Employer of Record (EOR) Services in Singapore Benefits

Singapore’s complex employment laws and payroll requirements can overwhelm businesses expanding into this strategic Asian market. Employer of Record (EOR) services in Singapore allow companies to hire employees legally without establishing a local entity, handling all compliance, payroll, and HR responsibilities on their behalf. This arrangement enables businesses to focus on their core operations while ensuring full compliance with local regulations.

Companies face significant challenges managing Singapore’s intricate tax obligations, Central Provident Fund (CPF) contributions, and employment regulations. The Ministry of Manpower enforces strict compliance standards, which can result in penalties for businesses that fail to meet local requirements. EOR providers eliminate these risks by serving as the legal employer, while the client company retains operational control over daily activities.

WRS offers comprehensive EOR solutions that streamline hiring and reduce administrative burdens for international businesses. The service encompasses everything from drafting compliant employment contracts to managing statutory contributions and handling employee terminations, enabling companies to efficiently test the Singapore market while maintaining flexibility for future growth.

Key Takeaways

EOR services enable legal hiring in Singapore without the need to establish a local business entity.
Professional EOR providers handle payroll compliance and statutory contribution requirements.
Outsourcing HR functions to qualified providers can significantly reduce risks and administrative costs.

Understanding Employer of Record (EOR) Services in Singapore

What Is an Employer of Record?

An Employer of Record (EOR) in Singapore is a local entity that hires and pays employees on behalf of other organisations, particularly foreign companies without a legal presence in the country. The EOR becomes the official employer under Singapore law, while the employee performs work on behalf of the client company.

This triangular arrangement ensures that the EOR holds the employment contract and manages all legal responsibilities, while the client company directs day-to-day work. The employee receives salary and benefits through the EOR.

EOR services typically include:

Payroll processing
Tax withholding
CPF contributions
Compliance with Singapore’s Employment Act

Recent policy changes issued by the Ministry of Manpower (July 2024) have impacted how EORs operate, particularly for hiring foreign workers when the company lacks a local presence.

Key Roles and Responsibilities of EORs

Legal Employment Duties:

Creating/managing employment contracts
Ensuring Employment Act 1968 compliance
Managing workplace safety under WSHA
Handling Work Injury Compensation

Payroll & Financial Management:

Monthly salary processing
Tax withholdings and submissions
CPF and Skills Development Levy contributions

Administrative Functions:

Onboarding
Leave and reimbursement processing
Record-keeping

Even when employees report directly to the client company, the Employer of Record (EOR) remains legally responsible for ensuring compliant working conditions and statutory benefits. While EORs have traditionally managed work pass applications, recent regulatory changes have introduced limitations in certain cases.

How EORs Operate in the Singapore Market

EOR services have long supported rapid market entry without the need for incorporation. Typically, client companies identify talent, while the EOR manages employment contracts and payroll compliance.

Common Use Cases:

Project-based staffing
Market entry without local incorporation
Compliance support for complex employment scenarios
Interim hiring during entity setup

New policies restrict EORs from applying for work passes for foreigners employed by overseas companies without a Singapore presence. The market is now shifting toward supporting companies with, or planning, a local presence.

Why Outsource Payroll and HR Functions to WRS

WRS provides end-to-end payroll management services that ensure compliance, automate routine tasks, and eliminate administrative overhead, freeing up your internal resources.

“WRS Singapore manages full end-to-end payroll services for our clients, including monthly salary processing, payslip issuance, provident fund contribution, and annual income tax filing. Our capability extends to the inclusion of medical insurance coverage. Our clients value our contribution to their manpower requirements and continue to engage our services due to our track record of reliability across all the aforementioned areas and our knowledge of ever-evolving local compliance requirements. Our dedicated contractor care team offers tailored solutions on an individual basis to meet the specific requirements of both the employer and employee.

Singapore remains an important global hub across many sectors, including energy, maritime transportation, finance, technology, healthcare, engineering, architecture, law and our local presence allows us to support our clients with their growing needs to hire professionals based in Singapore.”
– Charles Tissot, Director, Singapore

Advantages of Payroll Outsourcing

Outsourcing to WRS helps businesses:

Reduce payroll costs by up to 50% by streamlining administrative tasks, minimising compliance risks, and eliminating the need for in-house payroll systems, software, and staff.
Lower staffing/training expenses
Save up to 40 hours/month on administrative tasks
Avoid costly compliance errors

With access to multi-currency payroll experts, WRS ensures timely and accurate payroll processing in full compliance with Singapore law.

Streamlining Employee Onboarding and Offboarding

WRS digitises onboarding, from contract signing to CPF registration, before the employee’s first day.

Features:

Auto-generated compliant contracts
Bank account setup
Work pass support

Offboarding is a structured process, covering final pay, accrued leave, and proper documentation. Comprehensive recordkeeping supports audits and transitions.

