Wrongful/Unfair Dismissal Singapore: A Legal Guide For Employees & Employers

Legal Framework Of Employment Termination in Singapore

Singapore’s employment termination laws are primarily governed by the Employment Act (EA) along with individual employment contracts. The EA sets out the legal framework for the termination of employment, applying to all employees except domestic workers, seafarers, and specific categories excluded by the Minister through a Gazette.

Under Singapore law, the terms of an employment contract should not be less favourable than the rights provided under the EA. This includes regulations related to termination, ensuring a fair process for both employer and employee. The EA’s provisions for termination are detailed in sections 9 to 11, highlighting three primary ways in which employment can be terminated:

1. Contractual Termination: Occurs either at the expiry of the employment contract or upon completion of the contract’s specified work.
2. Termination by Written Notice: The required notice length is defined in the employment contract. If unspecified, it defaults to the terms set out in Section 10(3) of the EA.
3. Summary Dismissal or Termination Without Notice: This method, also known as ‘summary dismissal’, is strictly regulated. It applies under specific circumstances, such as a wilful breach of a contract condition or when either party compensates the other for the notice period.

Summary dismissal is particularly sensitive, with legal provisions ensuring it is used fairly and appropriately. The EA outlines that misconduct, including acts like theft, dishonesty, and disorderly behaviour, can justify summary dismissal. However, employers must adhere to high standards of proof and procedural fairness, as stipulated by the courts and the Ministry of Manpower (MOM).

This legal framework provides a structured approach to employment termination, balancing the rights and obligations of employers and employees, and aims to protect employees from unfair dismissal while allowing employers to terminate employment for legitimate reasons.

Provisions Under the Employment Act

The Employment Act (EA) in Singapore serves as the cornerstone of employment law, providing a comprehensive framework that governs the terms and conditions of employment. This includes specific provisions relating to the termination of employment. The key aspects of these provisions are:

• Scope of the Act: The EA applies to all employees working under a contract of service with an employer, except for domestic workers, seafarers, and certain other categories excluded by the Minister.
• Contractual Terms: The Act mandates that employment contracts should not impose conditions less favourable than those stipulated in the EA. This ensures a baseline standard of protection for all employees covered under the Act.
• Notice Periods for Termination: Sections 9-11 of the EA outline the procedures for termination of employment. This includes termination by mutual consent, termination by notice, and summary dismissal. The length of the notice period, if not specified in the contract, is determined based on the duration of employment, ensuring a fair and reasonable approach to both parties.
• Summary Dismissal: The EA allows for summary dismissal without notice, but only under stringent conditions such as misconduct. Misconduct is defined under the Act and includes serious offences like dishonesty, theft, and behaviour that significantly breaches workplace standards.
• Rights and Remedies: The EA provides remedies for wrongful dismissal. Employees who believe they have been wrongfully dismissed can seek recourse through various channels including the Ministry of Manpower (MOM), the Employment Claims Tribunals (ECT), and by consulting with an employment lawyer in Singapore
• Adjudication of Disputes: In cases of dispute regarding the termination, the EA provides mechanisms for resolution through mediation and, if necessary, adjudication by the ECT.

These provisions ensure that terminations, when they occur, are handled in a manner that is fair and justifiable, providing a balanced approach that respects the rights of both employers and employees.

Is Your Dismissal Valid?

Determining the validity of a dismissal under Singaporean law involves assessing several key factors:

• Compliance with Contractual Terms: A dismissal is valid if it adheres to the terms of the employment contract, including any stipulated notice periods or conditions for termination.
• Conformity with the Employment Act: The dismissal must align with the provisions of the Employment Act. This includes ensuring that reasons for dismissal are not less favourable than those specified in the Act.
• Legitimate Grounds for Dismissal: Valid reasons for dismissal include unsatisfactory performance, misconduct, and redundancy. Misconduct, in particular, requires a higher standard of proof and must be substantiated.
• Procedure Followed: The process leading to dismissal should be fair and transparent. For misconduct-related dismissals, employers must conduct a due inquiry, giving the employee a chance to respond to the allegations.
• Absence of Discrimination: The dismissal should not be based on discriminatory grounds such as age, gender, race, religion, or family responsibility.

