How to Hire Remote Employees In

Singapore

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The Basics

Currency
Singapore Dollar (SGD)
Employer Taxes
19.35%
Payroll Frequency
Monthly
Official Language
English, Malay, Tamil and Mandarin Chinese
OVERVIEW

Employment in

Singapore

Hire Independent Contractors

Independent contractors or freelancers are self-employed individuals who provide services to companies as a non-employee. This is one of the most common ways companies tend to hire non-local designers, engineers, support reps, etc.

For legal and tax purposes, independent contractors are not classified as employees. They may work for multiple clients, set their own work hours, negotiate their pay rate, and decide how a job gets done.

For example, the IRS says that if an independent contractor or freelancer does work that can be controlled (what will be done and how it will be done) by an employer then they are, in fact, classified as an employee.

As you can imagine, hiring someone as an independent contractor versus an employee is a fine line to tread.

While there are benefits when you choose the contractor route, there are quite a few drawbacks to consider and you’ll need to weigh them carefully to determine the best fit for your company.

Benefits of Hiring Independent Contractors

  • Reduced overhead: Lower cost in expenses, payroll, benefits, and more.
  • Greater flexibility: Contractors can be brought on as-needed. If not a good fit, you simply don’t have to move forward with the contract.
  • Reduced legal risk: Contractors aren’t usually protected by employment anti-discrimination and workplace safety laws.

Disadvantages of Hiring Independent Contractors

  • Risk of Misclassification: Not only does this deny workers their proper protections, it can also result in steep penalties and damage to your company. If the IRS determines that employee misclassification has occurred, you will be liable for a percentage of the employees wages, FICA contributions, penalty fines, unpaid taxes, up to a year in prison, and more.
  • Lack of Control: Contractors are drawn to being independent because it gives them greater control over the work they perform and who they work with. Because they’re not employees, you can’t tell them what to work on and how it should be done.
  • Lack of Loyalty: Contractors come and go as-needed. Many companies hire contractors for short-term work, which makes it difficult to cultivate loyalty.
  • Increased Scrutiny: Using Independent Contractors typically leads to an increased risk of being audited.
EMPLOYMENT IN
Singapore

Set up a subsidiary in

Singapore

A foreign subsidiary is a company that operates overseas as part of a larger company who’s HQ is in another country.

Establishing a foreign entity is great for having an international presence and accessing new markets. Though, setting up a subsidiary in Singapore can be expensive, stressful, and time-consuming. It's not for the faint of heart.

To set up a subsidiary in Singapore, you have to:

  1. Register your business name and file articles of incorporation
  2. File for local bank accounts
  3. Learn and keep track of the local employment laws
  4. Set up local payroll
  5. Hire local accounting, legal, and HR people

If you're lucky, this process can take months. If you're not so lucky, it can take up to a year. And on average, it costs about $50k-$80k, all-in-all, to get setup. And that's just for Singapore.

EMPLOYMENT IN
Singapore

Use an Employer-of-Record (EOR)

An employer-of-record (EOR) is a company that hires and pays an employee on behalf of another company.

An EOR is typically used to overcome the financial and regulatory hurdles that often come with employing remote workers.

Each country has its own payroll, employment, and work permit requirements for non-resident companies doing business in their jurisdiction. Meeting those demands can be a huge obstacle when it comes to hiring remotely.

At Panther, we help companies employ and pay people in over 160 countries, without having to set up a foreign subsidiary. Payroll, benefits, taxes, compliance, and more are all handled by us, at a fraction of the cost.

Outside of saving you months and tens of thousands of dollars, other advantages of using Panther are:

  • Ability to attract talented and motivated employees from all over the world.
  • Full legal compliance: There is no risk of violating local employment laws.
  • Transparency: Employees are still your employees. All the work, processes, operations and day-to-day business belong to you, the company, just like with any other employee. Panther just takes on all of the responsibilities, obligations and admin work related to your team's employment.
  • No risk of misclassification

Because you no longer have to set up your own subsidiary, you’ll save a ton of time and tens of thousands of dollars using Panther.

Hire with Panther

Paying Remote Employees

Paying employees in Singapore is not the same as paying workers in your own country. Employees have to be paid using Singapore’s employment and payroll standards.

This means that you have to know, understand, and keep up with 1) fluctuating currency changes, and 2) local payroll and tax laws in the countries you’re looking to hire in.

Outside of the laws and regulations around payroll, there may be different conditions surrounding leave, overtime, termination, and more. As you can imagine, maintaining this kind of regulatory knowledge can be challenging. But it is crucial and necessary to follow local legislation.

After, you’ll have to determine the best way to pay your international employees. This can be done in a number of ways, including but not limited to:

Pay through a local entity

One of the most challenging (and expensive) parts of paying international employees is setting up the infrastructure to do so.

Before you start to run payroll, you have to register your company as the local employer in the country the worker resides in. As you can see in the “Set up a subsidiary” section, this is a multi-step process that can take up to a year and put you on your way to bankruptcy.