Technology and Payroll Automation

WRS uses a cloud-based payroll platform that:

Automates complex payroll calculations, including statutory contributions like CPF (for Singapore), commissions, overtime, and deductions, helping reduce manual errors.
Provides real-time analytics and reporting tools for payroll, compliance, and workforce data, allowing for better decision-making and audit readiness.
Mobile-accessible portals where employees and contractors can submit timesheets, view pay details, and manage other self-service tasks.
Built to scale automatically, accommodating increasing users, clients, and payroll complexities as your business expands.

Ensuring Data Security and Compliance

WRS, together with our integrated payroll and HR software, ensures full compliance with the Personal Data Protection Act (PDPA) through:

End-to-end encryption
Multi-factor authentication
Secure data backups
Regular penetration testing

We also proactively monitor changes in employment law and automatically update our systems, helping businesses stay compliant effortlessly.

Key Benefits of Employer of Record Services in Singapore

Faster Market Entry and Scalability

Comparison:

Setup Method	Setup Time	First Hire	Key Considerations
Local Entity	2-12 months (average 3-6 months)	Post-setup (can take an additional 3-4 months for legal processes after initial registration)	Complexity: Requires navigating local laws, setting up payroll, banking, tax registration, and potentially a physical office. Cost: Significant upfront investment in legal fees, registration, office space, and ongoing administrative and compliance costs. Control: Offers full control over operations, culture, and compliance once established. Long-term commitment: Best for businesses with a long-term presence and high headcount planned for a specific market.
EOR Service	As little as 24 hours to 2 weeks	Immediate (can be onboarded within days or even hours)	Speed: Enables rapid market entry and quick hiring without the need for a local entity. Compliance: EOR handles employment compliance, taxes, payroll, and benefits according to local laws. Flexibility: Ideal for testing new markets, short-term projects, or hiring a small number of employees. Cost-effective: Reduces upfront and ongoing operational costs associated with entity setup. Risk Mitigation: Transfers employer-related liabilities and compliance risks to the EOR.

Cost Effectiveness and Resource Optimisation

Cost Comparison:

Cost Comparison (Example for Singapore – illustrative figures based on common estimates)

Expense Type	EOR	Local Entity (Singapore)	Notes
Setup Cost	SGD 0 – SGD 2,700 (Typically no setup fees, but some may charge onboarding/registration fees)	SGD 54,061+ (Includes government fees, nominee director, company secretary, registered address, potential security deposit)	EOR setup fees are generally minimal or non-existent, focusing on service fees per employee. Local entity setup involves various government fees and required services, like a nominee director and company secretary.
Annual Operating Cost	EOR Fee + Statutory Costs (EOR fee typically SGD 400-800 per employee/month or 10-18% of salary in Asia-Pacific, plus local taxes, benefits, etc.)	SGD 69,776+ (Includes ongoing costs for nominee director, company secretary, annual filings, taxes, accounting, and potential office rental)	EOR fees cover payroll, compliance, benefits administration, and HR support for the EOR’s employees. Local entities incur ongoing costs for compliance, administration, and potentially office space and infrastructure.
Total Year-One Savings	Potentially significant savings, often over SGD 100,000+, compared to entity setup.		EORs allow for leaner operations, avoiding the high upfront and ongoing costs of maintaining a local entity.

Compliance With Local Labour Laws and Regulations

EOR providers like WRS handle:

CPF contributions (7.5%–17%)
Employment contracts (issued within 14 days)
Working hours (standard 44-hour week)
Leave entitlements (annual, maternity/paternity, sick)

They ensure all records comply with ACRA retention rules and the Employment Act, protecting clients from penalties, up to SGD 10,000 per CPF underpayment.

Payroll Compliance and Statutory Contributions

CPF Contributions (by age):

<55 years: 37% (17% employer, 20% employee)
55–60: 26%
60–65: 16.5%
65: 12.5%

EORs also manage Skills Development Levy (SDL) and Foreign Worker Levy, calculated based on salary, sector, and dependency ratios.

Submission Deadlines:

CPF: 14th of the following month
Income Tax: Feb 28 (IR8A, IR8S, IR21)

WRS ensures full compliance, avoiding penalties of up to SGD 500 plus 5% monthly interest.

Work Injury Compensation Act Compliance

EORs manage all obligations under WICA, including:

Medical and hospitalisation expenses
Loss of earnings
Permanent incapacity payouts
Death benefits

WRS ensures claims are reported and managed within 10 days, meeting all MOM regulations.

Hiring and Managing Employees via an EOR in Singapore

Hiring Process and Work Permit Management

WRS EOR services include:

Drafting compliant contracts in 1-2 days
Processing Employment Pass, S Pass, and other permits
Ensuring legal hiring under EFMA
Managing probation periods and employment records

Employee Benefits Administration

WRS ensures statutory benefits such as:

CPF contributions
Annual leave (14 days)
Public holidays (11 days)
16 weeks’ maternity leave
14 days paid sick leave (+46 hospitalisation days)

Additional benefits and insurance can be tailored through WRS platforms with full PDPA compliance.

