AGS Worldwide Movers

The real-world impact of Singapore’s new COMPASS legislation – a corporate view

To further enhance its position as a global business hub and ensure a fair workplace for all, the Singapore government has recently introduced the Comprehensive Labour and Fair Employment Practices (COMPASS) legislation. The question is, how has the new law gone down with multinational employers?

Posted in: AGS Relocation news
Published Date: 24 January 2024

Amazing view of Marina Bay, Singapore

Understanding Singapore’s COMPASS Legislation

COMPASS aims to promote fair employment practices, improve working conditions, and foster equal opportunities for all Singaporean employees. It encompasses a range of measures and guidelines designed to address workplace discrimination, excessive work arrangements, and unfair employment practices.

It also includes a points-based system that helps employers assess international candidates’ eligibility for Singapore’s Employment Pass – a work visa for those in high-salaried sectors, namely Professionals, Managers, Executives, and Technicians (PMET).


Implications for Employers

The benefits of having a diverse team

Enhanced Recruitment Practices

The COMPASS legislation encourages employers to adopt transparent and fair recruitment practices, eliminating any form of discrimination. Employers must review their hiring processes to ensure they align with the legislation’s non-discriminatory guidelines regarding age, gender, race, religion, nationality, and disability.


Redefined Salary Practices

To promote salary transparency, employers are required to disclose salary ranges for positions during recruitment. This increased transparency is meant to ensure equal opportunities and fairness in remuneration packages, fostering trust and attracting diverse talent.


Stronger Workplace Wellbeing Focus

The legislation emphasises the importance of work-life balance and employee well-being. Employers must take steps to provide adequate support and resources to employees, promoting mental and physical health wellness initiatives. Flexible work arrangements and reasonable workload management become vital to ensuring a healthy and productive workforce.


Strengthened Fair Employment Practices

Unfair employment practices, such as discrimination in career progression or unequal wage treatment, are addressed directly by the COMPASS legislation. Employers must actively assess and address any potential barriers that hinder equal opportunities within their organisations and provide clear pathways for career advancement.


Compliance and Reporting Obligations

With the implementation of the COMPASS legislation, businesses are required to report their diversity data and comply with the fair employment requirements. Employers must monitor and review their practices consistently, keeping accurate records, and conducting audits to demonstrate their commitment to fair employment practices.


The corporate perspective

Corporate viewpoint on Singapore's COMPASS legislation
On the face of it, the Singapore’s COMPASS legislation is an important step in fostering fair employment practices and creating a conducive work environment. It takes Singaporean law closer to some of the laws we see in the EU.

The view of large international employers in Singapore is that this legislation, while positive from an employee perspective, is likely to make Singapore less competitive as a location for employers looking to set up APAC headquarters – especially when it comes to the nationality percentage criteria, where no foreign nationality can account for more than 25% of employees.

Considering the melting pot nature of the Singaporean labour market, and the large number of foreign national workers, this could be particularly problematic for employers looking to bring executives to Singapore.

All things taken into consideration this is a positive step from the Singaporean government from an employee point of view, but undoubtably a change that will make employment and immigration more difficult from the employer perspective.

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