If these criteria are met, the dismissal is likely to be considered valid under Singapore employment law. Failure to meet these criteria could render the dismissal wrongful or unfair, leading to potential legal ramifications for the employer.

What Constitutes Wrongful or Unfair Dismissal in Singapore?

Wrongful or unfair dismissal in Singapore is defined by several key criteria:

Discriminatory Grounds

Dismissal based on age, gender, race, religion, or other discriminatory factors is deemed wrongful. This includes cases where an employee is dismissed due to pregnancy, family responsibilities, or inability to converse in a preferred language that is not a job requirement.

Deprivation of Benefits or Entitlements

Terminating an employee to deny them contractual or statutory benefits, such as medical entitlements or maternity leave, constitutes wrongful dismissal.

Punishment for Exercising Employment Rights

Dismissing an employee as a reprisal for exercising their legal rights, like refusing overtime due to family commitments or filing a legitimate workplace complaint, is unfair.

Unsubstantiated Grounds

If an employer cites performance issues or misconduct as reasons for dismissal, they must substantiate these claims. Failure to do so can render the dismissal wrongful.

Involuntary Resignation

Forcing an employee into resignation, often seen in constructive dismissal cases, is considered wrongful. This situation arises when employees resign under duress, feeling they have no other choice.

Adherence to Tripartite Guidelines

The Tripartite Guidelines on Fair Employment Practices provide additional guidance on what may constitute wrongful dismissal, reinforcing the need for equitable and non-discriminatory employment practices.

Understanding these criteria helps employees recognise when their dismissal may be unjust and informs employers about the legal obligations they must adhere to when considering termination of employment.

Legal Remedies For Wrongful Dismissal

In Singapore, employees who have been wrongfully dismissed have several legal remedies available:

Filing a Complaint with MOM

Employees can file a complaint with the Ministry of Manpower (MOM) through the Tripartite Alliance for Dispute Management (TADM). This is particularly relevant for managers and executives, including foreign employees, who have served their employer for at least six months.

Claims for Wrongful Dismissal

Under Section 14(2) of the Employment Act, employees can lodge a claim for wrongful dismissal if they believe their dismissal lacked just cause or excuse. Successful claims may result in reinstatement of employment or compensation.

Mediation and Arbitration

Before proceeding to court, the involved parties are encouraged to seek mediation through TADM. If unresolved, the case can be escalated to the Employment Claims Tribunals (ECT).

Monetary Compensation

The ECT assesses claims for loss of income and harm caused to the claimant, with caps applied based on the employee’s gross rate of pay.

Legal Proceedings

In cases where significant damages are claimed, or if the matter is not resolved through TADM or ECT, employees may take legal action in court. Engaging a lawyer is advisable for navigating the legal process and document preparation.

Time Limits for Filing Claims

Employees must file their claims within specific time frames – one month from the last day of employment or, for wrongful dismissal during pregnancy, within two months of childbirth.

These legal pathways provide a structured approach for addressing wrongful dismissal, ensuring that employees can seek justice and employers are held accountable for their actions.

Speak to an employment lawyer to learn more about your options.

What Should An Employer Do When There’s a Wrongful Dismissal Claim

When faced with a claim of wrongful dismissal, employers in Singapore should take the following steps:

Review the Dismissal Process

Ensure that the dismissal was conducted in line with the contractual terms and the Employment Act. This includes reviewing if the reasons for dismissal were valid and whether due process was followed.

Gather Documentation

Compile all relevant documents, such as the employment contract, records of the employee’s performance, documentation of any misconduct, and correspondence related to the dismissal. This will be crucial in demonstrating that the dismissal was justified.

Engage in Internal Resolution Mechanisms

Address the claim through internal grievance procedures first. Many disputes can be resolved internally without escalating to legal proceedings.

Participate in Mediation

If the issue is brought to TADM, actively participate in the mediation process. This can often lead to an amicable resolution and avoid further legal action.

