Meaning Of The Term Employee
Underlying a typical employer-employee relationship would be a contract. Hence the matters discussed in the chapters pertaining to contract law would generally still be of relevance. In addition, there are many other legal issues concerning employment. This chapter is concerned with these as well as the contractual issues pertaining to employment.
MEANING OF THE TERM "EMPLOYEE"
The first issue that has to be sorted out is the meaning of the term "employee". Though it may seem obvious who an employee is, this may not always be so. Instead of being an employee, a person may actually be an independent contractor. It is important to make a distinction between an employee and an independent contractor at the very outset for various reasons. For instance, generally an employer is vicariously liable' for the acts of his employee, but not for the acts of his independent contractor. Further, various statutes such as the Central Provident Fund Act, Employment Act and the Workmen's Compensation Act impose obligations on employers in respect of employees and not in respect of independent contractors. Thus it is important to make this distinction.
As stated in Market Investigations, Ltd V Minister of Social Security (1968), in determining whether a person is an employee or an independent contractor, there is no overriding test and all relevant factors have to be taken into account. Further, the way in which the
Subject to exceptions, both the conventions provide for limitation of liabilities. These limitations are binding and are not subject to the issues contract describes the relationship is inconclusive. Thus even if the contract states that a person is not an employee, in legal terms he may still be considered an employee. Some of the relevant factors are:
• control (the more control one exercises over the services of another, the more likely that there is an employment relationship between the parties)
• integral part of the work (if a person engages the services of another and those services form an integral part of the business of the person engaging the services, that points towards there being an employment relationship between the parties)
• method of payment (if payment is made according to work done, that points towards there being no employment relationship between the parties; on the other hand, if payment is made in the form of wages or salary, that points towards there being an employment relationship between the parties)
• obligation to work only for the employer (if there is such an obligation, that points towards there being an employment relationship between the parties)
• stipulations as to working hours (if there are such stipulations, that points towards there being an employment relationship between the parties)
• overtime pay (if there is such pay, that points towards there being an employment relationship between the parties)
• holidays (if the contract provides for holidays, that points towards there being an employment relationship between the parties)
• medical leave (if the contract provides for medical leave, that points towards there being an employment relationship between the parties)
• right to dismiss (if the contract provides for dismissal, that points towards there being an employment relationship between the parties)
• right to delegate work (if the individual can delegate his work to others, that points towards there being no employment relationship between the parties)
• provision of tools and equipment (if the individual provides his own tools or equipment for the services, that points towards there being no employment relationship between the parties)
• chance of profit or loss (if the person providing the services stands to make a profit or a loss, that points towards there being no employment relationship between the parties)
These factors are not exhaustive. Neither are they conclusive. Further, different factors may point in different directions and hence all the factors have to be weighed and balanced before finally coming to a determination.
One case in which the issue arose for consideration was Kuroeka Enterprises Pte Ltd v CPF Board (1991). In this case, the question arose as to whether Central Provident Fund contributions had to be made in respect of certain freelance hostesses. That depended on whether the hostesses were employees of the lounge. On the facts, the lounge had complete control over the services provided by the hostesses. Moreover, the services formed an integral part of the business of the lounge. In addition, the hostesses did not stand to make a profit or a loss by providing their services. Further, the lounge had the right to dismiss the hostesses. In the circumstances, the court held that the hostesses were employees of the lounge.
DUTIES OF THE EMPLOYEE
An employment relationship imposes various duties on the part of the employee. These duties are implied into the contract of employment.' Some of these implied duties are as follows:
Duty to obey instructions
Firstly, it is the duty of the employee to obey the instructions of the employer. If the employee does not obey the instructions of the employer and that amounts to a repudiatory or fundamental breach' on the part of the employee, the employer may be able to summarily dismiss the employee without having to give him notice or salary in lieu of notice. In Pepper v Webb (1969) for instance, when the gardener, who was told by his employer to do some work, refused and replied that he could not care less about the employer's "bloody greenhouse and ... sodding garden", the court held that the employer was justified in summarily dismissing the employee.
