximum of 8 hours per day or 44 hours per week. However, alternative working arrangements can be made where the employee works longer days or weeks if certain conditions are met.
| Conditions for working longer days | Conditions for working longer weeks |
|---|---|
| Have at least one day of the week with less than 8 hours of work or only up to 5 working days per week | Weekly working hours every alternate week shall be less than 44 hours |
| Working hours are subject to a maximum of 9 hours per day and 44 hours per week | The employee shall not work more than 48 hours in a week and 88 hours in any two consecutive weeks |
Break Period
Employees shall not work more than 6 consecutive hours without rest, and the break period granted to these employees should at least be 45 minutes long. If the nature of the work requires continuous performance, the break period must be provided to employees who perform 8 hours of continuous work.
Overtime
Employers can require their employees to work up to 12 hours per day, provided that the overtime is paid at 150% of their hourly basic rate of pay. Overtime work is subject to a maximum of 72 hours per month.
That being said, employees may be asked to work overtime in excess of these limitations under specific circumstances where their work is deemed essential or urgent. Employers who require their employees to work in excess of 12 hours per day or work overtime in excess of 72 hours per month will need to apply for overtime exemption.
Weekly Rest Days
Employees are entitled to one whole day of unpaid rest per week, which must be on a Sunday or another day as determined by the employer from time to time. If the day of rest is determined by the employer, they must prepare a roster in which the rest days fall before the commencement of every month.
Employees required to work on their rest days shall be paid as follows:
| Working voluntarily | Working at the employer's request | |
|---|---|---|
| Work does not exceed half the employee's normal hours | A sum at the basic rate of pay for half day's work | A sum at the basic rate of pay for a day's work |
| Work more than half, but does not exceed the employee's normal hours | A sum at the basic rate of pay for a day's work | A sum at the basic rate of pay for 2 days' work |
| Work exceeds the employee's normal hours | A sum at the basic rate of pay for a day's work + Overtime pay | A sum at the basic rate of pay for 2 days' work + Overtime pay |
Holiday and Leave Entitlements
Public Holidays
Employees shall be entitled to be paid at their gross rate of pay on public holidays. There are 11 days of public holidays in Singapore for 2025.
| Holiday | Date |
|---|---|
| New Year's Day | January 1 |
| Chinese New Year | January 29–30 |
| Hari Raya Puasa | March 31 |
| Good Friday | April 18 |
| Labor Day | May 1 |
| Vesak Day | May 12 |
| Hari Raya Hajj | June 7 |
| National Day | August 9 |
| Deepavali | October 20 |
| Christmas Day | December 25 |
Employees who are required to work on public holidays shall generally be paid an extra day's salary at the basic rate of pay or, by mutual agreement, a compensatory time off or public holiday in lieu.
| Compensation for working on a public holiday | |
|---|---|
| Public holiday that falls on a working day | An extra day's salary at the basic rate of pay on top of the gross rate of pay for that holiday + any applicable overtime pay for work beyond normal hours |
| Public holiday that falls on a non-working day | An extra day's salary at the basic rate of pay or another day off for the public holiday + any applicable overtime pay for working on a non-working day |
| Public holiday that falls on a rest day | Payment for work done on a rest day + any applicable overtime pay for work beyond normal hours. The next working day shall be converted to a paid holiday. |
Annual Leave
Employees who have completed their first year of service are entitled to 7 days of paid annual leave, which shall increase by an additional day for every completed year of service thereafter, up to a maximum of 14 days. Those who have served the employer for at least 3 consecutive months, but have not completed their first year of service, will have their annual leave prorated according to the number of completed months worked.
Employees covered under Part IV of the Employment Act are allowed to carry over any unused leave to the following year. However, if they are still unused by the end of that year, they may be forfeited.
Sick Leave
Employees who have been employed for at least 3 months are entitled to, after an examination by a medical practitioner, the following paid sick leave:
| Length of Service | Sick Leave without Hospitalization | Sick Leave with Hospitalization* |
|---|---|---|
| At least 3 months | 5 days per year | 15 days per year |
| At least 4 months | 8 days per year | 30 days per year |
| At least 5 months | 11 days per year | 45 days per year |
| At least 6 months | 14 days per year | 60 days per year |
*Includes the days taken for sick leave without hospitalization.
Maternity Leave
Eligible female employees are entitled to maternity leave under the Government-Paid Maternity Leave scheme. Otherwise, they are entitled to maternity leave under the Employment Act.
Maternity Leave under the Government-Paid Maternity Leave
Female employees who have been employed for at least 3 continuous months before childbirth are entitled to 16 weeks of paid maternity leave if their child is a Singapore citizen.
The employee shall give their employer a week's notice before going on maternity leave, and inform them as soon as possible of their delivery, lest their maternity pay be halved.