Work with an EOR

Outside of EORs acting as the full admin employer, many also provide remote payroll.

For example, at Panther, in just 1-click, you’re able to pay your entire global team, anywhere in the world. We send you an invoice each month, charge you in US Dollars, and pay your employees the same amount in their local currency.

We factor in currency fluctuations and use the mid-market rate plus any applicable fee passed on by our provider at cost at the time of billing.

Singapore

 Specific Information

Working Hours

If an employee works a 5-day work week, a workday is up to 9 hours a day or 44 hours a week.

If an employee works a 6-day work week the workday is up to 8 hours.  

Overtime

For employees who are covered by the Employment Act, an employee must be paid 150% of the hourly basic pay of rate for any overtime hours.

Only the following employees are entitled to overtime: A non-workman earning up to $2,600.A workman earning up to $4,500.

What’s a Rich Text element?

The rich text element allows you to create and format headings, paragraphs, blockquotes, images, and video all in one place instead of having to add and format them individually. Just double-click and easily create content.

Static and dynamic content editing

A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

How to customize formatting for each rich text

Headings, paragraphs, blockquotes, figures, images, and figure captions can all be styled after a class is added to the rich text element using the "When inside of" nested selector system.

Taxes

Payroll Tax

Employer

19.35%
- Employer Contributions

Minimum Wage

Singapore does not have a minimum wage policy.

Payroll

Pay Cycle

Salaries are paid monthly, within 7 days of the end of the salary period.

13th Salary

“13th month payment” is called AWS. It is not compulsory.

Leave

Paid Time Off (PTO)

PTO is calculated by the:

  • Employees are entitled to a minimum of 7 days of annual leave after working in a company for three consecutive months.
  • Afterward one additional day is added per each year until reaching 14 days at the 8th year.   
  • However, it is common that the employee receives 14 to 20 days of annual leave. 

Public Holidays

There are 11 public holidays. If a public holiday falls on a non-working day, the employee should either receive a day’s salary in lieu of the holiday or an extra day off. If the holiday falls on a rest day, the upcoming workday will be a paid public holiday.

Sick Days

The duration of sick leave entitlement provided to workers is dependent on how long they have been employed by their employer:

  • 0-3 Months: 5 non-hospitalized/15 hospitalized days  
  • 4th Month: 8 non-hospitalized/30 hospitalized days 
  • 5th Month: 11 non-hospitalized/45 hospitalized days  
  • After 6 Months: 14 days non-hospitalized/60 hospitalized days 

The employee must inform their employer within 48 hours of inability to work and must provide a medical certificate upon return.

Maternity Leave

Paid maternity leave of 16 weeks is provided to female employees employed for more than 3 months prior to giving birth and the child is a Singaporean citizen. During this period, employers are prohibited from terminating the employment.

For the first and second child, the first 8 weeks are paid by the employer and additional 8 weeks can be reimbursed by the government.

For the birth of the third child and more, all 16 weeks of maternity leave can be reimbursed by the government.

If the child is not a Singapore citizen, maternity leave is 12 weeks

Paternity Leave

Paternity leave in Singapore is 2 weeks. To meet the requirements of Government-paid Paternity Leave (GPPL), the child must be a Singapore citizen and the father has or was legally married to the mother between the conception and birth of the child. 

In the case the child is adopted, the father is also eligible for paternity leave if the child is a Singapore citizen.

Parental Leave

Parents are entitled to 6 days paid childcare leave yearly if their youngest child is below the age of 7 and a citizen of Singapore.

Other Leave

Work-Related Injury Leave – The employer covers all work-related injuries that an employee has suffered either directly or through insurances.

The employee should receive 100% of their average monthly earnings in the 12 months prior to the disability for 14 days if not hospitalized.

After 14 days they shall receive 66.7%. As of September 1, 2020, all work-related medical leave must be reported to the Ministry of Manpower. 

Marriage Leave

None.

Bereavement Leave

None.

Termination

Termination Process

In the event of a termination of a local employee, the employee’s salary must be paid:  

Employee resigns and serves the notice period: On the last day of employment  

Employee resigns without notice and no notice period is served: Within 7 days of the last day of employment 

Termination due to misconduct: On the last day of employment, however, if this is not possible, the employee must be paid within 3 business days.  

Employer terminates the employment contract:  On the last day of employment, however, if this is not possible, the employee must be paid within 3 business days. 

Notice Period

The notice period in Singapore is:

1 day notice for less than 26 weeks of employment

1 week notice for employees who have been employed more than 26 weeks and less than 2 years

2 weeks’ notice for employment of more than 2 years and less than 5 years4 weeks’ notice for over 5 years of employment

Severance Pay

The severance payment includes all the salaries and benefits due at the last day of employment. If the employee has been employed for at least 2 years, they are entitled to receive “retrenchment benefits”.

The amount given to the employee depends on what is agreed upon in the employment contract or collective agreement when applicable.  

In general, retrenchment benefits are usually between 2 weeks to one month for every year the employee has served at the company.

Probation Period

Probation period is optional but common practice is 3-6 months.