February's MOM Updates: New Contract Rules, Higher Compensation, & Hiring Trends

Posted on 27 February 2024 in Business | Suki Bajaj

Let’s take a look at Singapore’s top HR news, updates and insights for February including new guidelines for restrictive clauses in employment contracts, increase in work-injury related compensation limits, anticipated hiring surge, skills-based hiring trend, and more.

New Guidelines for Restrictive Clauses in Employment Contracts Set For 2024 Release

MOM, along with labour unions and employers, is developing a set of tripartite guidelines for reasonable use of restrictive clauses in employment contracts to ensure fair employment contracts and provide clearer guidance to employers.

These guidelines, targeting a release in the second half of 2024, aim to strike a balance between protecting legitimate business interests and employee rights.

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MOM Enhances Compensation Limits for Work-Related Injuries

MOM announced significant increases to compensation limits under the Work Injury Compensation Act (WICA), effective November 1, 2025.

This aligns with rising wages and healthcare costs, with death and permanent incapacity limits rising 19% to $269,000 and $346,000 respectively, and medical expenses increasing 17% to $53,000.

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Temporary Financial Support Scheme Underway for Laid-off Employees in Singapore

The government is preparing to announce details of a temporary financial support program to assist those facing unemployment due to technological advancements.

This initiative, designed to aid the involuntarily unemployed while they search for new jobs or undergo retraining to equip them for the changing workforce, is being carefully crafted to avoid issues encountered by other countries' unemployment benefit programs.

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More Firms Adopting Standards for Freelance Hires

In Singapore, over 2,600 companies have adopted fair hiring guidelines for freelancers, a significant increase since their introduction in 2018.

To promote further adoption, TAFEP and NTUC will collaborate with industry associations to engage businesses on these recommendations, fostering better compliance and dispute resolution.

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Majority of Singapore Employers Plan to Hire More Staff In 2024

A recent survey found nearly 60% of Singaporean employers plan to hire new staff in 2024, reflecting economic confidence and growth potential.

This hiring surge is driven by filling vacancies, supporting business development, and a need for specialized skills, with smaller companies leading the charge in hiring sprees.

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Most Singapore Workers Approve of New Work Arrangements

Majority of Singaporean employees are satisfied with their work arrangements, with over 72% of employees approving of their current policies - suggesting a positive reception to adjustments made by employers.

While multinational companies are more likely to offer flexible workdays, nearly half of local firms require employees to be fully on-site.

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Many Firms Don't Change Hiring Practices Despite Dropping Degree Requirements

Despite a rise in employers removing degree requirements, a new report reveals only 37% have seen actual hiring changes.

However, at leading firms using Skills-Based Hiring, non-degreed workers have 10% higher retention rates and 25% higher salaries, suggesting that this hiring approach could be beneficial despite its slow adoption.

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