Salary thresholds for local full-time, part-time employees to rise

26 May 17

SINGAPORE

IMPACT – MEDIUM

What is the change? Singapore will soon raise the salary thresholds that companies must meet in order to count local employees as full- or part-time employees when calculating their foreign worker quotas.

What does the change mean? Effective July 1, locals must earn at least 1,100 Singaporean dollars (about US$795) per month to be considered as full-time employees for quota purposes. Local employees must earn between at least SG$550 (and less than SG$1,100) to be considered part-time employees. Effective July 1, 2018, locals must earn at least SG$1,200 per month to be considered full-time employees. Local employees must earn between at least SG$600 (and less than SG$1,200) to be considered part-time employees.

  • Implementation time frame: The salary thresholds will be raised July 1, 2017 and again July 1, 2018.
  • Who is affected: Employers in Singapore who are required to calculate their foreign worker quotas in order to sponsor foreign employees on work permits and S-passes.
  • Business impact: Companies should take the new salary thresholds into account when planning their budgets and calculating their foreign worker quotas.

Background: Singapore promotes the localization of its workforce by imposing quotas on how many foreign employees companies can hire based on the number of local workers (i.e., Singaporean citizens or permanent residents) they employ. For quota purposes, full-time workers count as one local employee and part-time workers count as one-half of a local employee. The salary thresholds outlined above were included in Singapore’s 2017 budget.

BAL Analysis: BAL is available to assist clients in calculating their foreign worker quotas or to answer questions about how much local workers must be paid under the salary thresholds. Additional information is also available on this Ministry of Manpower website.

This alert has been provided by the BAL Global Practice group in Singapore. For additional information, please contact singapore@balglobal.com.

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