Singapore announces first major review of employment laws since 2008

At a seminar setting out the department's workload for the coming year, Tan Chuan-Jin said the country's Employment Act needed to be reconsidered in the context of changes to the character of its labour force and evolving employment norms and practices.

"Today, we see a lot more outsourcing that is taking place," he said in his keynote speech. "As a result of that, there are changes to work arrangements, so we have short-term contracts, for example, emerging over the years."

The review would aim to improve "wage conditions for our low wage workers" and "better look after workers where the relationship with employers is less than balanced", he said. The MOM would also "step up" its efforts to ensure that the laws were being complied with.

The department would work closely with stakeholders and the public to "ensure that any amendments take into account the interests of both workers and employers", he added.

The Employment Act is Singapore's main labour law, and has been in force since 1968. It sets out minimum employment terms and benefits and provides workers with a forum to resolve disputes with their employers. The last major review of the Act, which was conducted in 2008, extended its provisions to cover workers earning up to $2,000 each month. However salaries in Singapore continue to increase, with average rises of about 2% per annum in real terms over the last five years, according to MOM figures.

Employment law expert Christopher Chong of MPillay, the joint law venture partner of Pinsent Masons, the law firm behind Out-Law.com, anticipated that the review would seek to boost medical benefits for low-paid workers and deal with discrimination in the workplace, with particular reference to discrimination against both local and foreign workers on the basis of their nationality.

"Although the Employment Act was only updated four years ago, a review is timely to keep pace with the rapid changes in Singapore's workforce," he said. "This will serve to address concerns that, at a time when the median wage of workers in Singapore is rising, the Act may no longer provide sufficient coverage to all of the workers it was originally intended to – particularly those who were at the borderline of the wage threshold of the Act."

The changes could also potentially extend the protection of the Employment Act to the growing percentage of professionals, managers and executives (PMEs) in the country, he said. These workers, who receive some protection under the Act in the case of salary disputes, could benefit from its additional assurances, he said.

PMEs form about 32% of the Singaporean workforce, up from 27% in 2001, according to MOM figures. Currently only those earning below $4,500 per month can rely on protection under the Act if there is a dispute over salary.