However, the employee does not have a duty to obey his employer's instruction if it is unreasonable. What is unreasonable would depend on the circumstances. However, in Sim v Rotherham Council (1987), the court held that it was not unreasonable for the teachers in question to be asked to cover for teachers who were absent. Similarly, in Cresswell v Board of Inland Revenue (1984), the court held that it was not unreasonable for the employer to ask his employees, who were used to working manually, to switch over to computers.
In addition, the employee does not have to obey an instruction of the employer if it is unlawful or if it exposes the employee to exceptional risk that is not normal in that line of work. For instance, in Donovan v Invicta Airways Ltd (1970), the court held that the pilot employee did not have to obey his employer's instructions to fly an unsafe plane. Similarly, in Morris v Henlys Ltd (1973), the court held that the employee in question was not in breach of contract in not following his employer's instructions to falsify certain records belonging to the employer.
Duty of care
Secondly, an employee owes his employer a duty of care or a duty not to be negligent.' If this duty is breached and it causes a loss to the employer, the employer may be able to sue the employee for the loss. In Janata Bank v Ahmed (1981), the bank employee was careless in not making certain checks, as a result of which a client managed to defraud the bank. The court held that the employee was liable to the bank for the loss.
Where the duty is breached, in addition to suing for damages, if the employee's breach is repudiatory or fundamental,' that may also justify summary dismissal without notice or salary in lieu of notice.
Duty of good faith and fidelity
Thirdly, an employee owes his employer a duty of good faith and fidelity. Thus for instance, the employee should not, without the employer's consent, place himself in a position of conflict of interests, make use of the employer's property for his own purposes or take a secret profit or bribe.' If the duty is breached, the employee may be made liable for the losses suffered by the employer or, in certain circumstances, may have to account for the profits made. Additionally if the breach is repudiatory or fundamental,' the employee may be summarily dismissed without the employer having to give him notice or salary in lieu of notice. In Boston Deep Sea Fishing v Ansell (1888) for instance, where the employee director took a secret commission on a shipbuilding contract, he was ordered to turn over the commission to the company and in addition it was held that he was rightfully dismissed summarily.
The duty of good faith and fidelity also requires the employee not to do outside work if by doing such outside work, his employer's interests are likely to be greatly affected. For instance in Hivac Ltd v Park Royal Scientific Instruments Ltd (1946), where the highly skilled employees in question who had access to their company's manufacturing data worked for competitors during their spare time, the court held that this duty was breached. On the other hand, in Nova Plastics Ltd v Froggatt (1982), where an odd job labourer started working for a competitor in his free time, the court held that the duty was not breached, as great harm was unlikely to be inflicted on the employer.
The contract may also expressly provide for such restraints and such restraints would be enforceable if they are not unreasonable considering the circumstances:' Rowe v Radio Rentals Ltd (1982). If the implied duty or a valid express restraint is breached, the employer may be able to sue for damages if he suffers some loss or to seek an account for profits made by the employee. Further, if
the breach is repudiatory or fundamental,' the employee may also be summarily dismissed.
The question might also arise as to whether the employee can work for a competitor or set up a business in competition after he leaves his current job. There might be an express clause in the contract pertaining to this, and the validity of such express clauses have been examined elsewhere. However, even without such an express clause, the employee is duty bound not to work for a competitor or set up a business in competition if he had access to trade secrets or highly confidential information. However, if the information is not highly confidential in nature or if it does not amount to a trade secret, then the employee is free to work for a competitor or set up a business in competition. What is highly confidential would depend on the facts of each case. In Medivac International Management Pte Ltd v John Walter Moore (1988), the information in question related to certain charge rates. As these charge rates were easily available in the market, the court held that the information was not highly confidential and hence the employee was not restrained from making use of it.
If the information relates to a trade secret or is highly confidential and the employee starts working for a competitor or sets up his own business in competition, he may be liable in damages or may have to account for profits made. He may also be restrained by means of an injunction from so competing or working for a competitor.
DUTIES OF THE EMPLOYER
Just like the employee, the employer too owes various duties in an employment relationship. These duties are imposed through statutes as well as case law.
