Employment Singapore Client Alert July 2015 Singapore Government further tightens the rules with respect to hiring foreigners: How would these changes affect employers? Overview On 8 July 2015, the Ministry of Manpower (“MOM”) announced a slew of measures with the objective of strengthening a core Singaporean workforce. These measures are a combination of incentives and tougher rules for employers, most of which will take effect on 1 October 2015. The key changes that would affect most employers in Singapore are: 1) Employers will be required to publish the salary range of the job vacancy they post in the Jobs Bank as part of the Fair Consideration Framework (“FCF”); 2) The MOM will increase scrutiny of Employment Pass (“EP”) applications for employers which have fewer Singaporean Professionals, Managers and Executives (“PMEs”) relative to other employers in their industry; 3) Employers who employ mature Singaporean job-seekers for certain midlevel positions will be entitled to claim wage support; 4) More stringent assessment of foreign PMEs who are applying for EPs; and 5) An Employment Claims Tribunal (“ECT”) is scheduled to be set up in the first quarter of 2016. Publishing of salary range To comply with the FCF’s advertising requirement, employers will now be required to publish the salary range of the job vacancy that they post in the Jobs Bank. EP applications whereby the job advertisement did not state a salary range will be rejected. This requirement will come into effect on 1 October 2015. Increased scrutiny with respect to EP applications EP applications by employers which have a lower number of Singaporean PMEs relative to others in their industry will be scrutinised by the MOM more closely. The MOM will require such employers to submit more information to check whether Singaporeans have been considered fairly. Such information may include, but is not limited to: • The number of job applications submitted by Singaporeans in response to the job vacancy advertisement; • Whether any Singaporeans were interviewed for the relevant job vacancy; and For further information please contact: Kelvin Poa +65 6434 2524 firstname.lastname@example.org Celeste Ang +65 6434 2753 email@example.com Ng Zhao Yang +65 6434 2701 firstname.lastname@example.org Clarence Ding +65 6434 2662 email@example.com Baker & McKenzie.Wong & Leow 8 Marina Boulevard #05-01 Marina Bay Financial Centre Tower 1 Singapore 018981 www.bakermckenzie.com Client Alert | 2. • A breakdown of the number of Singaporeans in PME positions at various levels within the employer. In our experience, the MOM has already started requesting such information from our clients and have even asked them to provide a plan detailing steps that they intend to take to hire more Singaporeans and reduce their dependency on foreigners. Provision of wage support Come 1 October 2015, the Workforce Development Agency will implement a new Career Support Programme (“CSP”) which aims to encourage employers to hire more mature Singaporean PMEs. The CSP is projected to run for 2 years. Employers who employ mature workers who have been looking for jobs for at least 6 months in mid-level jobs that pay at least S$4,000 will be given wage support. The exact amount would depend on the age of the PME and duration of employment as set out in the table below. For PMEs aged 50 and above For PMEs aged between 40 and 50 Wage support for first 6 months: 40% of gross monthly salary, capped at S$2,800 a month 20% of gross monthly salary, capped at S$1,400 a month Wage support for next 6 months: 20% of gross monthly salary, capped at S$1,400 a month 10% of gross monthly salary, capped at S$700 a month More stringent checks on foreign PMEs Currently, the MOM bans EP applicants with forged qualifications from working in Singapore for life. Now, the MOM will also reject work pass applications which contain doubtful qualifications such as those from degree mills. In addition, the MOM intends to place more weight on the relevant experience of EP and S pass applicants, especially for those applying for professional occupations. Employment Claims Tribunal The ECT, which is to be set up in the first quarter of 2016, would provide PMEs who earn more than S$4,500 a month and as such are not covered by the Employment Act (Cap. 91) with an avenue to resolve their statutory and contractual salary-related disputes through adjudication. Conclusion The MOM is stepping up its efforts to create a workforce with a strong Singaporean core. These measures are just the latest in many which were first announced in September 2013. It is likely that more of such changes are in the pipeline. Accordingly, employers would need to be cognizant of the tougher rules with respect to hiring foreigners and also consider whether they wish to rely on the incentives available and hire more Singaporeans. ©2015 Baker & McKenzie. All rights reserved. Baker & McKenzie International is a Swiss Verein with member law firms around the world. In accordance with the common terminology used in professional service organizations, reference to a “partner” means a person who is a partner, or equivalent, in such a law firm. Similarly, reference to an “office” means an office of any such law firm. This may qualify as “Attorney Advertising” requiring notice in some jurisdictions. Prior results do not guarantee a similar outcome.