If your Singapore company recruits, sources or places workers for other businesses, or supplies foreign manpower, you almost certainly need an Employment Agency (EA) licence from the Ministry of Manpower (MOM). Operating an employment agency without a valid licence is an offence under the Employment Agencies Act 1958, and the penalties are significant. This guide explains who needs a licence, the two licence classes, the fit-and-proper and examination requirements, the security deposit, and the step-by-step application process for 2026.
Raffles Corporate Services works closely with employers and recruitment businesses on manpower compliance, and our associated MOM-licensed employment agency handles work pass applications daily. If you are setting up a recruitment or manpower business, getting the licensing structure right from day one saves you from costly rejections and enforcement action later.
What Is an Employment Agency and Who Needs a Licence?
An employment agency is any business that carries out “employment agency activities”, which broadly means finding employment for job seekers or supplying and recruiting workers for employers, whether local or foreign. This captures headhunting and executive search firms, general recruitment agencies, maid or foreign domestic worker (FDW) agencies, and businesses that source and deploy foreign work pass holders for client companies.
The licensing regime is governed by the Employment Agencies Act 1958 and administered by MOM. If you carry on employment agency work without a licence, you may face a fine of up to S$80,000, imprisonment of up to two years, or both. Because the definition is wide, many founders are surprised to learn their business model requires a licence, so it is worth confirming your position before you begin trading.
The Two Classes of EA Licence
MOM issues two classes of licence, and the correct choice depends on the type of workers you place and the fees you intend to charge.
Comprehensive Licence
A Comprehensive Licence permits the agency to place all categories of workers, including foreign domestic workers and lower-wage Work Permit holders, and to collect placement fees from these workers within the caps allowed by law. Because these agencies serve more vulnerable workers, the requirements are stricter: a higher security deposit and a longer Certificate of Employment Intermediaries (CEI) course.
Select Licence
A Select Licence allows the agency to place local employees and higher-earning foreign professionals such as Employment Pass and S Pass holders, but not foreign domestic workers or Work Permit holders in the lower-wage categories. It suits headhunting, executive search and professional recruitment firms that deal with skilled candidates.
Key Requirements at a Glance
| Requirement | Select Licence | Comprehensive Licence |
|---|---|---|
| Security deposit (banker’s guarantee) | S$20,000 | S$60,000 |
| CEI qualification for Key Appointment Holder | CEI (KAH) for Select | CEI (KAH) for Comprehensive |
| Workers placed | Locals, EP and S Pass holders | All workers, including FDWs and Work Permit holders |
| Fit-and-proper assessment | Required | Required |
| Licence validity | Annual, renewable | Annual, renewable |
The security deposit must be furnished as a banker’s guarantee from an approved financial institution, not as a cash deposit. It is called upon by MOM if the agency breaches its licensing conditions.
The Fit-and-Proper Test and the CEI Examination
Every EA licence must have at least one Key Appointment Holder (KAH), typically a director, partner or sole proprietor, who is responsible for the agency’s compliance. The KAH must pass MOM’s fit-and-proper assessment. This means being free from convictions involving dishonesty, human trafficking or serious offences under the Penal Code or the Employment Agencies Act, and not having been a director or manager of an EA whose licence was previously revoked.
The KAH must also hold the relevant Certificate of Employment Intermediaries (CEI) before the application is processed. MOM will not approve a KAH who has not yet passed the examination. The CEI (KAH) course for a Comprehensive agency runs for around 40 hours, while the Select course is shorter, and both end with a written examination. Agency employees who deal with clients and job seekers must separately hold the CEI (Personnel) certification.
Step-by-Step: Applying for an EA Licence
1. Incorporate and Set Up the Business
Register a Singapore business entity, usually a private limited company, and ensure your business activities (SSIC codes) reflect employment agency work. If you are still deciding on a structure, our guide on converting a sole proprietorship to a Pte Ltd explains why most agencies choose the company form for liability protection.
2. Appoint and Certify the Key Appointment Holder
Nominate your KAH and ensure they sit and pass the correct CEI examination for the licence class you want. Register your CorpPass so that authorised staff can transact with MOM; see our CorpPass setup guide for the steps.
3. Arrange the Security Deposit
Obtain a banker’s guarantee of S$20,000 (Select) or S$60,000 (Comprehensive) from an approved bank in the format MOM prescribes.
4. Submit the Application to MOM
Apply online through MOM’s EA licensing system, uploading your business registration details, KAH particulars, CEI certificate, banker’s guarantee and the applicable fee. MOM assesses the application, and once approved, your agency is listed in the public EA Directory.
Ongoing Compliance After Licensing
A licence is only the beginning. Licensed agencies must display licence details, cap the fees they charge job seekers, keep proper records, and comply with the EA advertising and conduct rules. Agencies placing foreign workers must also understand the wider manpower framework, including the Foreign Worker Levy, the Work Permit and S Pass regimes, and the Fair Consideration Framework that governs how roles must be advertised before hiring foreigners. Renewals are annual, and MOM tracks each agency’s demerit points and outcomes, so sustained compliance protects your licence.
For a practitioner walkthrough of the licensing process and the CEI pathway, our friendly resource at Singapore Employment Agency is a useful companion reference.
Penalties and Common Mistakes to Avoid
The consequences of getting EA licensing wrong are serious. Carrying on employment agency work without a valid licence can attract a fine of up to S$80,000, imprisonment of up to two years, or both, and MOM actively enforces the regime. Even licensed agencies can lose their licence: MOM operates a demerit points system, and agencies that mistreat workers, overcharge fees, or breach advertising rules risk suspension or revocation.
Common mistakes include starting to place candidates before the licence is granted, appointing a Key Appointment Holder who has not yet passed the correct Certificate of Employment Intermediaries examination, charging job seekers more than the legal fee cap, and failing to keep proper records of placements and fees. Another frequent error is choosing the wrong licence class, for example applying for a Select Licence and then trying to place foreign domestic workers, which requires a Comprehensive Licence. Planning the structure correctly from the outset avoids a rejected application and a wasted deposit.
How Raffles Corporate Services Can Help
Setting up a compliant employment agency touches incorporation, CorpPass, MOM licensing and ongoing manpower compliance. Raffles Corporate Services helps founders incorporate the right entity, structure directorships and appointments, and coordinate the licensing groundwork so your agency can start trading with confidence. Talk to us before you apply, and we will map out the fastest compliant route for your business.
The Editorial Team, Raffles Corporate Services