Prepare for Tribunal Proceedings

If the matter proceeds to the Employment Claims Tribunal (ECT), prepare to present the case effectively. This includes organising evidence and potentially seeking legal advice.

Compliance with Tripartite Guidelines

Ensure adherence to the Tripartite Guidelines on Fair Employment Practices, focusing on non-discriminatory and fair employment practices.

Learning and Improving Policies

Use the experience to review and improve HR policies and dismissal procedures, ensuring compliance with employment laws and reducing the likelihood of future claims.

By taking these steps, employers can responsibly manage wrongful dismissal claims, potentially resolving them effectively while minimising legal risks and maintaining their reputation.

Resolving Disputes: Internal and External Mechanisms

In Singapore, both internal and external mechanisms are available for resolving employment disputes, including wrongful dismissal claims. These mechanisms provide structured avenues for both employees and employers to address and resolve their grievances.

Internal Resolution Mechanisms

1. Company’s Human Resources Department: Often the first step involves approaching the company’s HR department. Employees can raise their concerns and provide evidence supporting their claim of wrongful dismissal.
2. Internal Grievance Procedures: Many companies have formal grievance procedures that allow for an impartial review of the dismissal. Employees are encouraged to utilise these channels to seek an amicable resolution.
3. Management Intervention: In some cases, higher management may intervene to review the dismissal decision, especially if the claim involves potential legal implications or breaches of company policy.

External Resolution Mechanisms

1. Tripartite Alliance for Dispute Management (TADM): If internal mechanisms fail, employees can approach TADM for mediation and advisory services. TADM plays a crucial role in providing a neutral ground for both parties to discuss and potentially resolve the dispute.
2. Employment Claims Tribunals (ECT): Disputes that cannot be resolved through TADM can be escalated to the ECT. The ECT provides a low-cost and efficient forum to adjudicate employment disputes, including wrongful dismissal cases.
3. Legal Action: As a last resort, either party may pursue legal action in court. This is generally considered when the dispute involves complex legal issues or significant claims.

The Employment Claims Tribunal (ECT) In Singapore

The Employment Claims Tribunal (ECT) in Singapore plays a pivotal role in resolving employment disputes, including those related to wrongful dismissal. Here’s an overview of its function and process:

Jurisdiction and Function

• Scope: The ECT handles claims related to salary-related disputes and wrongful dismissals. It provides a platform for both employers and employees to resolve their disputes efficiently.
• Authority: The ECT has the authority to hear and make binding decisions on the cases presented to it, within the limits of its jurisdiction.

Process at the ECT

1. Filing a Claim: After unsuccessful mediation at TADM, either party can file a claim at the ECT. The claim must be filed within the stipulated time frame from the date of the mediator’s certification.
2. ECT Hearing: The ECT conducts a hearing where both parties can present their case. This includes submission of evidence, witness testimonies, and legal arguments.
3. Mediation at ECT: Before the hearing, the ECT may refer the parties to mediation to attempt an amicable resolution.
4. Decision and Orders: The ECT will make a decision based on the evidence and arguments presented. It can issue orders for compensation, reinstatement of employment, or dismiss the claim.
5. Binding Nature: The decisions of the ECT are final and binding on both parties. They have the same force as a court judgment.

Impact and Importance

• Accessible Dispute Resolution: The ECT provides a more accessible and cost-effective alternative to traditional court proceedings, making it easier for individuals to seek justice.
• Efficient Resolution: The ECT aims to resolve cases quickly, which is beneficial for both parties who are seeking a swift resolution to their employment dispute.
• Impartial Adjudication: As an independent tribunal, the ECT ensures impartiality and fairness in its decisions, maintaining confidence in the employment dispute resolution process.

Conclusion

Wrongful dismissal in Singapore is governed by a robust legal framework that aims to balance the rights of employees and employers to ensure fair and lawful practices.

Dealing with a wrongful dismissal involves a combination of legal knowledge, procedural fairness, and a commitment to equitable employment practices, if you are facing a potential wrongful dismissal, a wrongful dismissal, or even dealing with a wrongful dismissal claim from an employee, speak to us to learn more about your options.