Duties under the Employment Act
One statute that imposes various duties on the employer is the Employment Act. Unless otherwise stated all sections referred to in
this part are with reference to the Employment Act. However, the Employment Act does not apply to all employees. It only applies to employees as defined in section 2 of the Employment Act. Section 2 states that an employee is a person engaged under a contract of services and that includes a workman. Under the Employment Act, a workman refers to the following:
• any person, skilled or unskilled who is engaged in manual labour including any artisan or apprentice,
• any person employed in the operation or maintenance of mechanically propelled vehicles used for the transport of passengers for hire or for commercial purposes,
• any person employed partly for manual labour and partly for the purpose of supervising any workman provided, at least half his time is spent on doing manual work,
• bus conductors,
• lorry attendants,
• bus, lorry and van drivers,
• bus inspectors,
• goldsmith and silversmith employed in the premises of the employer,
• tailors and dressmakers employed in the premises of the employer, • harbour-craft crew, and
• all workmen employed on piece rates in the premises of the employer.
However, section 2 of the Employment Act does not extend the term employee to include the following:
• domestic workers
• any person employed in a managerial, executive or confidential, position, and
• any person employed by the government or a statutory board.
Thus these persons are not covered by the Employment Act. Further, certain provisions of the Emnlovment Act such as Part IV only apply to employees who are workmen or who earn a basic salary not exceeding $1,600 per month. Thus in the case of an ordinary teacher or clerk in a private school, since he or she is unlikely to be employed in a managerial, executive or confidential position, the Employment Act is likely to be applicable. However, if he or she earns more than $1,600 a month, Part N of the Employment Act and other parts or provisions with similar restrictions would not apply. Further, it must be pointed out that provided a person falls within the ambit of the Employment Act, it does not matter that he is a foreigner or part-timer."
We shall now proceed to look at some of the duties imposed by the Employment Act. Many of the duties imposed on the employer emanate from Part N of the Employment Act, which contains matters pertaining to rest days, leave and hours of work. However, as stated, Part N only applies to workmen or employees earning not more than $1,600 per month.
(a) Rest days, leave and hours of work
Section 36 of Part IV provides that every employee is entitled to one rest day in a week, which shall be a Sunday or such other day as may be determined by the employer. It is also provided that in the case of shift work, a continuous period of 30 hours of rest may be substituted as a rest day (section 36(2)). Subject to certain limited exceptions (section 38(2)),12 an employee cannot be forced to work on a rest day. However, if the employee does work on the rest day, he is entitled to additional pay, the details of which are contained in section 37.
Section 38(1) of Part IV provides that an employee shall not be required to work more than 8 hours in a day or 44 hours in a week. Thus an employee cannot be forced to work beyond that. However, there are certain limited exceptions to this rule, such as where there has been an accident or where the work is essential for defence or security (section 38(2)). Where the employee does work beyond the required hours, he is entitled to overtime pay, the details of which are contained in section 38(4).
Section 42 of Part IV relates to public holidays, and it provides that the employee is entitled to paid leave in respect of public holidays, though by agreement the employer may substitute some other day or days. If an employee is required to work on a public holiday, he is entitled to additional pay, the details of which are contained in section
Section 43 of Part IV relates to annual leave, and it provides that an employee who has served an employer for not less than 3 months is entitled to 7 days of leave for the first 12 months of continuous service with the same employer and an additional day of leave for every year of completed service subject to a maximum of 14 days. However, the contract or collective agreement" may provide for more days of leave (section 53(3)).
Matters such as compassionate leave, study leave or unpaid leave are not governed by the Employment Act. Thus whether the employee is entitled to such leave would turn on the provisions of the contract or collective agreement.
Section 44 of Part IV relates to sick leave. It provides that an employee who has been certified to be sick by a medical practitioner and who has served an employer for a period of not less than six months is entitled to 14 days of paid sick leave in a year, if he is not hospitalised, and to 60 days of paid sick leave in a year, if he is hospitalised.
Failure to observe any of the provisions of Part N results in a commission of an offence on the part of the employer (section 53).
(b) Payment of salary
Aside from Part IV, the Employment Act also has provisions pertaining to the payment of salary, such as when salary is to be paid or when deductions can be made from salary (sections 20 to 34). However, unlike in some countries, Singapore does not have in force a minimum wage that has to be paid. Further, it may be noted that in relation to wage increases, while the National Wages Council may make recommendations in respect of annual wage increases, these are not binding on employers and hence employers are not
legally obliged to follow them. It may also be noted that in relation to redundancy payments, though there is a reference to such payments under the Employment Act, such payments are not compulsory under the Employment Act. However, they may be paid if the contract or collective agreement calls for it.
