This is Part 2 of a story about a safety supervisor’s efforts to recover unpaid salaries and fend off the employer’s demand for six-months’ salary in lieu of notice. In Part 1, we described how the salary claim by Ragav (name changed) was accepted by the Tribunal magistrate almost in its entirety and the employer, which we will call Esben Engineering (name changed), was ordered to pay him $8,642.84.

Despite winning his claim for owed salaries, the big threat faced by Ragav was the employer’s counterclaim for notice pay. Ragav had resigned with no notice in early May 2024, but Esben Engineering pointed out that the employment contract he had signed stipulated that he had to give six months’ notice. At a salary of $1,500 a month, that could mean $9,000 in notice pay, though in the formal counterclaim filed at the Tribunal, the company was only asking for $3,800. Even so, if the company succeeded, it would take a huge chunk out of Ragav’s hard-won Tribunal Order for his owed salary.

But first, a brief explanation of notice period and notice pay may be useful.

Notice period and notice pay

A “notice period” in an employment relationship refers to the required time an employer or employee must provide the other before ending the employment. A notice period is meant to prevent abrupt terminations, allowing the employee time to secure a new job and the employer time to find a replacement. If either party terminates without notice, they must compensate the other with payment in lieu of notice or “notice pay”, equivalent to the salary for the notice period.

In Singapore, the notice period is typically set forth in the employment contract, and commonly ranges from two weeks to one month (the “Contractual Notice Period”). If there is no employment contract or no mention of notice in the contract, the minimum notice period specified by the Employment Act (the “Act”) applies. This ranges from one day to one month, depending on the employee’s length of service (the “Statutory Notice Period”). Regardless of how the notice period is determined, the Act requires that the period must be the same for both the employer and the employee.

However, the Act provides exceptions to the above rules, allowing employers and employees to terminate the contract without observing the notice period under specific circumstances, such as when either party commits a “wilful” breach of contract. One example of a wilful breach specified in the Act is an employer’s failure to pay salary. Additionally, Section 16 of the Act provides that a party’s wilful breach of contract entitles the other party to claim notice pay. For instance, if an employer fails to pay overtime according to the statutory minimum rate, the law allows the employee to terminate the contract without notice and claim notice pay from the employer.

Below is the part of Ragav’s employment contract that set out the six months’ notice period.

Clause 9 sets out the notice period for Ragav’s resignation

At first glance, it looked watertight. How could the employer lose? However, we managed to conceptualise a line of defence for Ragav; in fact it was more than just defence, as the details to follow will show.

Turning the tables

Ragav’s vigorous defence against the counterclaim for notice pay rested on Section 13(1) of the Employment Act, which is pretty unequivocal:

13.— (1) An employer is deemed to have broken the employer’s contract of service with the employee if the employer fails to pay salary in accordance with Part 3.

(Part 3 of the Act sets out rules regarding the payment of salary including timeliness.)

Ragav argued in his witness statement that since the company failed to pay his salary – and the Tribunal in its finding of fact found it to be so – it was a wilful breach of contract; and once the contract had been broken, he had the liberty to leave employment without notice. He testified, “I decided to leave because I was not paid the full salary I was entitled to.” Ragav referred to Section 11(2) of the Employment Act in his statement too:

11.— (2)  Either party to a contract of service may terminate the contract of service without notice in the event of any wilful breach by the other party of a condition of the contract of service.

Ragav was no longer bound by the six-month notice period. The employer’s demand for notice pay could not stand.

However, there is also Section 10(2) of the Employment Act, a point that we explained to Ragav, adding it to his witness statement.

10.— (2) The length of the notice must be the same for both employer and employee and is to be determined by any provision made for the notice in the terms of the contract of service, or, in the absence of such provision, must be in accordance with subsection (3).

The employment contract had been badly written. It stipulated a notice period of six months if the employee chose to resign, but was silent on the reciprocal notice period if the employer was the side that chose to terminate the employment. Relying on Section 10(2) which required symmetry in notice periods, Ragav then advanced his claim that the same six months’ notice period should be obligatory on the employer as well.

But there’s more. Not only would a six-month period be obligatory on the employer, Ragav argued that since the employer had breached the contract, then Section 16 of the Employment Act made notice pay obligatory on the employer as well. He was entitled to claim for notice pay to the tune of the same $9,000. Section 16 says:

16. Subject to anything in the contract of service to the contrary, the party who breaks the contract of service is liable to pay to the other party a sum equal to the amount the firstmentioned party would have been liable to pay under section 11 had the firstmentioned party terminated the contract of service without notice or with insufficient notice.

The judge found in Ragav’s favour again and ordered the employer to pay him $9,000 being six months’ notice pay. Overall, the Tribunal’s decision was not a great surprise as the law was unequivocally on Ragav’s side, backed by overwhelming evidence against the employer.

