Employers in Singapore Mis-Labeling Staff to Avoid OT Payments

Raising Concerns: Employers in Singapore Mis-Labeling their Staff to Avoid OT Payments

Employers in Singapore apparently escaped paying their employees entitlements like OT payments after they allegedly classified them as managers or executives.

According to the Ministry of Manpower, there were about 50 such cases last year. Among them, 90 percent of victims had the evidence to back their complaints.

A spokesman from MOM said the government views this matter seriously. This is because it is a clear attempt to avoid certain obligations by the employers.

However, he said cases of misclassification were relatively low compared to other complaints.

“The 50 cases make up less than one percent of all cases. There are many more referred to the Tripartite Alliance for Dispute Management (TADM),” said the spokesman.

Under provisions of the Employment Act, those who earn below $2,500 a month have the rights for overtime payments.

The way employers can avoid this is to classify them as managers of executives.

Labour MP, Patrick Tay had on June 21 said in a blog posting that some employers had inflated job titles to avoid the overtime claims.

According to his estimate, there were about 30,000 workers in Singapore who earn less than $2,500 a month. Still, they have been classified as professionals, managers, and executives.

 

Ministry of Manpower Taking a Stronger Stand

MOM said that it will assess each case individually based on the job scope and according to the law.

“We will consider the level of authority and decision making powers in the management of the business function, recruitment, discipline and termination of employment,” said MOM.

The MOM also pointed out a recent High Court judgment. The judgment made it clear that a person who holds a supervisory function is not automatically an executive.

Where necessary, MOM and TADM will be guided by this High Court decision.

In March, the MOM said it will amend the law later this year to extend protection in the Employment Act regardless of their pay and whether they are in managerial or executive positions.

The current Act only covers those who earn up to $4,500 a month.

According to Tay, though only 50 cases were reported to the ministry, most were strong cases.

He urged the estimated 30,000 professionals earning less than $2,500 a month to take a closer look at their employment contracts. They need to have a better view of the job roles and responsibilities to assess if they are eligible for overtime claims.