Why Singapore Is a Strategic Hiring Market

Singapore offers a business-friendly environment with strong legal frameworks, making it an ideal location for international hiring. With English as the working language, a highly educated workforce, and excellent infrastructure, it’s especially attractive for remote and regional teams. Its strategic time zone overlap and digital readiness make onboarding seamless for global companies.

Legal Hiring Models for Foreign Companies

1. Setting Up a Local Entity

• Most common: Private Limited Company (Pte Ltd)
• Requires at least one local director and a registered business address
• Grants full control, but involves administrative and compliance costs

2. Employer of Record (EOR)

• A third party employs talent on your behalf
• Enables compliant hiring without a local entity
• Faster setup, ideal for testing the market

3. Independent Contractors

• Suitable for project-based or freelance work
• Must ensure classification is appropriate to avoid legal risk

Key Legal Considerations

Work Passes and Visas

• Employment Pass (EP) is required for foreign professionals (SGD $5,000/month minimum salary as of 2025)
• Jobs must be posted on MyCareersFuture for 14 days before EP application under the Fair Consideration Framework (FCF)

Employment Contracts

• Must be written in English and include:
  
  • Job title and description
  • Salary and benefits
  • Working hours and leave entitlements
  • Termination clauses and notice period

Statutory Contributions

• Central Provident Fund (CPF) applies to Singapore Citizens and Permanent Residents
• Foreigners on EP are not eligible for CPF but should receive private benefits (e.g. insurance, bonuses)

Leave and Holidays

• Minimum 7 days of paid annual leave, increasing with years of service
• 11 public holidays; if an employee works on a holiday, a replacement day off or additional pay is required

Unique Things to Watch For When Hiring in Singapore

1. Mandatory Local Job Posting (Fair Consideration Framework)‍

Before applying for an EP, employers must advertise the role on MyCareersFuture.sg for at least 14 days to ensure locals are given fair consideration.

2. CPF Not Applicable for Foreign Workers—but Alternatives Are Expected‍

CPF is mandatory for Singaporeans and PRs but not applicable to EP holders.
Employers are expected to offer private benefits like medical insurance or bonuses to stay competitive.

3. Written Contracts Are Strictly Required

Employment contracts must comply with the Employment Act and include all key terms, even for part-time or short-term staff.

4. Payslips and Recordkeeping‍

Employers must issue itemized payslips and retain all employment records (e.g. salary, leave, hours) for at least 2 years. The Ministry of Manpower may inspect these at any time.‍

5. Local Director Requirement for Incorporation

Foreign companies establishing a Singapore entity (Pte Ltd) must appoint at least one local director who is a Singapore citizen, permanent resident, or EntrePass holder.‍

6. Mandatory Compliance with Fair Employment Guidelines

Job advertisements must not contain discriminatory language based on age, gender, race, or religion.
Employers must follow the Tripartite Guidelines on Fair Employment Practices, or risk being flagged by MOM.

7. Termination Rules and MOM Notification‍

Terminating employment requires notice or pay in lieu of notice, depending on contract terms.
In cases of retrenchment or large-scale termination, employers must notify MOM and support affected employees in job placement.

8. Sector-Based Minimum Wage (PWM)

‍While Singapore does not have a universal minimum wage, certain sectors such as cleaning, security, and landscaping are covered under the Progressive Wage Model (PWM). Employers must meet the wage floors defined in these schemes.

9. Paid Sick Leave and Hospitalization Leave

After 3 months of service, employees are entitled to up to 14 days of paid outpatient sick leave and up to 60 days of hospitalization leave, subject to medical certification.

‍

To-Do Checklist for Hiring Talent in Singapore as a Foreign Company

☐ Determine if you’ll set up a local entity or use an EOR
☐ Draft a legally compliant employment contract (in English)
☐ Apply for Employment Passes or relevant work permits as needed
☐ Register company and employees with MOM (Ministry of Manpower)
☐ Set up compliant payroll and leave-tracking systems
☐ Ensure proper classification: employee vs contractor
☐ Adhere to public holiday replacement and leave entitlements
☐ Maintain complete HR documentation and payslips
☐ Stay updated on changes to EP eligibility and salary thresholds
☐ If applicable, partner with a Singapore-based EOR for compliance support

Final Thoughts

Singapore’s transparent regulations and skilled talent pool make it one of Asia’s most attractive hiring destinations. By understanding the country’s legal structure and cultural expectations, foreign companies can confidently hire and retain top talent.

‍