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MOM's Labour Court Helped More Than 700 Workers Recover About $750,000 in First Half of 2010

Employment practices
28 September 2010

  1. The first six months of 2010 saw more than 700 local workers recover some $750,000 collectively from their employers through the Labour Court. The majority of the claims involved salary arrears, notice pay and encashment of annual leave.
  2. The Labour Court issued orders for payments to be made to some 400 workers. 80% of these cases were concluded within 1 month from claim registration. Another 300 reached out-of-court settlements with their former employers after the Ministry's intervention.

    Salary Arrears Remain the Top Violation under Employment Act
  3. Salary arrears remained the most common Employment Act violation, with about 4 in 5 employment claims involving such cases.

    Case 1: Notice Period in the Employment Act applies when there is no contractual agreement on notice period
  4. In March 2010, 3L Logistics & Warehouse Pte Ltd terminated the employment of one of its employees without paying him salary in lieu of the termination notice. The employee was also owed the encashment of his annual leave. At the Labour Court hearing, the employer claimed that no notice had to be given since there was no agreement.
  5. The Labour Court informed the employer that if there was no agreement on notice period, the provisions in the Employment Act would apply. In this case, as the worker has worked for more than 3 years, he ought to have been given 2 weeks' notice or be paid 2 weeks' salary. The company was ordered to pay the worker 2 weeks' notice pay and eight days of annual leave, bringing the total amount awarded to $950.

    Case 2: Notice Periods can only be waived by mutual consent.
  6. In January 2010, a teaching assistant of Etonhouse Pre-School Pte Ltd was given a "release letter" stating she was "released" from employment and she was not required to serve the one month's notice stated in her employment contract. The employee filed claim for salary in lieu of notice. The Labour Court ruled that by "releasing" the worker, the school was in effect terminating her employment and the party to terminate the employment relationship had the obligation to give notice to the other party. As there was no consent from the employee to waive the notice she was entitled to receive, the company was ordered to pay the employee one month's notice of $1, 520.00.

    Case 3: Unlawful retention of worker's salaries
  7. A spa consultant hired by Aromatic House Pte Ltd resigned from employment, and his last day of work was 11 April 2010. The company did not pay him his last month salary and commission earned over three months. At the Labour Court hearing, the employer explained that payments were withheld because the employee failed to serve out the full notice period.
  8. The worker explained that he had 5 days of annual leave, and so he stopped work on 5 April 2010. The Labour Court informed the worker that leave was subject to the company's approval at all times and since he had absent himself from work without permission, his 5 days of annual leave would be used to offset his notice pay. The Labour Court found no other reasons for the company to withhold pay and ordered the company to pay the remaining salaries and commission amounting to $2, 588.40.

    Case 4: Employers should not withhold or deduct salaries
  9. A programmer from Premplas Technologies Pte Ltd filed claims with MOM for non-payment of salary and overtime pay.
  10. The Labour Court heard that the employee was offered a position as a setter instead of a programmer one month into his employment. When he was still considering his company's offer, he claimed he was asked to leave employment instead. He was not paid his salary and overtime pay for February 2010. The company admitted that they did not pay the worker his salary as the worker had not made compensation to the company for damaging some equipment during his employment. The company said that overtime pay was not paid as the worker failed to produce his time-card to the HR department for verification. The company also submitted a counter-claim for notice pay as they claimed that the worker has left the office without completing the day's work.
  11. The Labour Court ruled that the company had to pay the worker his outstanding salary. Any damage to goods has to be proven and the company was advised to pursue the compensation at the civil courts if they wished to. As for overtime payments, the Labour Court reminded the company that the onus of proof was on them to have the records made available. The company and the worker subsequently agreed to set the overtime at 25 hours. The Labour Court allowed the company's counter-claim on notice pay, as the worker has indeed not served out his notice completely. The Labour Court therefore ordered the employer to pay the worker $1,957.07 for his February salary and overtime pay.

    MOM: Employee termination should be managed in a responsible manner
  12. Mrs Jeanette Har, Director, Employment Standards of the Labour Relations and Workplaces Division (张丽莲, 人力部劳资关系署 (就业准则处)处长) said, "The number of local workers who filed employment claims with the Labour Court has remained steady in the first half of 2010, compared to the same period last year. The cases seen by the Labour Court in the first half of 2010 highlight the lack of understanding of employment laws on the part of some employers and those who show little regard to honour their employment obligations. Workers should be paid their dues, and even when employment relationship ceases, parties should end their contractual obligations on fair and amicable terms. The Ministry hopes that by releasing these statistics and case examples regularly, employers could avoid common mistakes and better manage HR issues."
  13. Workers with employment claims and employment issues may approach the Ministry for advice and assistance. They could call the MOM hotline at 6438 5122 or make an e-appointment via MOM website to consult an officer on employment-related matters. Businesses keen to learn more about their roles and responsibilities as employers could contact the Tripartite Alliance for Fair Employment Practices (TAFEP). TAFEP provides practical guides and training to assist Singapore firms in their adoption of fair and responsible employment practices. You can contact TAFEP via email at query@fairemployment.sg, TAFEP website, or calling the TAFEP hotline at 6838 0969.