In previous articles, we have pointed out that employers often flout payslip rules by giving incomplete or no slips, and there is hardly any enforcement by the Ministry of Manpower (MOM).
The requirement to issue payslips to employees is set out in section 96 of the Employment Act. Subsection 96(1)(a) says an employer must give…
every employee of the employer a pay slip, within the time prescribed for giving pay slips, for all salary paid by the employer for the salary period or salary periods to which the pay slip relates.
Failure to provide a payslip is a civil contravention for which the employer may be fined an administrative penalty. The number of employers fined for this contravention since 2016 is unknown.
The following story of Hasan (not his real name) shows how the non-provision of payslips and the lack of enforcement disadvantages workers when they file a salary claim.
Hasan’s story
Hasan worked for the employer for eight months before he suffered a work accident that left him with a fractured ankle. For each month that Hasan worked, the employer paid him a salary in cash but did not provide payslips. Hasan would take what employer paid, trusting that the amount was correct. He was not asked to sign any voucher or receipt, nor did he take notes of the amount he received.
(Even if he had taken notes, his personal record might not carry as much evidential weight as payslips issued by the employer).
When Hasan approached TWC2 for assistance with his work injury claim, we realised Hasan had no payslips. The only salary-related documents he possessed were a copy of IPA and the photographs of time cards for two of the eight months he worked, namely December 2022 and January 2023.
Hasan also explained his employer’s salary payment practice to us, practice which did not comply with the Employment Act.
(A) Overtime wages were considered payable after the eighth hour of work on each work day. This applied to Saturdays even if a worker worked at least 8 hours daily from Monday to Friday.
We explained to Hasan that this practice breached section 38(1)(b) of the Employment Act according to which the employer should pay overtime wages for work done beyond 44 hours in a week. Since the work hours of Monday to Friday already added up to 40 hours, this means that for work on Saturdays, overtime pay should kick in after four hours of work, not eight hours.
(B) For work done on Sundays, the employer paid 1.5 times the basic rate of pay.
We explained that this practice breached section 37(3) of the Employment Act, according to which employers should pay double the normal rate for work done on rest days at the employer’s request.
Based on the information above, there was a strong suspicion that Hasan was a victim of wage theft. We only needed to see copies of his payslips to confirm our suspicion. Since payslips were also crucial for determining Hasan’s work injury compensation amount, we sought the Ministry of Manpower’s assistance to obtain the payslips from employer. MOM responded that they would speak to the latter.
Three months passed, but although each time we enquired, MOM said they would speak to employer, the payslips never appeared. During this time, we were acutely aware that each day that passed, Hasan was forfeiting more and more of his right to claim underpaid overtime and rest day pay. This is because the Employment Claims Act lays down that a worker can only claim for salary violations up to twelve months before the date of claim filing. As each month passed, Hasan lost the right to claim for the months that receded further and further into history. The delay by MOM was seriously disadvantaging the worker.
Claim filed
Hasan had to make a decision. The longer he waited for the employer to provide payslips, the more he would lose of his entitlement to claim underpaid salaries. Filing a salary claim now, even with incomplete evidence, might prompt the employer to produce payslips. After all, it would be in their best interest for the employer to produce payslips if they believed their calculations were lawful.
With MOM providing no help, Hasan reached decision point in August 2023 and filed a salary claim that month at the Tripartite Alliance for Dispute Management (TADM) the unit that handled salary disputes.
Hasan’s claim amount was calculated based on what scraps of other evidence he had: (1) the employer’s declaration to the MOM that his Average Monthly Earnings was $1400 (with no supporting details of calculation provided to Hasan), (2) his In-Principle Approval for a Work Permit showing a basic salary of $728 per month, and (3) two timecards. We estimated that Hasan was short-paid approximately $100 each month on average. Hasan also tried to argue that there was a prima facie case of short payment of salaries based on what he knew of the company’s practices, and the onus should be on the employer to disprove Hasan’s claim by providing detailed payslips.
Here is an extract from his statement to the TADM mediator.
I wish to bring to the attention of the TADM that the non-provision of payslips and the employer’s continuous refusal to provide them despite MOM Caseref’s instruction over the past few months has caused a significant delay in filing my salary claim.
As a result of having to wait for the payslips, I have lost the right to claim for June, July, and August 2022. Even today, I am at a significant disadvantage in filing salary claims without the payslips.
I urge the TADM to tell my former employer to provide me with the payslips before the first mediation.
Unfortunately, even at the mediation session organised by TADM mediation, the employer stubbornly refused to provide payslips. From what Hasan told us, TADM did not appear to care that Hasan’s incomplete evidence stemmed from the non-provision of payslips. At the mediation, TADM advised Hasan to withdraw his claim since he “had no evidence” to support his claim. Hasan complied and withdrew his claim.
Parliamentary debate, adverse inference and statutory obligations
It is interesting that such a situation was anticipated by a member of Parliament when the Employment Claims Bill was moved. On 16 August 2016, K Thanaletchimi (Nominated Member) asked the then-Minister for Manpower Lim Swee Say:
As much of the evidence that employees need to prove their claim would often be in the hands of employers, can the tribunal draw an adverse inference where the employer is not forthcoming with that information so as to facilitate access to evidence?
From the record of the parliamentary debate, the minister seemed not to have replied to this point. However, Section 21(2) of the Employment Claims Act says:
A tribunal may draw any inferences that the tribunal thinks fit from a party’s failure to comply with any obligation of that party under any written law specified in the Fourth Schedule, including (but not limited to) an inference that any evidence that is not available on account of that party’s failure to comply with that obligation would, if produced, have been unfavourable to that party.
The obligation in question is listed in the Fourth Schedule, which is titled “Specified obligations under written law”, and which includes, inter alia, this item: “An employer’s obligations under sections 95, 95A and 96 of the Employment Act 1968”.
In turn, Section 96(1) of the Employment Act says that an employer must provide payslips, as cited at the top of this article.
MOM’s website also has a directive (https://www.mom.gov.sg/employment-practices/salary/itemised-payslips) explaining in plain language that “all employers must issue itemised pay slips to employees covered by the Employment Act”. The webpage also sets out the “detailed requirements such as what items to include, when and how to give them”.
Disappointed at lack of action
Despite the weight of law and MOM’s own directive, the lack of pressure on the employer to produce payslips was extremely disappointing. It made Hasan’s claim quite untenable when TADM told him he had no evidence, despite it being well within the authorities’ powers to require the employer to provide such evidence.
After Hasan felt compelled to withdraw his salary claim, we asked MOM whether Hasan’s employer would be penalised for not providing payslips. We have yet to receive any concrete answer.