Key legislation and regulations under the EAA, EAR & EALCs related to operating an Employment Agency
Definitions
EAA - Employment Agencies Act
EAR - Employment Agencies Rules
EALC - Employment Agency Licence Conditions
Sections marked with # will be tested in the CEI exam.
Offence to bring foreigner into Singapore without In-Principle Approval#
Section 10(1) of Employment Agencies Rules
An Employment Agency is not allowed to bring in nor facilitate the entry of a foreigner into Singapore to seek employment unless foreigner has an In-Principle Approval issued by the Controller of Work Pass under an Employer.
Penalty:
- First conviction: Fine not exceeding $5,000
- Second conviction: Fine not exceeding $5,000 or/and imprisonment for a term not exceeding 6 months
Offence to retain passport or other documents of identity#
Section 10(2) of Employment Agencies Rules
Such documents are personal identifiers that belong to the foreign employee. Do not retain a foreign employee’s passport beyond the timeframe that you require it to facilitate placement of the foreign employee, extend the validity of the passport or perform other official work.
Return the foreign employee’s passport to him or her directly as soon as practicable, for example once the work pass card has been collected. It is not a reasonable excuse for failing to return the passport/ identification documents of a foreign employee if Employment Agency had passed the item to another licensee, employment agency personnel or employment agency (located in Singapore or elsewhere)
Penalty:
- First conviction: Fine not exceeding $5,000
- Second conviction: Fine not exceeding $5,000 or/and imprisonment for a term not exceeding 6 months
Prescribed Fees for Services rendered#
Section 14 of Employment Agencies Act
It is lawful for the licensee to charge and receive fees only in the prescribed manner.
Prescribed Fee as stipulated in section 12(1) of Employment Agencies Rules
To Employer:
- No cap on the fee that Employment Agencies may charge Employers for the services provided
- Employers have stronger bargaining power compared to workers
To Worker:
- No registration fees allowed to be charged
- Fees should not be charged prior to placement (i.e., before In-Principle Approval (IPA) has been issued for foreigners, and before date of signing employment contract for locals)
- Employment Agencies are not allowed to collect any deposit before the placement is done from any applicant
- Fees charged should not be more than one month’s worth of salary per year for the duration of the approved work pass or employment contract, whichever is shorter (i.e. fee cap). These fees include any services conducted by the Employment Agency in Singapore or outside of Singapore, even if the fees are collected from workers via an overseas employment agency (e.g. Singapore Employment Agency provides training in the foreign jobseeker’s home country)
- Fee cap is subject to a maximum of 2 months’ work of salary[1]. Salary is defined as basic salary plus fixed allowance
- Certain fees should not be collected from workers as they should be borne by prospective Employers or Employment Agencies themselves, e.g. fees incurred in Singapore such as costs of training[2], medical check-ups
[1]Based on a 2-year contract. 1 year of work = 1 month's salary chargeable for placement fee
[2]Examples of Training: Settling-in Programme (SIP) for new Foreign Domestic Workers (FDWs) and Work Permit holders, Safety Orientation Course for construction workers