Part of a comprehensive analysis of the Employment Act 1968
All Parts in This Series
- PART 1
- PART 2 (this article)
- PART 3
- PART 4
- PART 5
- PART 6
- PART 6
- PART 7
- PART 8
- PART 9
- PART 10
- PART 12
- PART 13
- PART 14
- PART 15
- PART 15
- PART 16
- PART 1
- PART 3
- PART 4
- PART 5
- PART 6
- PART 7
Key Provisions Governing Contracts of Service under the Employment Act 1968
The Employment Act 1968 establishes a comprehensive legal framework to regulate contracts of service between employers and employees in Singapore. This framework ensures fair employment conditions, protects employee rights, and provides clear mechanisms for contract termination, dismissal, and transfer of employment. The key provisions in this Part of the Act serve distinct purposes, each designed to uphold the balance of power in the employment relationship and promote industrial harmony.
"Every term of a contract of service which provides a condition of service which is less favourable to an employee than any of the conditions of service prescribed by this Act is illegal and void to the extent that it is so less favourable." — Section 8, Employment Act 1968
Verify Section 8 in source document →
Purpose: Section 8 exists to prevent employers from imposing contractual terms that undermine the minimum standards set by the Act. This provision protects employees from exploitation by ensuring that statutory conditions are the baseline for all contracts of service.
"A contract of service for a specified piece of work or for a specified period of time... terminates when the work specified in the contract is completed or the period of time for which the contract was made has expired." — Section 9, Employment Act 1968
Verify Section 9 in source document →
Purpose: Section 9 clarifies the nature of contracts for specified and unspecified periods, providing certainty on when such contracts end. This is essential to avoid disputes regarding contract duration and termination.
"Either party to a contract of service may at any time give to the other party notice of the firstmentioned party’s intention to terminate the contract of service." — Section 10, Employment Act 1968
Verify Section 10 in source document →
Purpose: Section 10 sets out the notice requirements for terminating contracts, ensuring that both employers and employees have a clear, fair process to end the employment relationship. This protects both parties from abrupt termination without reasonable notice.
"Either party to a contract of service may terminate the contract of service without notice... by paying to the other party a sum equal to the amount of salary at the gross rate of pay which would have accrued to the employee during the period of the notice." — Section 11, Employment Act 1968
Verify Section 11 in source document →
Purpose: Section 11 allows termination without notice if payment in lieu of notice is made. This provision provides flexibility while safeguarding the financial interests of the party entitled to notice.
"Despite any other written law, a person below 18 years of age is, subject to the provisions of this Act, competent to enter into a contract of service." — Section 12, Employment Act 1968
Verify Section 12 in source document →
Purpose: Section 12 affirms the legal capacity of minors to enter into contracts of service, subject to safeguards. This ensures young workers are protected while recognising their ability to work legally.
"An employer is deemed to have broken the employer’s contract of service with the employee if the employer fails to pay salary in accordance with Part 3." — Section 13, Employment Act 1968
Verify Section 13 in source document →
Purpose: Section 13 protects employees by deeming non-payment of salary as a breach of contract by the employer. This provision enforces timely salary payments as a fundamental contractual obligation.
"An employer may after due inquiry dismiss without notice an employee employed by the employer on the grounds of misconduct inconsistent with the fulfilment of the express or implied conditions of the employee’s service..." — Section 14, Employment Act 1968
Verify Section 14 in source document →
Purpose: Section 14 regulates dismissal procedures, allowing summary dismissal for serious misconduct while providing remedies for unfair dismissal. This balances employer authority with employee protection.
"An employee may terminate his or her contract of service with his or her employer without notice where the employee or the employee’s dependant is immediately threatened by danger..." — Section 15, Employment Act 1968
Verify Section 15 in source document →
Purpose: Section 15 empowers employees to terminate contracts without notice in emergency situations, safeguarding their personal safety and that of their dependants.
"Subject to anything in the contract of service to the contrary, the party who breaks the contract of service is liable to pay to the other party a sum equal to the amount the firstmentioned party would have been liable to pay under section 11..." — Section 16, Employment Act 1968
Verify Section 16 in source document →
Purpose: Section 16 imposes liability for breach of contract, ensuring that the party at fault compensates the other party appropriately. This provision enforces contractual discipline and fairness.
"Nothing in any contract of service restricts, in any way, the right of any employee who is a party to such contract to join a registered trade union..." — Section 17, Employment Act 1968
Verify Section 17 in source document →
Purpose: Section 17 protects employees’ rights to join and participate in trade unions, promoting collective bargaining and industrial democracy.
"If by or under any written law a contract of employment between any body corporate and an employee is modified and some other body corporate is substituted as the employer... the change of employer does not break the continuity of the period of employment." — Section 18, Employment Act 1968
Verify Section 18 in source document →
Purpose: Section 18 preserves employment continuity when there is a change of employer, protecting employees’ accrued rights and benefits.