In respect of employees not covered under the Employment Act or under Part IV of the Employment Act, the various matters discussed above such as sick leave or entitlement to overtime pay would have to be determined by looking at the provisions of the contract or the collective agreement.
(C) Maternity leave
In relation to maternity leave, besides the Employment Act, another statute that is relevant is the Children Development Co- Savings Act. Pursuant to the Employment Act (section 76) and the Children Development Co-Savings Act (section 9), every female employee" is entitled to maternity leave for
• a period of four weeks immediately before and for a period of eight weeks immediately after her confinement, or
• a period of 12 weeks, as agreed to by her and her employer, commencing not earlier than 28 days immediately preceding the day of her confinement or later than that day, or
• a period of eight weeks, as agreed to by her and her employer, commencing not earlier than 28 days immediately preceding the day of her confinement or later than that day and to one or more further periods, not exceeding 24 days in aggregate, as agreed to by her and her employer, which shall be taken within six months commencing on the day of her confinement.
In addition, under the Employment Act and the Children Development Co-Savings Act, in respect of the first and second confinements, the employer is required to pay the employee for a period of eight weeks. This is not subject to any maximum. For the remaining period of the maternity leave, the employer is also obliged to pay the employee by virtue of the Children Development Co-Savings Act. However, this is subject to a stated maximum. Further, the employer who makes the latter payment can seek reimbursement from the Government. In respect of the third and fourth confinements, there is no obligation to pay under the Employment Act. However, there is an obligation to pay under the Children Development Co- Savings Act, though this is again subject to a stated maximum. The employer who makes the payment can likewise seek reimbursement from the Government. Any employer who fails to pay his female employee in accordance with her entitlement would be guilty of an offence (section 87).
Duties under the Central Provident Fund Act
Section 7 of the Central Provident Fund Act provides that every employer, unless exempted, has to pay Central Provident Fund contributions in respect of the employee at the prescribed rates. This duty extends to part-time employees as well. However, there are certain exemptions such as in respect of
• domestic employees, and
• foreign employees on employment passes, professional visit passes or work permits.
Where the contributions have to be made and they have not been made, that would amount to an offence under 58 of the Central Provident Fund Act.
Duties under the Retirement Age Act
The Retirement Age Act provides that the minimum age of retirement in Singapore is 62 years. However, there are certain exceptions, such as in the case of cabin crew, police officers and teaching staff of universities and polytechnics. If a person were unlawfully forced to resign or retire before his retirement age on the ground of age, the employer would be guilty of an offence under section 4(3) of the Retirement Age Act. However, if an employee is genuinely dismissed on some other ground, for instance, if he is dismissed because he has misappropriated the employer's property, section 4(3) would not be triggered.
Duties under the Factories Act
Another statute that imposes various obligations on the employer is the Factories Act. Unless otherwise stated, all sections referred to in this part are with reference to the Factories Act.
Section 6(1) of the Factories Act provides a general definition of a factory. It states that a factory is a place where persons are employed in manual labour for the purposes of
• making of any article or part of any article; or
• altering, repairing, ornamenting, finishing, cleaning, washing, breaking up or demolishing any article; or
• adapting for sale any article.
provided the work is carried on by way of trade or for purposes of gain, and the employer of the persons working therein has the right of access or control over the place.
Though section 6(1) provides that the work must be carried on by way of trade or for purposes of gain, section 6(9) provides an exception. It states that premises, where building operations or works of engineering construction are carried out on behalf of the Government or a statutory board, shall not be excluded on the ground that work there is not being carried on for the purpose of gain or trade. In addition to the general definition in section 6(10, section 6(2) provides some specific examples of factories where persons are
employed in manual labour. These examples include shipyards and any premises in which building operations or works of engineering construction are carried on.
Subject to some limited exceptions, any person who uses or occupies a factory firstly comes under a duty to register it as such. Failure to do so would result in the commission of an offence (section 9).
