Employers’ guide to cancelling a Singapore work pass
5 minute read
Being in business pretty much means adapting to an ever-changing situation. Employers constantly have to be on their toes when it comes to issues such as new regulations or changing market demands.
The job of an employer, while staying abreast of the latest changes, is also to look after their employees, including their legal obligations to them. This especially holds true if workers are employed from other countries. From keeping track of all the necessary legalities involved in allowing them to work to cancelling legal documents such as their work passes when they cease their employment with the firm! This article takes you through the instances in which this situation could arise and the process involved in cancelling a Singapore work pass.
Overview:
When to cancel a work pass
As an employer, you’ll face a number of situations where you’ll need to cancel an employee’s work pass. Some example include:
- Resigning/ retrenchment with intentions to move to another country
- Resigning/ retrenchment with intentions for new employment
- Resigning/ retrenchment with intentions to start a business in Singapore
Additionally, the rules and duration for cancelling a work pass may vary according to whether your employee will continue to reside in Singapore after the end of their employment.
Resignation/ retrenchment and leaving Singapore permanently
Once your employee submits their resignation letter or has been informed of their retrenchment, you’ll need to cancel their work pass within one week after their last day of notice. In this situation, the work pass cancellation takes effect from the last day of their employment to which they then have to leave Singapore, unless they have been issued with another valid pass.
When a work pass is canceled, all passes related to it such as the Dependent’s Pass (DP) or Long Term Visit Pass (LTVP) are canceled too. Therefore, anyone attached to the work pass will have to leave Singapore too.
In unforeseen situations where the resignation or termination is sudden, the employer will have seven days to cancel the employee’s work pass. Due to the short notice, the employee and their dependents will be issued a short-term visit pass (STVP) in this instance. This gives them a short period of time to prepare for their departure. When they leave Singapore, they’ll have to return this STVP to the Immigration Checkpoint Officer.
Resignation/retrenchment but staying in Singapore
Work passes are tied to specific employers. Therefore, if your employee wishes to resign and find another job in Singapore, it is the responsibility of their new employer to get them another work pass.
Generally, it is advised that current employment pass not be canceled till a new one has been granted. Therefore, if an employee resigns, they should only do so once they have received a fresh work pass tagged to their new employer.
Here is a checklist on how the process progresses from here on:
- Once a new pass has been approved, the Ministry of Manpower (MOM) will send the In-Principle-Approval (IPA) letter to the address given in the application.
- On receiving this letter, the employee can then submit his/her resignation and request the employer to cancel their current work pass.
- However, in the event that your employee is leaving the company to start their own business in Singapore, they will need to start the process of applying for that work pass before they resign.
Legal obligations
Tax matters
Foreigners who are no longer working in Singapore have to clear all the tax they owe before leaving the country. As an employer, you have to seek tax clearance on their behalf.
Here is what you need to do:
- Get in touch with the Inland Revenue Authority of Singapore (IRAS) and let them know that they should withhold all the payments due to you (the employer).
- This should be from either the day you terminate their employment or the day the employee hands in their resignation letter. The IRAS will then do an assessment and issue a tax clearance certificate. This certificate confirms that the employee has paid all their taxes that are due. You will have to pay your employee any money that is due to them.
A tax clearance certificate usually takes between a week to 21 days to be processed. Employees who attempt to leave the country before paying any overdue taxes may be stopped from doing so.
How to cancel a work pass
An employment pass can be canceled by logging in to the myMOM portland submitted up to 14 days in advance. But do note that the latest it must be canceled is one week after the employee’s last day of notice. If the employee is still going to be in Singapore for a short period before leaving the country, you may request for a 60-day STVP.
Be informed
Employers should be aware of their responsibilities to foreign employees at all times, especially with regards to the law. It’s also important to know what your obligations are before a retrenchment exercise takes place. Paying special attention to the processes involved with the relevant visas and employment passes are essential.
Sleek is able to take care of matters in this area so contact us today to find out more.
You might be interested in reading about:
