How to Hire Employees in Singapore: Employment Act, CPF & EOR Compliance

1. The Singapore Commercial & Employment Advantage

Singapore is the premier regional headquarters hub for the Asia-Pacific region, combining low corporate tax rates, robust intellectual property protection, rule of law, and an exceptionally skilled multinational workforce. Employment relationships are governed by the Employment Act (Chapter 91) administered by the Ministry of Manpower (MOM).

2. Central Provident Fund (CPF) & Statutory Levies

Statutory payroll obligations in Singapore depend strictly on employee residency status:

• Singapore Citizens & Permanent Residents: Employers must contribute 17% of gross monthly wages to the Central Provident Fund (CPF) for employees aged 55 and below, alongside a 20% employee deduction, subject to statutory monthly salary ceilings (S$8,000 in 2026).
• Foreign Employees (Employment Pass / S Pass): Completely exempt from CPF contributions. Employers must instead pay the Skills Development Levy (SDL) of 0.25% (minimum S$2, maximum S$11.25 per employee per month).

See the Singapore EOR Cost & Pricing Guide for employer contributions and total employment cost modeling.

3. Employment Pass (EP) & COMPASS Framework

To hire foreign professional talent, employers must sponsor an Employment Pass through MOM. Applications are evaluated under the Complementarity Assessment Framework (COMPASS), a transparent points-based system evaluating candidate salary, qualifications, company nationality diversity, and local employment support.