Secondly, once a place is deemed to be a factory, the person using or occupying it comes under various obligations relating to diverse matters such as cleanliness (section 12), overcrowding (section 13), ventilation (section 14), lighting (section 15),. drainage (section 16), sanitary conveniences (section 17), the secured fencing of certain equipment such as prime movers and transmission machinery (sections 18 to 22), safe equipment (section 25), dangerous substances (section 26), hoists and lifts (section 29), dangerous fumes (section 34), safe access (section 33), steam boilers (section 36), vulcanisers (section 38), air receivers (section 39), gas plants (section 44), first- aid (section 58) and protective clothing (section 62). In addition to the provisions of the Factories Act, there are numerous regulations imposing obligations in respect of matters such as abrasive blasting, asbestos, crane drivers, shipbuilding, building operations and works of engineering construction.
Contravention of the provisions of the Factories Act or the regulations results in the commission of an offence (section 88). In addition, the employee who is injured may bring a civil claim against the employer for breach of statutory duty. The employee may also be able to sue the employer for negligence or breach of contract. Alternatively, the employee may be able to make a claim under the Workmen's Compensation Act, which is discussed below.
However, it must be pointed out that the Factories Act is likely to be repealed soon and replaced by the Workplace Safety and Health Act. In addition to factories, the latter statute extends the protection to certain other premises such as laboratories. It also imposes obligations on many other parties besides the occupier such as persons at work and manufacturers.
Duties under the Workplace Safety and Health Act
Another statute that imposes various obligations on the employer is the Workplace Safety and Health Act, which has replaced the former Factories Act. Unless otherwise stated, all sections referred to in this part are with reference to the Workplace Safety and Health Act.
Unlike the former Factories Act, the Workplace Safety and Health Act covers more premises. The premises now covered (section 2 read with the First Schedule to the Workplace Safety and Health Act) include:
(a) Factories (which among other premises, includes any premises where building operations or any works of engineering construction are carried out),
(b) Certain parts of an airport,
(c) Any ship in a harbour where certain types of activities are carried out,
(d) Any laboratory,
(e) Any hotel, lodging house, dormitory or service apartment,
(f) Any restaurant, bar or canteen,
(g) Any hospital, hospice or nursing home,
(h) Any veterinary centre, and
(i) Any premises where landscaping or garden maintenance is carried out.
Nonetheless, certain premises such as shops, offices, schools and tourist attractions are yet to be covered. Also unlike the former Factories Act, more people owe duties under the Workplace Safety and Health Act and this, too, is another positive development. For instance, occupiers, employers and employees owe duties under the Workplace Safety and Health Act. The duties of the occupier are set out in section ll and the basic duty of the occupier is to take reasonably practicable measures. The duties of the employer are set out in section 12 and again the basic duty of the employer is to take reasonably practicable measures. The duties of the employee are set out in section 15. For instance, if the employee does not use protective equipment provided or willfully or recklessly endangers the safety and health of himself or others, there could be liability under the Workplace Safety and Health Act.
In addition, unlike the former Factories Act, there can be liability based on risk alone without there being an accident. Finally, it must be mentioned that the Workplace Safety and Health Act only creates criminal liability and not civil liability. If a person is injured at work and wants compensation, he would have to claim work injury compensation under the Work Injury Compensation Act or sue in
Duties under the Workmen's Compensation Act
Section 3(10 of the Workmen’s compensation act provides that if a workman is accidentally injured in the course of his employment,
the employer is liable to pay compensation in accordance with the provisions of the Act.
Section 2(1) of the Workmen's Compensation Act defines a workman as any person engaged in a contract of service whether by way of manual labour or otherwise, but excludes certain persons such as the following:
• persons employed otherwise than by way of manual labour and earning more than $1,600 per month,
• domestic servants, and
• police officers.
As stated in section 3(1) of the Workmen's Compensation Act, liability arises only if the injury occurs in the course of employment. In this regard, as stated in Weaver v Tredegar Iron and Goal Co Ltd
a man's work does not consist solely in the task which he is employed to perform, it includes also matters incidental to that task. Times during which meals are taken, moments during which the man is proceeding towards his work from some portion of his employer's premises to another, and periods of rest may all be included. Nor is his work necessarily confined to his employer's premises. The man may be working elsewhere, eg in a building a house or in work on a road or in work at a dock. The question is not ... whether the man was on the employer's premises, it is rather was he within the scope or area of his employment.
