Ask five working adults who a “workman” is, and you will likely get a mix of different answers.
Under the Employment Act, a workman is an employee who engages in manual labour. While this definition has remained largely unchanged over the years, technological advances have revolutionised the work done by workmen, especially for heavy machinery operators. This can lead to some confusion about coverage of the protections for workmen under the Employment Act.
Many modern-day workmen operate advanced machinery and sophisticated digital systems in highly automated environments. Take, for instance, metal and machinery workers. Instead of physically toiling on the factory floor as they did in the past, many now operate equipment and robots remotely from air-conditioned control rooms.
Yet, under the Employment Act, it is unclear if some of these employees should still be classified as workmen and therefore entitled to additional protections around hours of work, rest days and overtime pay.
This is one reason the Employment Act is due for a review. As the key legislation shaping employment standards in Singapore, it must stay relevant to today’s fast-changing nature of work and relatedly, our workers.
Upholding the purpose of the Employment Act
While today’s economic landscape is vastly different from 1968 when the Employment Act was enacted, there are echoes of Singapore’s past in the challenges we face now.
Back then, the nation was bracing for the withdrawal of British military forces in 1971. In response, S Rajaratnam, then Minister for Labour and Minister for Foreign Affairs, introduced the Employment Bill to establish a standard set of employment conditions to protect employees, while driving productivity to strengthen business competitiveness and enhancing Singapore’s appeal to foreign investors. This was with the aim of ensuring the long-term economic well-being of our employees.
Today, the business environment is roiled by geopolitical tensions, economic uncertainties and intensifying competition for foreign investments. The review of the Employment Act should similarly seek to create a win-win outcome of safeguarding employees’ interests while supporting businesses to thrive.
Any amendments must avoid inadvertently making progressive employment practices a legal requirement. Such rigidity would limit workforce flexibility and undermine business competitiveness. Keeping Singapore attractive to foreign investment is vital to securing quality jobs for everyone and sustaining growth.
Overly progressive measures can make labour market more rigid, stifle business growth
One suggested reform under the Employment Act is requiring employers to provide a reason when they contractually terminate the employment of workers.
As others have noted, such a change would impose a significant one-sided legal burden on employers. Unlike employees who can claim for wrongful dismissal, employers have no recourse against employees who resign for disingenuous reasons.
Moreover, documented and justified dismissals can have profound consequences for the employee’s future career prospects. If dismissals are officially recorded as being due to poor performance or misconduct, they can leave a lasting stigma on the employee’s professional record.
This practice might also unintentionally foster a hiring culture where interviewees are expected to provide “evidence” for why they left previous jobs. At the same time, employers would become more cautious about offering permanent contracts to employees.
Such changes could undermine our harmonious workplace relations, without necessarily giving better protections to workers for wrongful dismissal claims.
Singapore’s current approach has its strengths and works well. It adopts a mediation-first approach to preserve employment relationships where possible and expedited resolution of claims via the Tripartite Alliance for Dispute Management and the Employment Claims Tribunals.
Where employers justify dismissals on the ground of misconduct or poor performance, the onus is already on the employer to prove so. Where employers dismiss without notice, the employer also bears the burden of proving that the dismissal was with just cause. Furthermore, employees can also lodge a claim for wrongful dismissal if they feel that they were forced to resign for wrongful reasons such as discrimination.
All in all, the existing framework has supported a flexible and dynamic labour market, while providing adequate protection to employees.
Striking a balance between business competitiveness and employee well-being
Although well-intentioned, any significant increase in statutory leave entitlement will strain business operational costs, especially for small and medium-sized enterprises (SMEs) that operate with limited resources and tight profit margins.
Compared to other developed economies in the region, the protections under Singapore’s Employment Act are not behind the curve. In Hong Kong, paid sick leave is provided at 80 per cent of average daily wages. In Japan and South Korea, employees are expected to dip into their annual leave for short illnesses, while longer absences are covered by social insurance schemes that do not fully replace salaries. In contrast, employers in Singapore are generally required to pay their employees as per normal when they take any type of statutory leave.
Notably, Ministry Of Manpower’s (MOM) survey on Employees’ Working Conditions in 2022 revealed that over 90 per cent of full-time resident employees aged 25 to 64 already received more than the statutory minimum of seven days of annual leave in Singapore. This shows that despite the Employment Act specifying a minimum annual leave of seven days, market forces would naturally lead to better outcomes for the vast majority of workers.
Imposing more leave entitlements could have significant impact on business operations. Imagine needing perhaps 5 to 10 per cent more skilled employees such as engineers and nurses, to cover extended absences and sustain essential operations. In a country already facing talent shortages, this could intensify costs pressures and stifle business growth. The increased operational rigidity could also make Singapore less attractive to foreign investors.
We must also draw valuable lessons from the experiences of European economies. Take Germany and France, where generous leave policies, unemployment welfare benefits and tax regimes may have discouraged work. The result: consistent reductions in working hours which also coincided with periods of slower economic growth and declining national productivity.
Crucially, leave entitlements are difficult to reverse once implemented, and any unintended consequences may only become apparent when it’s too late.
The review of the statutory leave entitlements in the Employment Act should therefore focus on establishing the essential minimum. This approach allows employers the flexibility to offer enhanced leave benefits beyond the baseline, tailored to industry norms, company capacity and employee needs. By striking the right balance, Singapore can continue to thrive as a global hub for both businesses and talent while supporting employee well-being.
To achieve the same goal of addressing employees’ caregiving needs, we can also study how the Employment Act might facilitate greater flexibility for both employers and employees, such as allowing time off in lieu of overtime pay.
Leveraging tripartism to shape norms without legislation
We must also not expect the upcoming review of the Employment Act to resolve all the complex workforce challenges that we face today. Better workplace norms should be established through market forces and promotion efforts rather than through legislation.
Beyond the Employment Act, Singapore has a strong ecosystem of Tripartite Guidelines, Advisories, and Standards. These instruments – collaboratively developed by the Singapore National Employers Federation (SNEF), National Trades Union Congress, and MOM – provide practical guidance and benchmarks on a wide range of employment practices, such as implementing flexible work arrangements, re-employment of older workers and enhancing workplace mental well-being.
What makes this approach so powerful is its adaptability. Instead of relying solely on setting rigid requirements under the law, it allows workplace norms to be adopted progressively. Employers who are ready to adopt best practices can lead the way, showing what is possible and modelling change. This approach avoids overwhelming businesses, in particular SMEs, with strict legal requirements they may not yet be ready for.
Employers big and small can thus focus on the essentials and enhancing their business viability so that they can grow and thrive and provide good jobs.
Looking forward
Fostering fair and harmonious workplaces is the shared responsibility of employers, employees and trade unions and the government. Singapore’s established tradition of strong tripartism provides a robust framework for conducting this Employment Act review effectively. SNEF will ensure that the perspectives of the diverse employer community are considered during the upcoming tripartite discussions and welcome further feedback from employers to inform the review of the Employment Act
As Singapore’s workforce and workplace landscape evolves, the Employment Act review should aim to navigate ongoing uncertainties and leverage emerging opportunities within the global economy, much like it successfully did in 1968.
Hao Shuo
Chief Executive Officer, Singapore National Employers Federation
[Published in The Business Times on 12 April 2025]