Spite

Getting a favourable judgement was not the end of it. Getting Esben Engineering to honour the Order and pay up might take nearly as long.

The employer was prepared to pay up the owed salary but refused Ragav’s request to do so via bank transfer. They first insisted that Ragav visit their office to receive $8,642.84 in cash. Ragav refused. If cash was to be the mode of payment, it should be done at the TADM office in the Ministry of Manpower so that the TADM officer could be the neutral witness. Still, the employer was determined to humiliate their former employee, arriving at TADM with hundreds of $2, $5, and $10 loose bills worth $8,642, tossing them onto the table for Ragav to count in front of both the employer and the TADM mediator.

The loose cash in small bills from the employer

Ragav observed that the TADM mediator was also annoyed by such childish behaviour, but didn’t say much. TWC2 had to help Ragav deposit the hundreds of bills into an ATM machine in the evening. It was laborious, holding up the queue of other people wanting to use the ATM (we had to stop midway to let others use the machine).

As for the notice pay, the employer moved to appeal the Tribunal’s order. They claimed that the Tribunal’s order was “manifestly unfair” and that Ragav’s abrupt resignation damaged the company (although there was no evidence of any damage). Adding insult to injury, they offered to withdraw the appeal application if he accepted a settlement at $0 instead of the awarded $9,000 in notice pay.

Ragav dismissed the offer, knowing that the threat was baseless and the offer was absurd. Days later, the employer raised their offer to $4,500, half of the ordered amount. Ragav was keen to conclude the matter and move on with his life. Also wanting to go home to his family whom he had not spent much time with in recent years, he accepted the offer and this time, the money came in through a bank transfer.

Afterthoughts

The employer’s failure to pay Ragav his salary constitutes an offence punishable by a fine ranging from $3,000 to $15,000, imprisonment for up to six months, or both upon conviction. Failure to pay overtime or rest day salary is also an offence, punishable by a fine of up to $5,000. However, by TWC2’s observation, it is rare for the Ministry of Manpower (MOM) to take action against employers whose salaries were partly paid during the months of employment, as seen in Ragav’s case.

In 2023, MOM secured convictions against nine companies or company directors for failing to pay salaries (see this page on MOM’s website, accessed 8 March 2025) while there were 8,125 salary cases filed at TADM (see TADM’s 2023 Annual Report). In 2024, there were eight convictions. TADM’s 2024 report has not yet been published (as at time of writing). Albeit that the data are for different years and prosecutions tend to lag timewise behind the filing of cases at TADM, we can still get a general sense that convictions represent 0.1 percent of cases filed.

While details of convicted cases remain mostly undisclosed, it appears that MOM’s prosecution efforts primarily target instances where employees were not paid at all, as in the recently reported case of Sakura Buffet (See Straits Times story 1 June 2024).

It should be borne in mind, however, that workers often suffer in silence, too afraid of losing their jobs and being repatriated to make a formal filing. So even TADM’s numbers seriously understate the real situation on the ground.

In cases like Ragav’s where his employer underpaid salary and overtime for over ten months – amounting to a substantial $8,600 in wage theft – MOM appears disinterested in taking enforcement action; we do not hear of prosecutions for this level of wage theft. This lack of action sends a troubling message to errant employers: it is permissible to violate the law and shortpay workers.

The implication is that as long as employers eventually pay the correct salary (e.g. ordered by the Employment Claims Tribunal) there are no real consequences for their unlawful actions. This not only undermines workers’ rights but also reinforces Singapore’s pro-employer stance, where salary protections exist on paper but are frequently ignored in practice.

TWC2’s recommendations

MOM’s reliance on individual employees stepping forward to challenge their employers for violating salary rules – without meaningful consequences for the offenders – unfairly shifts the burden onto workers. Instead, the emphasis should be on enforcement, prevention, and deterrence.

  • MOM should ensure that nearly 100% of wage theft cases lead to penalties for employers. Penalties can range from compound fines and demerit points for less severe violations to prosecution and jailtime for directors for more severe ones. Excuses such as ignorance of the law should not be tolerated.
  • To improve the detection of wage theft, MOM should strengthen the enforcement of related rules such as those requiring detailed itemised payslips, written Key Employment Terms (KET) and salary payment through bank. There should be unannounced inspections on payroll practices.
  • Every time one worker in a company makes out a case of short-payment, enforcement officers should conduct a thorough check of the payroll of all the other employees of that company.
  • To maximise the deterrent value of such enforcement, all cases where an employer failed to pay salaries on time should be publicised on a master list, even if the severity is moderate and only warrants administrative penalties. It’s of little use to penalise errant employers but keep each case secret.
  • In addition, contractors bidding for government contracts could also be asked to show a clean record with respect to salary payments.

For there to be any improvement there must be tangible consequences for all non-compliant employers, not just 0.1 percent.

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