If your company plans to hire foreign employees and managers, you should take note that there is an Employment of Foreign Manpower Act (EFMA) that protects their rights. In this article, we will explain the provisions of the act and identify your basic responsibilities as an employer according to the act.
Applicability of the Act
The EFMA covers any foreign worker who holds a work pass issued by the Ministry of Manpower (MOM). The work passes may be in the form of an Employment Pass, S Pass, or Work Permit. Although the EFMA works in sync with the Employment Act of Singapore, foreign domestic workers (FDW) are not covered in the Employment Act but only in the EFMA.
Importance of the law
The importance of EFMA is in supporting migrant workers in Singapore. The act regulates and protects the well-being of foreign manpower and sets the responsibilities of employers and intermediaries. Employment agencies are also covered in EFMA wherein there are a schedule of rules and licensing conditions when recruiting foreigners.
Through the EFMA, the MOM coordinates with Singapore agencies such as those concerned with housing, urban planning and environment, labour movement, NGOs, and embassies.
The EFMA is also instrumental in advocating for the labour rights of foreign workers in collaboration with civil society groups. In 2012, the EFMA was amended to add a clause for weekly rest days for domestic workers.
Key provisions of the Foreign Manpower Act
The EFMA details the employers’ obligations regarding application and cancellation of work passes, medical insurance, levy, employment cancellation, and repatriation.
One of the many important aspects in regulating foreign employment is MOM’s issuance of work passes. There are three main types of work passes:
- the Employment Pass (EP) for qualified managers and executives who earn a minimum of $4,500 monthly,
- the S Pass for mid-level skilled employees who earn a minimum of $2,500 monthly and have passed the assessments,
- and the Work Permit (WP) for FDWs and semi-skilled workers in the construction, manufacturing, marine shipyard, or services industry.
It is important to take note that the regulation of foreign manpower employment in Singapore is governed by three acts — the Employment of Foreign Manpower Act (EFMA), the Immigration Act, and the Employment Agencies (EA) Act.
The Immigration Act ensures that the entry and exit of a foreign employee are legal. Otherwise, an immigration offender found at a workplace will be penalised with heavy fines and/or imprisonment. Employers also must ensure the authenticity or accuracy of their foreign employees’ passes.
It is also an offence of employers to engage the services of unlicensed agencies. In the same manner, licensed agencies can lose their licenses if they process recruitments on behalf of unlicensed agencies.
According to the MOM, the most common offences and penalties related to EFMA are as follows:
|Employing a foreign employee without a valid work pass||A fine between $5,000 and $30,000, or imprisonment for up to 1 year, or both.|
For subsequent convictions, offenders face mandatory imprisonment and a fine between $10,000 and $30,000.
|Contravening any condition of a work pass||A fine up to $10,000, or imprisonment for up to 1 year, or both.|
|Making a false statement or providing false information in any application or renewal of a work pass||A fine up to $20,000, or imprisonment for up to 2 years, or both.|
|Receiving money in connection with an employment of a foreign employee||A fine up to $30,000, or imprisonment for up to 2 years, or both.|
|Obtaining a work pass for a foreign employee for a business that does not exist, or is not in operation, or does not require the employment of the foreign employee||An imprisonment term of 6 months and a fine not exceeding $6,000. Offenders may also receive caning.|
Compliance strategy for employers
If you are planning to hire foreign employees or executives and ensure compliance with EFMA, there are some strategies you can apply.
Have a contract in place
Drafting contracts and templates protect both your company and the foreign employee. Also, a knowledgeable local HR manager must review the contract to ensure that the clauses are following EFMA’s provisions on work passes, levy, medical insurance, severance, repatriation, and others that are also covered by the Employment Act.
Outsource hiring to a trusted firm
Another strategy that you can implement is to outsource the entire process of hiring foreign employees to a reliable partner. An added benefit of outsourcing is that your in-house staff and resources can be freed from the burdens of hiring tasks and they can focus on what they do best.
Some gaps in the talent pool can only be filled by hiring foreign employees. If your company considers recruiting from overseas, it is crucial to ensure that your hiring process is in accordance with the Employment of Foreign Manpower Act of Singapore. When you partner with Acclime, we can help evaluate your employment procedures, check employment contracts, and secure the appropriate work pass for your foreign staff.
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