There has been a rising trend of individuals in Singapore taking on side hustles. While side hustles typically entail freelance work, it may also mean taking on a second job.
There’s no law to prevent employees from taking up a side hustle and/or a second job if they are doing it in their spare time. Perhaps, the only constraint may be an ethical one – that they do not share information and/or resources in both jobs, as well as not becoming over-employed and unable to fulfill their duties in one or both jobs.
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 National Wage Council (NWC) recommendations, the Ministry of Manpower (MOM) stated 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. While this may have been in relation to the COVID-19 pandemic, when employees may have suffered a drop in work hours and pay, allowing employees to work more than one job can also uplift lower-wage workers.
Furthermore, MOM explicitly avoids disincentivising businesses from hiring someone who may be holding a second job by allowing locals to count towards the foreign worker quota of up to two companies.
MOM 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.
Read Also: Progressive Wage Model: How Much Will Singapore Employers Have To Pay Their Workers
#2 Employers Can Help Their Affected Employees Find A Second Job
Though we are out of the pandemic, retrenchments and cost-cutting remains a natural part of the working world. In fact, the latest 2Q 2024 MOM Labour Market Advance Release reported that retrenchments have normalised to pre-COVID-19 levels after dipping to a record low in 2022.
By helping employees find an interim or permanent second job, certain employers can still find win-win situations, providing less work for less pay, rather than retrenching their workers. While this may be painful for any employer, it is likely more demoralising for employees and even put their livelihoods at risk.
Employers can either do this through their personal and business 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).
Read Also: Retrenching Some Staff VS Pay Cut For All: Pros And Cons Of Each Cost-Saving Method
#3 What The First Employer Needs To Know
The first employer continues 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.
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 or take on second jobs freely.
Read Also: Who Should Pay For The Medical Leave If Your Employee Work Two Jobs?
#4 What The Second Employer Needs To Know
As the second employer, you may see employees taking on a second job as short-term workers. Perhaps, if this trend becomes more acceptable, it may increasingly apply to longer-term employees at some point.
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 to provide some peace of mind.
Similarly, second employers are responsible for employees’ salaries, CPF contributions, and any statutory and contractual benefits.
Read Also: Medical Benefits That Businesses Have To Legally Provide For Their Employees In Singapore
#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 $6,800 a month, because the Ordinary Wage (OW) ceiling is applicable on a “per employment” basis.
If an employee is earning more than $6,800, 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 need to reduce their overhead or are unable to continue paying their employees either in the interim, can view their second jobs 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.
This article was first published on 23 September 2020 and has been updated with the latest information.
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