Thus if a foreign worker working in a construction site is accidentally injured while resting or taking a toilet break, the irLjury would still be deemed to have occurred in the course of employment. Further, so long as the injury occurs in the course of employment, liability would attach and it does not matter that the employer is not at fault.
In order to meet the claims under the Workmen's Compensation Act, section 23(1) of the Act provides that every employer has to take out compulsory insurance. Failure to do so results in the commission of an offence (section 23(3)). However, the Workmen's Compensation (Exemption of Employer) Consolidation Notification provides that certain categories of employers, such as companies fully owned by the Government, statutory boards, international airlines, international shipping lines, international oil companies, banks, finance companies, retail shops, coffee shops, theatres, hotels, hairdressing salons, tailoring or dressmaking shops and employers of all persons employed otherwise than by way of manual labour, are exempted from taking out such compulsory insurance.
The Third Schedule to the Workmen's Compensation Act lists the amount of compensation that is payable. Though a claim for workmen's compensation may be made quickly, as it does not have to be established that the employer was at fault, there is a maximum limit on the amount of compensation that is payable. This is unlike making a claim under negligence or making a claim for breach of a statutory duty. However, making a claim under negligence or making a claim for breach of statutory duty might involve more cost and time. Thus there are both advantages and disadvantages. But it must be pointed out that the workman has to make a choice. He can either claim workmen's compensation or sue for negligence or breach of a statutory duty (section 33). He cannot claim both amounts, the reason being he cannot be doubly compensated in respect of the same injury.
Aside from compensation, subject to certain limits, the Workmen's Compensation Act also requires the employer or his insurer to bear medical expenses related to the treatment of the workman who is accidentally injured in the course of his employment (sections 13 and 14).
Duty of care
In addition to the matters discussed above, the employer owes the employee a duty of care or a duty not to be negligent. Besides
extending to obvious matters such as providing a safe place of work and safe equipment, this duty can extend to other matters as well. For instance, duty of care can extend to providing competent staff, as in Butler v Fife Coal Company Ltd (1912). In this case, the court held that the employers in question were negligent in appointing incompetent staff as officers to be in charge of a mine, which resulted in the death of the plaintiff's husband, who was an employee working in the mine. Further, though the employer is generally not bound to give job references, if he chooses to give a reference and the reference turns out to be carelessly made, there could be liability to the employee: Spring v Guardian Assurance plc (1994). Moreover, the duty of care not only extends to preventing physical injury or economic loss, but can also in certain circumstances extend to preventing psychiatric damage. In Walker v Northumberland County Council (1995), the employee in question complained to the employers of excessive workload that came about because of severe shortage of staff. Nothing was done and the employee suffered a first mental breakdown and went on medical leave. When he returned the situation at work continued and the employers did nothing to abate it. The employee suffered a second mental breakdown and sued the employers for failing in their duty of care. The court held that the employers were liable for the employee's second mental breakdown.
If this duty isa breached, the employee may be able to bring a claim against the employer either under the tort of negligence or contract and recover damages.
Duty to indemnify
Another duty imposed on the employer is that if the employee incurs expenses in the course of his employment, the employer has the duty to indemnify him in respect of those expenses. Thus if the employee pays up front for items ordered by his employer for the business, the employee is entitled to be indemnified by the employer.
Duty not to discriminate
Finally, it may also be noted that Article 12 of the Constiution, among other things, provides that ll persons are equal before the law and that there shall be no discrimination on the appointment of persons to "any office or employment under a public authority" on the basis of race or religion. Thus for instance, in relation to the appointment of a civil servant, clearly such discrimination cannot be practised. However, it is unlikely that Article 12 extends to private employers. Further, it may be noted that Article 12 does not specifically refer to sex or disability discrimination. Though the legal position is as such, needless to state as a matter of principle, such forms of discrimination should be avoided.
TERMINATION OF CONTRACT OF EMPLOYMENT
Once formed, the relationship of employer and employee as embodied in the contract of employment may come to an end in several ways. The two most common ways in which the contract of employment may come to an end are by way of agreement and by way of a repudiatory or fundamental breach.
