Parliament: Employment Act amended to make payslips and employment terms more transparent

SINGAPORE - Employers who do not issue itemised payslips or spell out employment terms in writing for their workers can be fined under changes to the law approved by Parliament on Monday.

The Bill also sets up a administrative penalty framework to make less severe breaches of the Employment Act (EA) non-criminal.

According to a statement from the Ministry of Manpower (MOM), the key changes to the employment act are outlined below:

Itemised payslips

MOM will require employers to provide itemised payslips to all their employees covered under the EA together with their salary payments. Employers however have some flexibility, including whether to issue the payslips in soft or hard copy, as long as they reflect the required breakdown of items; as well as the ability to consolidate payslips if payments are made more than once a month.

Key Employment Terms (KETs)

MOM will require employers to provide written KETs to all employees covered under the EA with continuous employment of at least 14 days with the company. Employers will also have some flexibility in how they provide the KETs as long as the required items are clearly accessible.

Currently, all breaches of the Employment Act are criminal offences. The breaches include:

a) Failure to provide itemised payslips
b) Failure to provide written KETs
c) Failure to keep detailed employment records
d) Provision of inaccurate information without fraudulent intent to the Commissioner for Labour or inspecting officers

According to the MOM, the new requirements will come into effect on April 1, 2016. However, in view of strong feedback from the smaller SMEs who will be most affected by these changes, employers will be given a one-year grace period, where MOM will adopt a "light-touch enforcement approach".

candicec@sph.com.sg