5 Things You Need To Know About Allowing Your Employees To Take A Second Job

Against the backdrop of COVID-19, Singapore’s GDP has been significantly impacted. The latest forecast from the Ministry of Trade and Industry (MTI) points to an economic contraction of -5% to -7% – our worst since independence.

The jobs market has consequently taken a hit. 11,350 workers have been retrenched in the first half of 2020, with a further 85,910 employees placed on fewer hours or temporary layoffs.

This statistic does not take into consideration employees who have had to take pay cuts to keep their jobs either. 

Read Also: 5 Singapore Job Statistics We Learned From The Ministry Of Manpower (MOM) 1H2020 Labour Market Report

Supporting Employees To Take Up A Second (Part-Time) Job

Earlier in the year, the National Wages Council (NWC), made up of members from the tripartite body – the Singapore National Employers Federation (SNEF), National Trades Union Congress (NTUC) and MOM – encouraged employers to support their employees who are interested to take on a second job elsewhere to cope with a reduced monthly salary.

Read Also: Guide To Understanding  The Role Of Singapore National Employers’ Federation (SNEF) And Singapore Business Federation (SBF)

Here are 5 things you need to know about allowing your employees to take a second job.

#1 Employers Are Encouraged By The Government To Allow Employees To Take On A Second Job

In line with the NWC recommendation, the Ministry of Manpower (MOM) posted a guide on second job arrangements for employers on its website. In short, it states that employers cannot stop employees from taking a second job unless there are: 

  • prohibitions in their current employment contract from taking on other forms of work; and/or 
  • there is a conflict of interest with their current employer.

Even if these conditions are present, MOM encourages employers to waive contractual prohibitions against taking on a second job and to help employees and resolve conflicts of interest where possible. This is especially because employers have initiated the reduced work hours and/or reduced salaries to save costs.

It also encouraged employees to ensure they can handle both jobs without compromising the interest of either employer and to be transparent about their work arrangement.

#2 Employers Can Help Their Affected Employees Find A Second Job

As an employer, it can be tough to tell your employees that you are unable to pay their full salary. While this may be painful to you, it can be equally demoralising for employees and even put their livelihoods at risk.

Read Also: Retrenching Some Staff VS Pay Cut For All: Pros And Cons Of Each Cost-Saving Method

What employers can do to help the situation is aid affected employees to find a second job while your company weathers the storm. Employers can either do this through your own contacts or via the Singapore Business Federation (SBF) and Trade Association and Chambers (TACs) to identify private sector outplacement opportunities. You can:

  • Reach out to your TAC or SBF to get a Job Order Template. Fill it up with details of the outplacement and submit to your TAC or SBF.
  • Check the job postings on Workforce Singapore’s MyCareersFuture and direct your employees to apply for jobs.
  • Work with your TAC or SBF to look out for intra-sector and cross-sector job matching opportunities (including company-to-company matching and individual-to-company matching)
  • Report to your TAC or SBF if your outplaced employees are successfully hired by other companies (presumably to help other such companies with their excess manpower).

#3 What The First Employer Needs To Know

First employers continue to be responsible for their employees’ salaries, CPF contributions, and any statutory and contractual benefits, which may be pro-rated due to the reduced work arrangements.

Your employees do not actually need to seek your consent for a second job arrangement unless the employment contract prohibits moonlighting or there is a conflict of interest.

Read Also: Why Singapore’s Largest Employer (The Public Service) Does Not Encourage Moonlighting?

If your employee falls ill on the day they were only working for their second employer, you, as the first employer, do not have to provide sick leave and medical benefits for them. Similarly, if your employee suffers a work injury while working for the second employer, only the second employer is responsible for the workplace injury compensation, and not you.

In a complicated situation where the employee works for both employers during a day he falls ill, both employers are required to provide sick leave and medical benefits, which can be pro-rated, assuming he has worked for both employers for more than 3 months.

Do note that foreign employees are not allowed to work as freelancers.

#4 What The Second Employer Needs To Know

As the second employer, you will typically see employees taking on a second job as a short-term worker in your company. 

Even though the Employment Act states that employees who have worked for 3 months or more are entitled to paid outpatient sick leave and hospitalisation leave, second employers are encouraged to provide employees with sick leave entitlements and medical benefits.

Similarly, second employers are responsible for employees’ salaries, CPF contributions, and any statutory and contractual benefits.

#5 Who Is Responsible For CPF Contributions To An Employee Working In Two Jobs

Whether you are the first or second employer, you must pay CPF contributions to their employees based on the wages payable to them. This is regardless of whether an employee may be earning more than $6,000 a month, because the Ordinary Wage (OW) ceiling is applicable on a “per employment” basis.

If an employee is earning more than $6,000, he may apply to limit the employee’s share of contributions. Note this will not affect the Employer’s CPF contribution, and that employers will also have to pay the worker his employee’s share of CPF contributions.

Read Also: Complete Guide To Employers’ CPF Contributions In Singapore

A Second Job Can Help Employees Gain Valuable Skills 

Employers who are unable to continue paying their employees in the interim, can view their second job as a temporary means to support their livelihoods while your company finds its footing.

The last thing that should be on employers’ minds is to insert a clause to prohibit employees from moonlighting just to circumvent this arrangement currently or in the future.

While working in a second job, employees may also gain broader skills and be more able to contribute to your company – providing a win-win situation. One way to view the second job is that it is usually a temporary situation based on immediate needs in the first place, rather than your employees leaving for another company. 

This point was underscored by Member of Parliament (MP) for Bishan and Toa Payoh GRC Chee Hee Kiong, who is also the CEO of Suntec REIT. He elaborated in Parliament that employees should be allowed to take up two jobs, citing that this will help workers develop a broader skillset.

Need Financing Support During This Period?

From now till 31 March 2021, SMEs can enjoy extra financing support of up to $5 million through the Temporary Bridging Loan Programme.

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