"If an undertaking... is transferred from one person to another such transfer does not operate to terminate the contract of service..." — Section 18A, Employment Act 1968
Verify Section 18A in source document →
Purpose: Section 18A ensures that employment contracts remain intact during business transfers, safeguarding employees from unfair termination due to corporate restructuring.
"Any employer who enters into a contract of service or collective agreement contrary to the provisions of this Part shall be guilty of an offence." — Section 19, Employment Act 1968
Verify Section 19 in source document →
Purpose: Section 19 enforces compliance by penalising employers who contravene the statutory provisions, thereby upholding the integrity of employment law.
Definitions Critical to Understanding Employment Contract Provisions
The Act provides precise definitions to ensure clarity and avoid ambiguity in the application of its provisions, particularly concerning employment transfers and trade union recognition.
"In this section — 'affected employee' means any employee of the transferor who may be affected by a transfer under subsection (1) or may be affected by the measures taken in connection with such a transfer; 'trade union' means a trade union which has been (a) registered under any written law for the time being in force relating to the registration of trade unions; and (b) accorded recognition by the employer pursuant to section 17(1) of the Industrial Relations Act 1960; 'transfer' includes the disposition of a business as a going concern and a transfer effected by sale, amalgamation, merger, reconstruction or operation of law; 'undertaking' includes any trade or business." — Section 18A(13), Employment Act 1968
Purpose: These definitions clarify the scope of terms used in transfer-related provisions, ensuring that employee rights are preserved during business changes and that trade union status is clearly understood in the context of industrial relations.
Penalties for Non-Compliance with Contractual Provisions
The Act imposes strict penalties on employers who fail to comply with its provisions, reinforcing the importance of adherence to statutory employment standards.
"Any employer who enters into a contract of service or collective agreement contrary to the provisions of this Part shall be guilty of an offence." — Section 19, Employment Act 1968
Verify Section 19 in source document →
Purpose: This penalty provision deters employers from circumventing the law by entering into illegal contracts or agreements, thereby protecting employees and maintaining lawful employment practices.
Cross-References to Other Relevant Legislation
The Employment Act 1968 integrates with other statutes to provide a cohesive legal framework governing employment relations, dispute resolution, and trade union activities.
"Despite subsection (1), but subject to section 3 of the Employment Claims Act 2016, where a relevant employee considers that he or she has been dismissed without just cause or excuse by his or her employer, the employee may lodge a claim, under section 13 of that Act..." — Section 14(2), Employment Act 1968
Verify Section 14 in source document →
Purpose: This cross-reference links dismissal procedures under the Employment Act with the Employment Claims Act 2016, providing employees with a statutory avenue to seek redress for unfair dismissal.
"To associate with any other persons for the purpose of organising a trade union in accordance with the provisions of the Trade Unions Act 1940." — Section 17(c), Employment Act 1968
Verify Section 17 in source document →
Purpose: This provision affirms employees’ rights to organise under the Trade Unions Act 1940, reinforcing protections for collective labour rights.
"Where, immediately before a transfer referred to in subsection (1), a trade union is recognised by the transferor for the purposes of the Industrial Relations Act 1960..." — Section 18A(8), Employment Act 1968
Verify Section 18A in source document →
Purpose: This ensures continuity of trade union recognition during business transfers, preserving collective bargaining arrangements.
"'Trade union' means a trade union which has been... accorded recognition by the employer pursuant to section 17(1) of the Industrial Relations Act 1960;" — Section 18A(13)(b), Employment Act 1968
Verify Section 18A in source document →
Purpose: This definition ties trade union recognition to the Industrial Relations Act 1960, ensuring consistency in legal interpretation across statutes.
"A dispute or disagreement... may be referred by a party to the dispute or disagreement to the Commissioner under section 115 and is deemed to be a dispute to which that section applies." — Section 18A(9), Employment Act 1968
Verify Section 18A in source document →
Purpose: This provision facilitates dispute resolution through the Commissioner, integrating the Employment Act with established industrial relations mechanisms.
Conclusion
The Employment Act 1968’s provisions on contracts of service are designed to create a fair and balanced employment environment. By prescribing minimum conditions, regulating contract termination, protecting employee rights to unionise, and ensuring continuity of employment during business transfers, the Act safeguards both employees and employers. The penalties for non-compliance and cross-references to other legislation further strengthen the enforcement and coherence of employment law in Singapore.
Sections Covered in This Analysis
- Section 8
- Section 9
- Section 10
- Section 11
- Section 12
- Section 13
- Section 14
- Section 15
- Section 16
- Section 17
- Section 18
- Section 18A
- Section 19
Source Documents
For the authoritative text, consult SSO.