Employment Contracts In Singapore: Things To Look Out For

by 1 December 2023Knowledge & Insights

The importance of your employment contract in Singapore should never be underestimated. Often overlooked in the excitement of a new job, this crucial document sets the tone for your professional journey. It’s like your compass to help ensure the voyage is smooth, safeguarded, and free from contractual pitfalls.

It’s imperative to understand your employment contract thoroughly as it outlines the rights and responsibilities of both the employee and employer, making it a pivotal document in any professional employment relationship.

So, what to look out for in an employment contract in Singapore? Read this guide carefully.

9 Things To Check Before Signing An Employment Contract

Clarity And Specificity

The first thing to ensure in your employment contract is clarity. Every detail should be explicitly mentioned, from your job role to your salary components. Vague descriptions can lead to misunderstandings, disputes, and potential exploitation.

Salary And Compensation

Among the key employment terms to check is salary. Your employment contract should detail your total remuneration package. This includes your basic salary, any bonuses, allowances, and other employee benefits.

Given the high cost of living, understanding your full compensation in your employment contract  is essential to plan your finances.

Working Hours And Overtime Pay

Singapore has regulations about standard working hours and overtime. Your employment contract should explicitly mention your working hours, breaks, and overtime rates. Overtime rates in an employment contract in Singapore typically follow the Employment Act but are verified to ensure you’re adequately compensated.

Leave Entitlements

In addition to salary, a fair employment contract should also indicate leave entitlements. From annual leave to sick and maternity, paternity, and childcare leaves, they must be clearly defined in the employment contract. While many companies follow statutory minimums, some offer more generous packages.

Termination And Notice Period

One of the most critical sections in an employment agreement is the termination clause. This section outlines the notice period required from both parties and the conditions under which the contract can be terminated. Ensure that these terms are fair and in line with the Singapore Employment Act.

Confidentiality And Non-Compete Clauses

Many employment contracts in Singapore have clauses that restrict employees from sharing company secrets or joining competitors for a certain period post-termination. While non-compete and confidentiality clauses are standard in many employment contracts in Singapore, it’s vital to ensure they’re reasonable in scope and duration.

Dispute Resolution

While we all hope never to face disputes, it’s wise to know the process in case they arise. Whether it’s through internal mediation, arbitration, or seeking external legal aid, the employment contract should clearly define the steps in dispute resolution.

Miscellaneous Provisions

Some contracts have clauses about training bonds, where the company pays for your training but requires you to serve for a specific period post-training. You might need to repay the training costs if you leave before that. Such clauses, while not present in every employment contract in Singapore, should be approached with caution.

Medical Benefits

Check if the contract includes details about CPF contributions, leaves, and other medical and non-medical benefits. Some companies provide more medical benefits than what the Employment Act requires.


Conclusion About Employment Contracts In Singapore

An employment contract in Singapore is a foundational document in the employer-employee relationship. Ensuring that it’s fair, clear, and transparent protects your rights and paves the way for a healthy professional journey in Singapore.

In Singapore’s employment arena, being well-armed with knowledge is paramount. Should you ever find yourself navigating the murky waters of employment disputes or just needing clarity on contractual nuances, remember professional legal help is available to you.

Tembusu Law’s team of experienced corporate and business lawyers in Singapore stands ready to steer you to safer shores. Our team of lawyers handle various employment-related cases, providing the legal advice and assistance you need. Schedule your free 30-minute consultation today!


Frequently Asked Questions About Employment Contracts In Singapore

What If Some Clauses In My Employment Contract Contradict The Employment Act Of Singapore?

The Employment Act is the primary legislation governing employment contracts in Singapore. If a clause contradicts the Act, it’s likely to be unenforceable. Always consult a legal expert if in doubt.

Can I Negotiate Terms In My Employment Contract In Singapore?

Absolutely. An employment contract is an agreement between two parties. If you find certain terms unfavourable, you can always negotiate before signing.

Is It Mandatory For Every Employee To Have A Written Employment Contract?

While having a written contract for all employees is not legally mandatory, it’s highly recommended. A written agreement ensures clarity and protection for both parties.

What Should I Do If I Believe My Employment Contract Has Been Breached?

If you believe there’s a breach, it’s essential first to communicate with your employer. If the issue isn’t resolved, consider mediation or, in extreme cases, legal action. Consult with a legal professional for guidance.

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