Every hire your company makes rests on a contract, whether or not anything is written down. The moment an employee starts work and you start paying them, a legally binding employment relationship exists. The question is not whether you have an employment contract — you do — but whether it is written, clear and compliant. In Singapore, getting this right protects both the employer and the employee, and it is increasingly a matter of legal obligation rather than good practice.
This guide explains what an employment contract must contain, the Key Employment Terms rules, the statutory minimums that apply regardless of what the contract says, and the mistakes that expose employers to disputes.
The Legal Framework
The main statute is the Employment Act 1968, Singapore’s core labour law. Since April 2019 the Act covers all employees under a contract of service (with limited exceptions such as seafarers and domestic workers), including managers and executives (PMEs). However, certain protections — on working hours, rest days, overtime and public holidays under Part 4 — apply only to workmen earning up to S$4,500 a month and other employees earning up to S$2,600 a month.
Alongside the Employment Act sit the Ministry of Manpower requirements, the Central Provident Fund Act (for CPF contributions), the Child Development Co-Savings Act (for parental leave) and the various Tripartite Guidelines that shape fair employment practice.
Key Employment Terms: The Written Statement You Must Issue
Employers must issue Key Employment Terms (KETs) in writing to employees who are covered by the Employment Act, are employed for 14 days or more, and started on or after 1 April 2016. The KETs must be given within 14 days of the start of employment. They can be in a single contract, a letter, or a combination of documents, and can be in soft or hard copy.
The KETs must include, among other items:
Full name of employer and employee; job title and main duties; start date; duration (if fixed-term); working arrangements (daily hours, number of working days per week, rest day); salary period and basic salary; fixed allowances and deductions; overtime payment period and rate (if applicable); other salary components such as bonuses and incentives; type of leave (annual, sick, hospitalisation, maternity, childcare); medical benefits; probation period; and notice period for termination.
Statutory Minimums the Contract Cannot Undercut
A contract cannot contract out of the law. Whatever the document says, these statutory floors apply:
| Entitlement | Statutory position (Employment Act) |
|---|---|
| Annual leave | From 7 days in the first year, rising to 14 days, for employees covered by the leave provisions with at least 3 months’ service |
| Paid sick leave | Up to 14 days outpatient / 60 days hospitalisation per year, after qualifying service |
| Public holidays | 11 paid gazetted public holidays |
| Salary payment | Within 7 days of the end of the salary period; overtime within 14 days |
| Itemised payslips | Compulsory, issued with payment or within 3 working days |
| CPF | Payable for Singapore Citizen and PR employees |
Parental leave (maternity, paternity, shared parental and childcare leave) is governed largely by the Child Development Co-Savings Act, with enhancements phased in over recent years. Payroll and CPF obligations are covered in detail in our Singapore payroll and CPF guide.
What a Good Employment Contract Should Also Cover
Beyond the statutory KETs, a robust contract addresses matters the law leaves to the parties:
Confidentiality and intellectual property. Who owns work created during employment, and what information the employee must keep confidential.
Restrictive covenants. Non-compete and non-solicitation clauses. Singapore courts will only enforce these where they protect a legitimate proprietary interest and are reasonable in scope, duration and geography. Overbroad clauses are struck down.
Termination and notice. The notice period each side must give, and grounds for summary dismissal for misconduct. Notice must be the same for both parties unless otherwise agreed.
Flexible work arrangements. With formal request procedures now expected of employers, it is sensible to reference your policy — see our guide to flexible work arrangements.
Workplace injury. Where relevant, note the interaction with the Work Injury Compensation Act.
Foreign Employees
Where you employ foreign nationals, the employment contract must be consistent with the terms declared in the relevant work pass application and with the pass conditions. Salary, job scope and other declared particulars should match. Our guides to the S Pass and to the Foreign Worker Levy set out the employer obligations that sit around the contract.
Common Mistakes
The frequent errors are: not issuing KETs at all, or issuing them late; using a foreign template that ignores Singapore statutory minimums; unequal notice periods; unenforceable, blanket non-compete clauses; failing to issue itemised payslips; and treating PMEs as if they are outside the Employment Act (they are not, since 2019). Each of these surfaces at exactly the wrong moment — usually during a termination dispute.
How Raffles Corporate Services Can Help
Raffles Corporate Services prepares Singapore-compliant employment contracts and KET statements tailored to your business, reviews existing templates against current statutory minimums, and advises on notice, confidentiality and restrictive covenant drafting. Where foreign hires are involved, we align the contract with work pass conditions so the paperwork holds together.
If your contracts were drafted years ago, or borrowed from an overseas parent, a review now is far cheaper than a dispute later.
— The Editorial Team, Raffles Corporate Services