If you’re considering hiring contractors from Singapore to work for your company, you need to understand the rules and regulations behind the process. With the right recruiting strategy, you can take advantage of extensive industry expertise from the broad pool of contractors available in the country.
Hiring independent contractors in Singapore
Offering a diverse population of professionals with different specializations, Singapore is an excellent place to find skilled contractors for your company.
Differences between an employee and an independent contractor
While an employee is legally part of your company and on your payroll, a contractor is an independent entity providing services for your company. An independent contractor essentially completes work for your company as a function of their self-owned business. They are not entitled to social security, paid leave, or other provisions.
Penalties for contractor or employee misclassification
If you’re considering hiring Singapore-based contractors for your company, ensure you classify them correctly. Companies that misclassify employees as contractors may be liable for withholding benefits.
How to hire independent contractors for your company
An established hiring strategy can help you support your contractors and their success in completing your company’s projects. Consider these best practices.
1. Plan the right hiring approach
As you evaluate applicants’ credentials and experience, keep in mind that contractors are typically skilled professionals who offer extensive industry knowledge. Contractors are providing a service rather than coming on as employees, so it’s best to treat the process like a business-to-business transaction.
2. Establish a clear contract
When you’re hiring contractors abroad, it’s best to create a contract for service. Consider including these key points in writing:
- Duration of service
- Scope of duties
- Terms for extension or termination of the contract
- Pay rates and schedule
3. Know how to work with contractors
A final, vital step in hiring contractors to support your operations is to provide adequate orientation and training. While they likely bring industry expertise, contractors working with your team may not be familiar with your specific workflows, protocols, and values.
Appoint HR personnel to explain essential software, work platforms, and processes to your new contractors. If they require any specialized training to use your systems effectively, offer courses or live instruction. Providing these resources at the beginning of the project will help new contractors be as productive and successful as possible.
How to pay independent contractors in Singapore
While contractors are not legally on your company’s payroll for employees, they are entitled to agreed-upon compensation. You may choose to use a secure money transfer provider to deliver scheduled payments to your contractors. Remember that you’ll need to find a service that can provide funds internationally.
Under Singapore’s Employment Act, you are not responsible for withholding social security payments, providing health insurance, or offering other benefits and remuneration to independent contractors. Your company will need to meet any commitments for wage rates and payment schedules outlined in your contract.
Termination or extension terms for Singapore independent contractors
Contractors typically work on a project-by-project basis or for a set duration, so termination or extension is usually straightforward. Even so, the best practice is to set clear terms for ending or extending your contract. If either party infringes on the contract terms or encounters other issues, they can be released from their commitment without the need for outside arbitration.
Hire contractors in Singapore with Globalization Partners
As an extension of Globalization Partners’ Global Employment Platform™, G-P Contractor allows companies to hire anyone, anywhere. Whether you’re hiring employees or contractors, we streamline the process with a single solution for your global workforce. Contact us to learn more.