New Employment Claims Tribunal May Lead to Increase in Claims

The new Employment Claims Tribunal (ECT) was established in 2017 to provide a cheaper and easier alternative to the civil courts for employees wanting to bring salary-related disputes in Singapore. The ECT handles statutory and contractual salary-related claims by employees, as well as claims by employers for salary in lieu of notice of termination. The ECT’s jurisdiction will extend to all levels of employees (except public servants, domestic workers, and seafarers who have other avenues of recourse).

Salary Cap

Claims at the ECT are generally capped at S$20,000 (USD 15,000 : GBP 11,000 : EUR 12,000), but this is raised to S$30,000 (USD 22,500 : GBP 16,500 : EUR 18,000) where unions are involved. If the claim exceeds the cap, the claimant must either forego the excess amount if it wishes to bring the claim to the ECT or bring the claim before the civil courts.

Time Limits

In order to bring a claim to the ECT, a claimant must first register the claim for mandatory mediation with the Tripartite Alliance for Dispute Management (TADM). Requests for mediation must be brought within 12 months of the dispute arising (where the employment relationship is ongoing) or within 6 months from the end of employment (where the employment relationship has ended).

In-Person Attendance

Employees must attend the mediation in person. In cases in which an employee is a member of a union, which has been recognized by the employer, a union official may be present. Employers may send an authorized representative, such as an officer or full-time employee. Legal representation is not allowed at the mediation and in the ECT.

Mediation and the ECT Process

If mediation is successful, parties may enter into a settlement agreement, which can be registered with the district courts. However, if mediation does not result in settlement, TADM will issue a claim referral certificate to the claimant, and the claimant must file its claim with the ECT within four weeks after the issuance of the claim referral certificate if the claimant intends on proceeding with it.

Upon hearing a claim, the ECT may order payment to a party or dismiss the claim. The ECT also has the power to order payment of costs. A dissatisfied party may appeal an ECT decision with leave of court within 14 days from the date of the decision, but the appeal can only be on questions of law and/or the jurisdiction of the ECT to hear the dispute.

Informal Procedure

The ECT is not bound by formal rules on procedure or evidence.

No Contracting Out

Agreements to exclude or limit the jurisdiction of the ECT; to prevent the submission of a mediation request; or to make a claim, application, or appeal are statutorily void to the extent of such exclusion, limitation, or prevention.

Comment

Employers should prepare for a potential increase in the number of salary-related claims, as the ECT process makes it easier for all levels of employees to bring salary-related claims of up to S$20,000 – S$30,000 (USD 15,191-22,787) (GBP 10,887-16,316) (EUR 12,341-18,511) against employers for relatively quick and affordable adjudication. This is compared to a civil claim through the courts, which could be disproportionately costly.

Further, in light of the statutory restrictions on contracting out, employers may wish to review their current employment agreements and relevant policies for compliance.

Employers may also wish to train their legal and human resource teams on the mediation process to make the most of the opportunities that are offered by mediation.

Written by Shu Yi Chye and Susan de Silva of Bird & Bird and Roger James of Ogletree Deakins