Hiring in Singapore? What you need to know about changes to Singapore Employment Law

Expanding your business into Singapore has always been a challenge due to strict regulations set out in the Singapore Employment Act. But, in May 2021 hiring in Singapore has become even more challenging thanks to new rules for dependant’s pass holders. In this blog we’re taking a look at the changes to Singapore Employment Laws, what it means for businesses and how you can navigate the new rules for dependant’s pass holders.

What Is a Dependant's Pass?

Put simply, a Dependant’s Pass (DP) allows spouses and children of Employment Pass holders to join them in Singapore. A DP holder was eligible to work in Singapore for up to two years once they had gained a Letter of Consent (LOC) from an employer.

However, as of May 2021 this has all changed and employment laws have tightened around Dependant Pass Holders.

What Are the Changes for Dependant Pass Holders? 

As opposed to being able to work on a DP, DP holders who wish to work in Singapore must instead apply for their own permit. There are three types of work permits in Singapore; an Employment Pass, S Pass or Work Permit, each of which have separate requirements and conditions.

For the meantime, those working under a DP can continue to do so. However, when their current DP expires, they must re-apply under the new laws. It is important to note that there are no guarantees that DP holders who are currently working under a LOC will be accepted for a work permit, creating worry for current DP holders and indeed new applicants.

The only people exempt from Dependant Pass Holder changes are business owners. Business partners, directors or proprietors who own at least a 30% share in a business that hires at least one resident of Singapore can continue to run their business under a LOC. As with work permits however, there are certain conditions that must be met by business owners.

What Do Changes to Singapore Employment Law Mean for Businesses?

When hiring in Singapore, businesses come up against multiple employment laws and restrictions; these new rules for Dependent Pass Holders are another hurdle that expanding businesses must overcome.

Without the ability for their spouse or children to work under a DP, many employees may be put off moving to Singapore for work purposes, hence providing talent shortages and logistical obstacles to business expansion. It also poses problems for businesses who already employ foreign workers in Singapore and those who are sponsoring DPs for employees’ spouses. When current LOCs expire, employees may leave Singapore if their spouse is not granted a permit under the new rules.

How Can Businesses Overcome Changes To Singapore Employment Law?

In order to overcome changes to Dependant’s Passes, employers will have to sponsor work permits for employee spouses or instead risk losing current and new employees. The former will be a huge task that involves evaluating the type of work permit a dependant will need and then navigating the application process for this. It’s also worth noting that applying for spouse work permits could impact a business’ dependency ration. The latter meanwhile could risk a talent shortage for expanding businesses in Singapore. Both solutions are hardly ideal, and this is where a PEO becomes invaluable for expanding businesses.

These changes to employment law in Singapore and the complex and costly ways in which businesses would need to overcome them, reinforce the importance of employing a recruitment and PEO partner in Singapore.

Work permits are already a complex and often challenging aspect of hiring in Singapore and these recent changes to Dependant’s Passes only add to this. Thus, the latest changes to employment laws in Singapore require extra time and financial resource that expanding businesses often do not have. Let Leap29 support and comply with changes to Singapore employment law and help facilitate work permits for both employees and their dependants on your behalf while you focus on expanding your business.

As a well-established recruitment agency in Singapore, we also have a wide network of local talent and Singaporean permanent residents (PR) across multiple sectors, including Engineering and Construction, Oil & Gas, Pharmaceuticals, Renewable Energy and Technology. Our first-hand knoweldge of Singapore Employment Law combined with our well-established recruitment experience means we can be the trusted Recruitment and PEO partner of choice for any size or type of business in Singapore.

To find out more about changes to Singapore Employment Law and how Leap29 can support your business expansion into Singapore contact us on +01625 788866enquiries@leap29.com or contact our Singapore office on +65 3163 9353.