In relation to the contract coming to an end by agreement, the parties might have expressly agreed in the contract that it might be terminated by one or either party giving a certain amount of notice. Even if this is not expressly agreed to, either party to the contract would usually have the implied right to terminate the contract by giving reasonable notice, unless the parties intend the contract to be for a fixed period of time and that it should not be terminated by notice prior to that. What would be reasonable notice depends on the circumstances. However, factors such as the custom in the trade, the nature of the employment, the qualifications of the employee and the length of employment thus far are likely to be relevant in determining what is reasonable. For employees falling under the Employment Act, if the contract does not specify the period of notice, section 10(3) of the Employment Act prescribes the amount of notice to be given. For instance it provides that in respect of employees who have worked less than 26 weeks, one day's notice has to be given, and in respect of employees who have worked for more than five years, one month's notice has to be given.
Instead of giving notice, the contract might state that one or either party may also terminate the contract by giving salary in lieu of notice. Even if this were not expressly stated, usually the employer would have the right to terminate the contract by giving salary in lieu of notice. However, it would appear that if the contract does not expressly allow it, the employee does not have a similar right: Trotter v Luxton (1929). Nonetheless, for employees falling under the Employment Act, section 11 of the Employment Act provides that either the employer or employee may terminate the contract of employment by paying salary in lieu of notice.
As stated, the next most common way in which the contract of employment may come to an end is by repudiation or a fundamental breach committed either by the employer or employee. If there is a repudiatory or fundamental breach on the part of the employee, the employer may summarily dismiss the employee without giving notice or salary in lieu of notice. As to what would amount to a repudiatory or fundamental breach would depend on the facts of each case. In Neefies
v Crystal Products Co Ltd (1972) for instance, As to what would amount to a repudiatory or fundamental breach would depend on the facts of each case. Similarly, in Drysdale v New Era Steamship Co Ltd (1936), the habitual drunkenness of an employee was held to have justified his summary dismissal on the facts. Likewise in Motilal v Guthrie Agency (M) Ltd (1968), when the employee in question misappropriated rents belonging to his employer, he was held to have been rightfully dismissed summarily. It may also be noted that employees covered under the Employment Act too can be summarily dismissed on grounds of misconduct or wilful breach (sections 14(1) and 11(2) of the Employment Act).
Generally in implementing a summary dismissal, the employer does not have to follow any procedure. In particular he does not have to give the employee a chance to be heard or a chance to explain himself. However, there are certain exceptions to this general rule. For instance, for employees covered under the Employment Act, section 14(1) of the Employment Act provides that they can be summarily dismissed only after a "due inquiry" has been conducted. In Lim Tow Peng v Singapore Bus Services Ltd (1976), the appellants were summarily dismissed on the grounds that they assaulted a fellow employee. However, the court held that there was no due inquiry and hence the dismissal was wrongful. There was no due inquiry on the facts, as the appellants had not been told of their misconduct and were not given a chance to be heard. Similarly, where public officers are concerned, Article 110(3) of the Constitution" provides that they can be dismissed only after they have been given a reasonable opportunity to be heard.
If the correct amount of notice or salary in lieu of notice has not been given and there are no grounds for summary dismissal, or if the procedure for summary dismissal (if any) has not been followed, the dismissal would be wrongful. The employee who is wrongfully dismissed may bring a claim against the employer for damages. However, he generally cannot ask to be reinstated in the job. Nonetheless there are some exceptions to the rule against reinstatement. For instance, for employees falling under the Employment Act, section 14(2) of the Employment Act provides that where an employee considers that he has been dismissed without just cause, he may make representations to the Minister asking for a reinstatement. The Minister may then direct an inquiry and, depending on the outcome, may order the employee to be reinstated. Similarly, for employees who are "public officers", their dismissal may be considered null and void if it does not meet the requirements of natural justice. In such a situation, the employee would be deemed to never have left the employment of the public service.
Just as with the employee, the employer too may commit a repudiatory breach. For instance in Rigby v Ferodo Ltd (1987), the court held that when the employer unilaterally reduced the wages of the employee, he was in repudiatory breach of the contract in the circumstances of the case. if the employer commits a repudiatory breach, the employee may resign summarily without having to give notice or salary in lieu of notice.
