Techblog
Ministry of Manpower Payslip Requirements: Mandatory itemised payslips by 2016
The latest revisions to the Employment Act make it mandatory for SMEs to provide itemised payslips to employees starting early 2016. Here are the highlights of the changes that took place on July 13, 2015.
In April 2014, the Ministry of Manpower (MOM), National Trades Union Congress (NTUC) and Singapore National Employers Federation (SNEF) formulated tripartite guidelines for the issuance of itemised payslips and written Key Employment Terms (KETs) as part of changes to the Employment Act (EA).
Itemised payslips were not made mandatory then as SMEs expressed concerns over extra administrative costs that would be incurred to produce payslips for all employees. Now, 15 months later in July 2015, the Employment Act mandates the compulsory issuance of itemised payslips from all businesses to their employees, amongst other changes:
New requirements for SMEs from 2016 onwards
Mandatory itemised payslips: Tabled in Parliament in July 2015, amendments to the Employment Act (EA) will make it compulsory for employers to provide workers with itemised payslips, whether in hardcopies or electronic versions.
Key employment terms: Key employment terms (KETs) must also be made known within 14 days of employment.
Records of all employees: All employers are required to maintain records of all past and present workers.
More legal protection for employees
According to a recent report, MOM noted that “Itemised payslips and KETs benefit both employees and employers. They provide security and assurance to employees about their regular salary components as well as main employment terms and benefits. For employers, issuing payslips and KETs in writing helps to minimise employment disputes.”
Changes to the EA offer professionals, managers and executives earning up to S$4,500 more legal protection from cases like unfair dismissal and disputes over medical leave benefits.
Any breaches will subject businesses to a fine of up to S$1,000 on the first occasion and up to S$2,000 on subsequent occasions. The proposed changes will also grant MOM enhanced authority to issue penalties for any breaches of the EA, allowing the minister to mete out a fine of up to S$5,000 for a first conviction, and up to S$10,000 for subsequent convictions that take place within a year of the first offence.
How these changes affect SMEs and how can the transition be easier
Besides added time and resource constraints to meet these new requirements, it is anticipated that SMEs have to deal with certain issues like adjusting payslips for part-time employees and contractual staff who do not have fixed hours, or workers who are friends and relatives who may not be part of the official payroll structure.
Acknowledging feedback from SMEs, the MOM has pledged an initial light touch and an educational approach to help businesses make the transition easier.
Low-cost, accessible solutions are available to help businesses with issuance of itemised payslips. There are payslip templates which can be downloaded in multiple languages and software that can help SMEs generate payslips with ease.
In addition to the guidelines available on the MOM website for best practices while adopting the latest changes, there is also a guidebook to help understand all the changes in the EA.
The MOM’s online assistance package provides details on EA workshops conducted by government bodies, and employers can also seek advice from SNEF at by calling (+65) 6327 9297 or approach a Business Advisor at any local SME Centres.
Find out more about how to create MOM-compliant payslips for your business here.
To help SMEs to be compliant to the Ministry of Manpower requirements on issuance of itemised payslips and maintaining of records, myBusiness has introduced Essentials Payslip solution that allows SMEs to quickly and easily create and manage employee payslips. Get a FREE 5 users license version.