Employee Benefits in Singapore: Complete Guide (2025)

Singapore is a hub for all types of businesses, offering a very business friendly environment, access to a global workforce, and a pleasant environment for employees who may relocate there.

Before your business starts employing anyone in Singapore, you’ll need to know more about employee benefits in Singapore and how they usually work. This guide has you covered. Plus, while you’re planning your new enterprise in Singapore, check out BatchTransfer for low cost ways to manage your payroll overseas, with SGD, USD and other global currencies all supported in one smart business account.

Table of contents

Singapore’s Employment Act Employee vs. Contractor in Singapore Mandatory benefits in Singapore 1. Central Provident Fund 2. Leave Types 3. Employee Termination and Severance Non-Mandatory Employee Benefits in Singapore 1. Health insurance and life insurance 2. Per diem 3. Flexible working 4. Hardware 5. Career Development 6. Additional vacation 7. Stock options Bonus Relocation package and visa sponsorship

Singapore’s Employment Act

Singapore’s workforce includes a mix of local, permanent resident (PR) and expat candidates, and the benefit rules which apply can vary widely depending on the individual’s status and situation. The primary legislation which governs working conditions in Singapore is the Employment Act¹, which offers guidance for employing most local, PR and foreign workers. However, this act doesn’t cover everyone - some people, including domestic workers, civil servants and board members, may not be included².

You’ll need to identify if an individual is considered an employee or a contractor in Singapore before you start working together - this can also impact the benefits you are obliged to offer. We’ll look at this, and the selection of common mandatory and optional employee benefits in Singapore in this article.

This guide is intended for information only. Managing employee benefits - particularly in a different country - can be complex, and can have financial and legal consequences if you get it wrong. Take professional advice if you’re ever unsure about your obligations.

Employee vs. Contractor in Singapore

Employees and contractors have different treatment when it comes to employment rights in Singapore, as in most countries. A contractor is not covered by the Employment Act, which means that many benefits do not apply to them³. One of the most important aspects is that contractors are not usually paid CPF - the Singapore pension and social security contribution scheme.

You must be very sure if anyone working for you is considered to be an employee or a contractor before you enter into an arrangement, as the costs and obligations can be quite different. Get local professional advice if you’re unsure.

Mandatory benefits in Singapore

Let’s start with a look at the key mandatory benefits in Singapore. It’s important to note that some benefits do not apply to expat candidates, and are only applicable to Singapore citizens and PRs. We’ve covered the key points here, but you’ll still need to take local advice to make sure you understand the costs and your obligations based on the types of candidates you plan to recruit in Singapore.

1. Central Provident Fund

The Central Provident fund - CPF - acts as a pension and long term savings vehicle for Singapore citizens and permanent residents. The employer must make mandatory contributions for all citizen and PR employees, and can apply to higher paid workers to reclaim a part of these payments known as the employee contributions⁴. The CPF is not open to expat candidates.

Contributions to the CPF total 37% for most workers, made up of a mandatory 17% employer contribution and a 20% employee contribution which may have to be covered by the employer for lower paid workers⁵. The funds paid into the CPF can then be used by the employee for retirement, healthcare and housing, according to strict guidelines.

Funds are split into different pots, which can be accessed at different stages of life, to ensure everyone can access the money they need. CPF accounts split into:

• Ordinary account - used for spending on retirement and housing
• Special account - used for retirement
• MediSave account- used for healthcare

2. Leave Types

While the minimum available leave in Singapore is fairly low on a global scale, many employers choose to offer increased benefits to compete in an international market.

The Ministry of Manpower (MOM) mandates annual leave which starts at 7 days a year for workers in their first year, running to 14 days a year for employees with 8 years or more of service⁶.

There’s also MOM mandated sick leave which includes up to 14 days for outpatient care and 60 days if you need to stay in hospital⁷. There are rules here again, which require you to get a medical certificate within a short space of time, to allow this payment to be made.

Other leave which is mandatory in Singapore includes MOM required maternity leave of 12 to 16 weeks⁸, depending on whether the child is a Singapore citizen or not. Similarly, there are also options for government paid paternity leave of up to 4 weeks, although some eligibility criteria apply here too⁹.

It’s also helpful to know that you can not employ anyone in Singapore for more than 44 hours a week, or 8 hours a day. If you require your employee to work above their maximum hours, overtime rates apply which are usually at least 1.5 times their normal hourly rate.

3. Employee Termination and Severance

If you need to lay off a team member - known in Singapore as retrenchment - there are some MOM rules to know about¹⁰. Usually redundancy and severance pay is agreed in the employment contract or through a union negotiation in the case of a unionised workforce. If there is no agreement in place the payment can be negotiated directly between the employer and the employee.

Government support is in place to help make sure that employees being retrenched can be supported to retrain if needed, and to access help in finding new roles. If you plan on running a redundancy or change management program you may need to inform MOM in advance to ensure all available support is deployed.

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Non-Mandatory Employee Benefits in Singapore

Singapore attracts a huge number of expats who come to work in this global business and finance hub. While some of the mandatory benefits set out in law don’t apply to expat workers, businesses can still choose to add in additional benefits which can be offered to foreign and local workers alike. This is a common approach to make sure you can recruit the best talent from all over the world.