TRADE UNIONS AND INDUSTRIAL RELATIONS
Finally we turn our attention to the issue of industrial relations in Singapore. In Singapore, industrial relations are governed by the Industrial Relations Act. The Act aims to resolve industrial disputes amicably through collective bargaining, conciliation and arbitration, instead of encouraging industrial action that may prove to be detrimental to the society.
The starting point of the process is the setting up of a trade union. Trade unions are governed by the Trade Unions Act. Section 2 of the Trade Unions Act provides that a trade union means any association or combination of workmen or employers whose principal object is to regulate the relationship between workmen and employers. Thus there can be both employers' trade unions and workmen's or employees' trade unions. Further, in practice, trade unions can be general and open to all employers or employees regardless of field or industry, or can be exclusive and open only to employers or employees of a particular field, industry; company or occupation. However, in either case, in order to be valid, the trade union has to be registered (section 8(1) of the Trade Unions Act). If it is not registered, it has to be dissolved and it would not enjoy any of the rights and immunities of a registered trade union (section 19 of the Trade Unions Act).
In relation to a trade union of employees, the next step is to seek the recognition of the employer. This is to be done by using the prescribed form (section 16 of the Industrial Relations Act). The employer may choose to grant recognition. Alternatively, he may refuse to do so and notify the Commissioner of Labour in writing, his grounds for not granting recognition. The Commissioner of Labour may then, in his discretion, call a secret ballot and if the secret ballot shows that the majority of employees are members of the particular union, the employer would have to grant recognition. This is pursuant to Industrial Relations (Recognition of a Trade Union of Employees) Regulations.
Once recognised, the trade union of employees may serve a notice on the employer requesting him to negotiate certain industrial matters, or the employer may do the same on his own initiative (section 17 of the Industrial Relations Act). However, it is provided that in the notice, the trade union of emloyees cannot set out to negotiate on matters such as the following, which remain the prerogative of the employer:
• the promotion of any employee,
• the transfer of an employee within an organisation, or the assignment or allocation of duties to an employee that is not inconsistent with the terms of the employment, and
• the termination or the criteria for termination of the services
of an employee by reason of redundancy or reorganisation.
Though the trade union of employees cannot force the employer to negotiate such matters, it would appear that if the employer wishes, he might make such matters negotiable. If the notice to negotiate is not accepted or if no agreement can be reached after negotiations, the Commissioner of Labour may appoint conciliation officers to help the parties reach a consensus (sections 19 and 20 of the Industrial Relations Act). In practice, usually consensus is reached at least by this stage. In the event that it is not, reference may still be made to the Industrial Arbitration Court (section 31).
The outcome of successful negotiations is the collective agreement. The collective agreement can cover a wide array of matters from wages and other benefits to work safety. However, before the collective agreement can be binding, it has to be certified by the Industrial Arbitration Court (section 24). The Industrial Arbitration Court may refuse to certify a collective agreement on various grounds that are set out in section 24(2) of the Industrial Relations Act. For instance, in Singapore Manual & Mercantile Workers Union v Raj Brothers (1969), the Industrial Arbitration Court refused to certify the collective agreement in question, as the court found that the clause in the agreement that stated that, in the event of retrenchment, non-union members would first be retrenched, was discriminatory in nature.
Once certified, the collective agreement is deemed an award of the Industrial Arbitration Court and is binding on the employer and the trade union (section 26 of the Industrial Relations Act). Further, once a collective agreement has been certified, any ambiguity in the terms may be resolved by arbitration at the Industrial Arbitration Court (section 43). In addition, where there is any trade dispute, the employer or the trade union may make a reference to the Industrial Arbitration Court (section 31). The Minister and the President also have similar powers in certain circumstances to refer trade disputes to the Industrial Arbitration Court (section 31). It may also be noted that where a matter is pending at or has been referred to the Industrial Arbitration Court, any form of industrial action such as a strike is prohibited under section 3 of the Trade Disputes Act. The aim of the legislation is basically to force the parties concerned to resolve disputes amicably, instead of resorting to industrial action. On a practical level, the fact that, except for a minor upheaval in 1986, Singapore has been strike free since 1978, shows that this has indeed been achieved.