Singapore: Foreign hiring requirements to be tightened

Singapore’s Ministry of Manpower (MOM) recently announced that it will introduce new rules requiring firms to advertise job vacancies on a new ‘jobs bank’ administered by the Singapore Workforce Development Agency (SWDA) before a firm can apply for an Employment Pass (EP). Firms identified by MOM as needing to improve their hiring practices will come under additional scrutiny, face additional reporting requirements and may have their EP privileges curtailed.

The new rules come in the form of the ‘Fair Consideration Framework’ (FCF) and are aimed at encouraging firms to consider Singaporeans fairly before recruiting foreign nationals. They will come into effect from 1 January 2014 (in stages) and will be administered by MOM.

Under the FCF firms who wish to apply for an EP from 1 August 2014 will be required to:

• advertise the job vacancy on the SWDA’s ‘jobs bank’ for at least 14 calendar days;
• include in the advertisement certain information including job title, experience and salary range and ensure that it complies with the Tripartite Guidelines on Fair Employment Practices (which provide, inter alia, an employer should recruit and select employees on the basis of merit);
• ensure that jobs advertised are open to Singaporeans; and
• apply for an EP within 3 months of the closing date of the job advertisement and quote the advertisement ID in its application.

Employers may advertise through other means (including recruitment agencies) in addition to advertising on the ‘jobs bank’. The jobs bank will be launched in mid-2014 and advertisements will be free of charge.

Importantly, the advertising requirements will not apply to:

• firms with 25 or fewer employees; and
• job positions that pay more than a fixed monthly salary of $12,000.

Interestingly, there is no mechanism for unsuccessful Singaporean applicants to lodge a complaint with MOM, however, feedback can be given through its website.

Additional scrutiny of 'identified firms'

MOM will identify firms it considers have scope to improve their employment practices. By way of example, MOM have stated that these firms may include firms who:

• have a disproportionately low concentration of Singaporeans at senior levels compared to their industry peers; or
• have received repeated complaints of nationality-based or other discriminatory practices.

Those firms that are not required to follow the advertising rules may still be targeted for additional scrutiny. These ‘identified’ firms will be required to report certain information to MOM. If these firms do not improve their practices to MOM’s satisfaction it may:

• heavily scrutinise and impose a longer review period for EP applications;
• curtail the firm’s work pass privileges;
• require firms to attest that they will not displace any similarly employed Singaporean within 60 calendar days of applying or renewing an EP; and
• require firms to display a fact sheet regarding their reports to MOM in their workplace.

MOM will begin identifying firms for additional scrutiny and notify these firms from the first quarter of 2014.

Increase to qualifying salaries

The qualifying salary for new EP applications is also set to increase from SG$3,000 to SG$3,300 per month, although this figure has been set primarily for inexperienced graduates; more experienced applicants will need higher salaries to obtain an EP.

Timing and Transitional arrangements

The changes are being introduced in stages. All new EP applications will be subject to the revised qualifying salary from 1 January 2014. The advertising rules will begin on 1 August 2014.

Existing Employment Pass holders whose pass expires before 30 June 2014 will receive a one-time renewal with the same employer based on the existing criteria. However, passes which expire between 1 January – 30 June 2014 (inclusive) will be limited to a renewal of up to 1 year. Passes expiring after 30 June 2014 will need to meet the new criteria.

Action items for employers Employers will need to be aware of the changes to EP applications and renewals and ensure their internal human resources teams and external recruitment agencies are prepared.

For more information please contact Chris Cheung or Jessica Toop.