Employers of Record (EORs) in Singapore: Everything you need to know

When growing and expanding your business, you want to be able to hire the best talent for each new role, and do so in a way that's manageable and sustainable given your infrastructure, budget, and experience. Now that businesses across the world have embraced remote work, seen its numerous benefits, and verified its efficacy, expanding a business's scope to an international scale is not just possible, but also an attractive option for many.

For businesses looking to tap into the Asia Pacific market, a popular choice is to start operating in Singapore. Comparable in size and population to New York City, this island city-state offers a slew of benefits to burgeoning companies, from comparatively low employer taxes to a growing, diverse, and highly skilled workforce.

However, hiring in Singapore does pose some challenges, especially if your organization isn't yet equipped to handle the myriad complexities of international hires, including country-specific documentation, onboarding, compliance, payroll, and benefits. For many companies, working with an employer of record (EOR) in Singapore is the natural choice, especially if it's your first time hiring abroad or you're just new to hiring in Singapore. Let's take a look at what you need to know about using EOR services in Singapore.

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What is an employer of record?

An employer of record is an entity that serves as the legal employer for workers on behalf of another company, handling all employment responsibilities including payroll, benefits, and compliance. This arrangement lets businesses access global talent without establishing their own legal entities abroad.

Here's why this matters: when hiring internationally, each country has different employment laws, tax requirements, and compliance rules that most companies aren't equipped to navigate alone.

What are the benefits of using an employer of record?

Without an EOR, hiring internationally means you'll need to handle several complex requirements yourself:

• Legal infrastructure: Establish a legal entity, open local bank accounts, and build a legal team
• Compliance management: Navigate employment laws, tax regulations, and intellectual property requirements
• Time and cost: Setting up a new entity can take months or years and requires significant financial investment

Using an EOR means there's no need to go through this complex process. The EOR acts as the legal employer on your behalf and handles all the above details. This speeds up the hiring process, ensures compliance with local laws, and simplifies payroll and benefits administration.

EOR vs. Setting Up a Legal Entity in Singapore

So, you're ready to hire in Singapore—but should you use an EOR or set up your own legal entity? The answer depends on your timeline, budget, and long-term plans.

Using an EOR is ideal if you need to:

• Move quickly and hire talent in days, not months.
• Test the Singaporean market before making a large financial commitment.
• Minimize administrative burden and avoid navigating complex local laws.
• Ensure compliance is handled by local experts from day one.

Setting up a legal entity may be a better fit if you plan to:

• Hire a large team of employees in Singapore.
• Make a significant, long-term investment in the region.
• Have direct employment contracts with your team members under your own company name.

For most companies starting their global expansion, an EOR provides the fastest, most compliant path to hiring in Singapore without the upfront cost and complexity of entity establishment.

Employment Law and Compliance in Singapore

Navigating Singapore's employment landscape requires understanding its core legal framework, primarily governed by the Employment Act and overseen by the Ministry of Manpower (MOM). An EOR helps you stay compliant with these regulations.

Key areas include:

• Employment Contracts: Employers are required to issue Key Employment Terms (KETs) in writing to all employees covered under the Employment Act. This includes details like job responsibilities, salary, working hours, and leave entitlements.
• Probationary Periods: While not mandated by law, probation periods are common practice and are typically set for three to six months. Terms must be clearly stated in the employment contract.
• Termination: Notice periods for termination are based on the length of service and must be specified in the contract. Terminating an employee without just cause can lead to legal challenges, making it critical to follow proper procedures.

Taxes and Payroll Requirements in Singapore

Managing payroll in Singapore involves more than just paying a salary. Employers have specific statutory obligations that an EOR handles on your behalf.

Employer Contributions:

• Central Provident Fund (CPF): For Singaporean citizens and Permanent Residents, employers must contribute a percentage of the employee's salary to their CPF account. Contribution rates vary based on the employee's age and wage.
• Skills Development Levy (SDL): Employers are required to pay a monthly SDL for all employees. These funds are used to support workforce upgrading and training programs.

An EOR calculates these contributions, makes the necessary payments to government agencies, and ensures your payroll is fully compliant every month.

How EOR Hiring Works in Singapore

Worried that hiring internationally means months of paperwork and legal hurdles? Here's the good news: with an EOR, you can onboard Singapore talent in days, not months. Here's exactly how it works:

1. Define the Role: You provide the job details and salary, and our platform helps you benchmark it against local market rates to create a competitive offer.
2. Generate a Compliant Contract: Oyster generates a locally compliant employment agreement that includes all mandatory Key Employment Terms (KETs), ready for your new hire to sign.
3. Onboard Your Team Member: The employee self-onboards through the Oyster platform, providing all necessary information for payroll and benefits enrollment.
4. Manage Employment with Confidence: Oyster handles all ongoing payroll, taxes, benefits, and compliance, so you can focus on integrating your new team member and growing your business.

A few things to know about hiring in Singapore

Before onboarding remote talent from Singapore, it's crucial to familiarize yourself with the employment landscape so you know what to expect. This allows you to make your position attractive to top talent and ensures you'll get the right caliber of people applying to work with your team. Here are a few things to know before you start hiring in Singapore.

Demographics

Singapore offers access to one of the world's most diverse and skilled workforces. Key advantages include:

• Multilingual talent: Four official languages (Chinese, English, Malay, and Tamil) mean greater business flexibility
• High education levels: The workforce is both highly educated and skilled
• Market size: Population of around 6.5 million people provides substantial talent pool

Payment requirements and expectations

Singapore's national currency is the Singapore dollar, or SGD. Unlike some countries, Singapore does not have a statutory minimum wage. Instead, wages are typically determined through negotiation between employers and employees, or by industry-specific agreements.

The standard workweek in Singapore runs from Monday through Friday. An employee should not be obligated to work: (a) for more than 6 consecutive hours without a break for leisure; and
(b) for more than 8 hours in a single day, or exceed 44 hours in any given week.

Employers are required to pay wages on a monthly basis, and, while it's not legally required, many employers offer 13th and 14th month payments. These are lump sum payments representing a month's wages that are paid out in addition to the year's salary, usually at the end of the year. Likewise, periodic bonuses aren't required, but are often expected in competitive employment offers.

If you want to understand the cost of employing someone there, check out our free Singapore employment cost calculator for a detailed breakdown of the hiring costs.

Leave

Employees in Singapore are generally entitled to 11 national holidays a year, and many employers offer additional company holidays or floating holidays.

Singapore's leave policies are structured around length of service. Here's what you need to know:

Many employers offer the maximum annual leave from day one to remain competitive in Singapore's talent market.

To learn more about Singaporean employment regulations and best practices, check out our complete guide to hiring employees in Singapore.

Building Your Singapore Team with Confidence

Hiring in Singapore opens the door to a world-class talent pool in a key APAC hub. While the legal and administrative requirements can seem daunting, you don't have to navigate them alone. Using an Employer of Record removes the complexity, mitigates compliance risks, and allows you to onboard top talent in a fraction of the time it would take to set up your own entity.

By partnering with an expert, you can focus on what truly matters: building your team and achieving your business goals. When you're ready to access Singapore's talent without the traditional barriers, you can start hiring globally.

About Oyster

Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.

Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.