More clarity on leave benefits and notice period for term contract employees

New guidelines by the tripartite partners may allow more term contract employees to be eligible for leave benefits such as annual leave, sick leave and maternity leave.
New guidelines by the tripartite partners may allow more term contract employees to be eligible for leave benefits such as annual leave, sick leave and maternity leave.PHOTO: ST FILE

SINGAPORE - New guidelines by the tripartite partners may allow more term contract employees to be eligible for leave benefits such as annual leave, sick leave and maternity leave.

The guidelines aim to clarify the granting of leave benefits to term contract employees with a long-term working relationship, as well as the notice period that employers should give before contract expiry.

This was announced on Monday (June 20) by the tripartite partners: the Ministry of Manpower (MOM), National Trades Union Congress (NTUC) and the Singapore National Employers Federation (SNEF).

Currently, employees on term contracts are entitled to statutory leave benefits under the Employment Act and the Child Development Co-Savings Act if they meet a minimum service period of three continuous months. Such leave benefits include annual leave, sick leave, maternity leave, childcare and extended childcare leave.

But some term contract employees who have been working for the same employer for a long time do not get such benefits.

This happens if they are on separate contracts that are each shorter than three months, and renewed with a break between the contracts.

Term contract employees form around 11 per cent of the resident workforce, or about 202,400 people, according to MOM's Labour Force Report last year.

In the new guidelines, employers are encouraged to treat contracts renewed within a month as continuous, and grant leave benefits based on the cumulative term of contracts. This applies to contracts of 14 days or more.

Employers could pro-rate annual leave, sick leave and childcare leave benefits based on the length of the term contract, said the guidelines.

Both employers and employees should give "sufficient notice" before the contract's expiry on whether it should be renewed as well. This applies for work arrangements where contracts are renewed multiple times.

This should be "the same as the notice period required for early contract termination", or not less than a day's notice if cumulative employment is less than 26 weeks, according to the guidelines.

"Employers value these workers for the flexibility and contributions to their short term business requirements," said Mr Koh Juan Kiat, SNEF's executive director, who added that the guidelines will allow employers to offer contracts that better attract such workers.

"SNEF encourages employers to also take a longer term view of their manpower needs and create opportunities to retain such workers," he said.

Said NTUC assistant secretary-general Zainal Sapari: "The labour movement will work closely with our family of unions, associates, partners, social enterprises and related organisations, to ensure that employment practices are aligned with the guidelines."