It’s worth noting that the cost of living in Singapore is pretty high, and so prospective employees are likely to be looking for a fairly generous compensation and benefits package covering basic salary and extras like bonus or stock options. Because healthcare is expensive for foreigners, health cover and insurance is also a common expectation.

1. Health insurance and life insurance

Foreigners in Singapore can’t usually access government healthcare, and so offering a health insurance policy is common as part of a benefits package. For some visa types, this may be mandatory. Private health insurance can also be an attractive benefit for local employees as it increases the choice of provider when treatment is needed.

The level of health benefit offered can vary a lot, from fairly basic policies to all inclusive options with little to no excess to pay, and a good range of providers to choose from.

Life insurance, which may include paying out a fixed sum in the event of an employee's death, is also a common option. Some employers may offer this alongside long term disability insurance which offers benefits if you end up unable to work through disability, injury or illness.

2. Per diem

A per diem allowance is a fixed amount paid to employees when they have to undertake work travel. Many people working in Singapore do so because it is a global and regional hub, and are required to travel a lot for their work. Here a per diem payment can be an attractive benefit to cover incidental and day to day costs associated with being away from home.

3. Flexible working

Offering flexible working, including a mix of office hours and work from home arrangements can be attractive to employees. Again, as people are commonly in Singapore to work with customers and teams in other areas of the world, working hours can be antisocial to fit into the required time zones. Allowing for flexibility of hours and location is a good way to balance this while still getting the service you require from your team.

Flexible working can be offered at little to no cost to the employer, but can be very valuable to the employee. It’s also a good way to show you trust your employees to complete the work required of them in the way that works best for them and your customer base. Many Singapore businesses run home working or hybrid schemes so employees can benefit from reduced travel times and costs.

4. Hardware

If you’re expecting employees to use specific equipment or to take calls, you’ll usually need to provide a phone, laptop and any other required devices as part of their terms of service. If your team works remotely you may choose to support them to set up home offices, or pay monthly fees for a coworking space for example, as well as buying hardware for them.

5. Career Development

Businesses all over the world offer additional training and career development opportunities to entice the best people into their organization. This is extremely common in Singapore and can involve paying for training, supporting the membership of professional bodies, taking part in networking and industry events, or allowing employees to take paid leave to study for work-related qualifications for example.

As a global business hub, Singapore offers a very large range of options for career and professional development. If you are employing Singapore citizens and PRs you may also find that they’re eligible for reduced fees for training which makes it easier to build this option into your business plan.

6. Additional vacation

Singapore's mandatory leave policies are pretty unattractive to incoming expats from some countries. With a starting mandatory leave of just 7 days a year, candidates from Europe and other regions where 4 weeks or more is a standard for paid time off may look for additional vacation and paid time off as part of their packages.

If you’re unable to offer additional vacation, you may also choose to consider flexible working policies which allow expat team members to work from their home country for some weeks a year. You’ll need to take tax advice to ensure this does not cause issues in either Singapore or the individual’s home country, but with so many opportunities for remote working these days, this can be a valuable benefit where it’s feasible.

7. Stock options

For startups and tech companies, stock options can be a good way to structure employee compensation in a way that works for the individuals and the business alike. By offering stock for future sale you ensure your employees have ‘skin in the game’ and can take on the costs of this at a later stage when your business is more developed.

Bonus

Bonus payments are pretty standard in Singapore, although the way bonus schemes work can vary widely. Bonus schemes should be set out in writing and can be paid based on employee performance or behaviors, business performance, tenure or other measures.

Relocation package and visa sponsorship

If you’re planning on employing people in Singapore who need to relocate to the country you will often need to offer support with relocation and visas. Many Singapore employment visas require employer sponsorship, which may mean this is a necessity to be able to attract the candidates you need. Aside from having a visa, the practicalities of managing an overseas move mean relocation support and allowances are attractive, and even expected by higher level employees moving to another country.

Employing individuals and using contractors in Singapore can be a great way to reach a broad range of timezones, with a highly skilled local and international workforce and very business friendly policies in place. To make sure you’re offering a competitive salary and benefits package you’ll need to understand the local market and the mandatory benefits which are expected and required. This guide gives you an outline, and there are also lots of local agents in Singapore which can help you build out the best employee benefits package in Singapore for your unique needs.

Good luck - and don’t forget to also check out BatchTransfer for low cost ways to manage your business finances in Singapore and beyond.

Country Articles	Learn More About Employee Benefits
Australia	Employee Benefits in Australia: A Complete Guide
Singapore	Employee Benefits in Singapore: A Complete Guide
UK	Employee Benefits in UK: A Complete Guide
Brazil	Employee Benefits in Brazil: A Complete Guide
South Africa	Employee Benefits in South Africa: A Complete Guide
Spain	Employee Benefits in Spain: A Complete Guide

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Sources:

1. Singapore Employment Act
2. Singapore Government - who is covered by the Employment Act
3. Singapore Government - contract of service
4. MOM - workplace rights
5. CPF - contribution rates
6. MOM - annual leave
7. MOM - sick leave
8. MOM - maternity leave
9. Singapore government - paternity leave
10. MOM - responsible retrenchment