Maternity Leave Pay under the Government-Paid Maternity Leave shall be distributed as follows:
| Births | Paid by employer | Paid by government |
|---|---|---|
| First and second | First 8 weeks at the employee's gross rate of pay | Last 8 weeks, capped at SGD 10,000 per 4 weeks or a total of SGD 20,000 |
| Subsequent | - | All 16 weeks, capped at SGD 10,000 per 4 weeks or a total of SGD 40,000 |
Maternity Leave under the Employment Act
Female employees who are not eligible for the Government-Paid Maternity Leave Scheme are still entitled to 12 weeks of maternity leave under the Employment Act if they have been employed for at least 3 continuous months before childbirth.
Maternity Leave under the Employment Act can start at any time within 4 weeks before confinement, the first 8 weeks of which shall be paid if the employee has been employed for at least 3 months and has fewer than 2 living children at the time of delivery.
Employees with 2 or more living children at the time of delivery shall have their leave unpaid. However, in the case of multiple births during their first pregnancy, the employee shall retain their right to be paid during the maternity leave period of their next pregnancy.
The employee shall give their employer a week's notice before going on maternity leave, and inform them as soon as possible of their delivery, lest their maternity pay be halved.
Paternity Leave
Employees who have been employed for at least 3 months before the birth of the child are entitled to 2 weeks of paid paternity leave under the Government-Paid Paternity Leave scheme, provided that the child is a Singapore citizen.
Employers may grant their employees 2 additional weeks of paternity leave on a voluntary basis. From April 1, 2025, the additional 2-week voluntary leave will become mandatory.
Paternity pay is capped at SGD 2,500 per week.
Parental Leave
Employees with children covered by the Child Development Co-Savings Act (CDCA) shall be entitled to up to 10 weeks of shared parental leave, which is implemented in phases as follows:
| Shared parental leave | |
|---|---|
| From April 1, 2025 | Eligible parents will be entitled to 6 weeks parental leave, shared between both parents. |
| From April 1, 2026 | Eligible parents will be entitled to 10 weeks parental leave, shared between both parents. |
Each parent is allocated half of the total shared parental leave by default, though they can subsequently reallocate their share within 4 weeks from the child's birth.
This leave can be taken within the 12 months after the child's birth, and it shall be paid in full initially by the employer. The employer may apply for reimbursement from the government, up to a certain capped amount.
Infant Care Leave and Childcare Leave
Eligible employees are entitled to infant care leave and childcare leave under the Government-Paid Childcare Leave scheme. Otherwise, they are entitled to childcare leave under the Employment Act.
Infant Care Leave and Childcare Leave under the Government-Paid Childcare Leave Scheme
Employees with at least 3 continuous months of service shall be entitled to take 12 days of unpaid infant care leave per year if their child is a Singapore citizen. This leave can be taken at any time until their child reaches 2 years old.
Furthermore, these employees are also entitled to 6 days of paid childcare leave per year until their child reaches 7 years old. This leave cannot be accumulated and must be taken by the end of each year.
In any case, childcare leave under this scheme is capped at 42 days for each parent and is paid for up to SGD 500 per day. The childcare leave pay shall be covered equally by the employer and the government.
Childcare Leave under the Employment Act
An employee who has been employed for at least 3 months shall be entitled to 2 days of paid childcare leave per year until their child reaches 7 years old. Each parent shall be entitled to up to 14 days of childcare leave per child, with any leave not taken by the end of each year being forfeited without any payment in lieu.
National Service Leave
Employers are required to grant leave of absence to employees for the entire period that they are called upon to attend Operationally Ready National Service (ORNS) activities, with the dates stated in the SAF100 served to the employee.
Whether an employer continue to pay their employees' salary while they are on leave shall depend on whether the employer is registered for the Direct Reimbursement to Employers of Claims for NS Training (DIRECT) Scheme.
| On DIRECT Scheme | Not on DIRECT Scheme |
|---|---|
| Employees shall continue to receive their usual salary per their regular pay schedule as though they had not been away from work. The employer will be reimbursed by MINDEF/MHA. | Employers shall deduct the employee's salary based on the amount of time they were on leave. MINDEF/MHA will reimburse the auto-generated MUP amounts directly to the employee's bank account number. |
An employee's usual salary includes the full sums of basic monthly salary and fixed monthly allowances, as well as additional payments (e.g. overtime pay) or variable payments (e.g. commissions) typically paid on a monthly basis.
For additional and/or variable payments, the employer can determine the amount they would have typically paid based on an average of the past variable payments received prior to their leave.
Note: If the employee's civilian income is less than SGD 1,600 per month (base NS Pay), MINDEF/MHA will credit the difference between the base NS Pay (pro-rated by the duration of the ORNS activity) and their civilian income loss directly to their bank account.
In any case, employers should continue to pay their employees' CPF contributions based on their usual remuneration. The CPF contributions payable by both employer and employee remain the same and are based on prevailing CPF Board guidelines.
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