Company fined, barred from hiring foreign workers

IMPACT – MEDIUM

What is the change? In another prosecution over work-pass fraud, a company director who falsely stated foreign workers’ salaries has been fined 21,000 Singapore dollars (about US$15,500) and banned from hiring foreign employees.

What does the change mean? This is the latest case in an ongoing campaign by the Ministry of Manpower to investigate companies for making false or fraudulent declarations regarding foreign workers. Since 2014, the ministry has prosecuted 55 employers in for falsely declaring the salaries of foreign workers.

• Implementation time frame: Ongoing.
• Visas/permits affected: All work
• Who is affected: Companies sponsoring foreign workers on work passes.
• Business impact: Companies that violate the Employment of Foreign Manpower Act face fines of up to SG$20,000, two years in prison, or both.
• Next steps: Employers are encouraged to review their policies and make sure that all information provided on work pass applications is true and accurate.

Background: The case involved an engineering company whose owner filed 10 S-Pass applications stating that the workers would be paid the required minimum salary of SG$2,200 per month. After the S Passes were granted, the workers were paid SG$2,200 per month, but were forced to remit SG$800 per month to the company through a former employee.

The owner pled guilty and was fined SG$21,000 in default of nine months of imprisonment on three of the 10 charges. The remaining seven charges are under consideration. The owner and his company have also been barred from hiring foreign workers.

According to the ministry, the former employee will also be prosecuted for receiving kickbacks, an offense which is punishable by SG$30,000 in fines, two years’ imprisonment, or both.

BAL Analysis: Employers in Singapore should be aware of the heightened enforcement environment and conduct a review to ensure that they are in compliance with all regulations.

This alert has been provided by the BAL Global Practice group in Singapore. For additional information, please contact singapore@bal.com.

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