Supporting International and Remote Teams

WRS supports:

Global hiring across 150+ countries
Multi-currency payroll
Onboarding
Centralised workforce management
Integrated local holiday/time zone tracking

Selecting the Right EOR Service Provider for Your Business

Factors to Consider

Deep knowledge of Singapore’s Employment Act
Industry-specific expertise
Strong client references and case studies
Insurance and worker classification safeguards

Evaluating Service Offerings and Technology

Key WRS offerings:

Area	Features
Payroll Management	CPF, taxes, and salary processing
Benefits Admin	Insurance, leave tracking, and bonus handling
Compliance	MOM filings, work pass renewals
Onboarding	Contracts, training, documentation

Look for systems that integrate with your existing tools and offer employee self-service portals.

Importance of Transparency and Local Expertise

WRS offers:

Transparent pricing
Local employment law knowledge
Bilingual support
Relationships with MOM and other agencies

A local presence ensures fast response, cultural understanding, and seamless issue resolution.

Ready to Simplify Payroll and Expand in Singapore with Confidence?

Partner with WRS for seamless Employer of Record (EOR) services and payroll management tailored to your business goals. Our experts ensure full compliance with Singapore’s complex regulations, so you can focus on growing your team, not managing red tape.

Frequently Asked Questions

What are the benefits of payroll outsourcing services?

Outsourcing payroll services offers several key benefits for businesses of all sizes:

Cost Savings
Companies can reduce costs associated with hiring in-house payroll staff, purchasing software, and managing compliance risks. Outsourcing eliminates the need for training, system updates, and overhead related to payroll operations.
Time Efficiency
Payroll outsourcing frees up valuable time, often up to 40 hours per month, that internal teams can redirect toward core business functions such as strategy, growth, and client service.
Regulatory Compliance
Outsourced providers stay up to date with ever-changing tax laws, labour regulations, and statutory requirements. This ensures accurate CPF contributions, income tax withholdings, and labour law compliance, reducing the risk of penalties.
Accuracy and Reliability
Payroll firms use automated systems to process salaries, generate payslips, and calculate benefits, minimising human error and ensuring timely payments.
Data Security
Reputable payroll providers implement robust security measures such as data encryption, secure backups, and compliance with data protection laws like Singapore’s PDPA.
Scalability
As your business grows, an outsourced payroll solution can easily scale with your workforce without requiring new infrastructure or systems.
Employee Satisfaction
Employees benefit from timely, accurate salary payments, easy access to payslips, and transparent handling of benefits, contributing to higher morale and trust.
Access to Expertise
Payroll outsourcing providers bring deep knowledge of local regulations, tax systems, and industry-specific requirements, reducing the need for in-house expertise.

What are the benefits of employer of record services?

Employer of Record (EOR) services offer a range of advantages for companies looking to hire internationally or expand into new markets like Singapore:

Faster Market Entry
EORs enable businesses to legally hire employees in new countries, like Singapore, within days, without setting up a local legal entity. This speeds up market testing and team deployment.
Compliance Assurance
EOR providers take full responsibility for compliance with local labour laws, tax codes, statutory contributions (e.g., CPF), and employment regulations, minimising legal risk.
Reduced Administrative Burden
The EOR handles all HR-related tasks, including payroll, onboarding, contract management, benefits administration, and terminations, allowing your team to focus on operations.
Cost Efficiency
Companies save significantly by avoiding incorporation costs, legal fees, and the overhead associated with setting up and maintaining a foreign subsidiary.
Simplified Global Hiring
EOR services support hiring across multiple countries through one central platform, ideal for managing international and remote teams.
Legal Employment for Foreign Workers
In countries like Singapore, EORs help navigate complex work permit and immigration processes, ensuring that foreign hires are legally employed.
Local Expertise and Support
EOR providers have in-depth knowledge of local market practices, cultural norms, and regulatory frameworks, ensuring smooth employment operations.
Flexibility and Scalability
EORs are ideal for temporary projects, pilot teams, or phased expansions. Companies can scale their workforce up or down without long-term commitments.

What are the advantages of EOR?

Enables fast and legal hiring without establishing a local entity
Ensures full compliance with local labour laws and tax regulations
Reduces administrative workload related to HR, payroll, and onboarding
Lowers costs associated with entity setup and ongoing legal maintenance
Provides access to local market expertise and regulatory updates
Supports scalability for short-term projects or global expansion
Manages work permits and employment contracts for foreign hires
Centralises payroll and compliance across multiple countries

When should you outsource payroll?

You should outsource payroll when managing in-house becomes time-consuming, error-prone, or non-compliant with local regulations. It’s especially beneficial during business expansion or when hiring in new markets like Singapore.

What’s the real impact of Employer of Record (EOR) services on employee experience and retention in global companies?

EOR services enhance employee experience by ensuring timely payroll, compliant benefits, and smooth onboarding across regions. This consistency builds trust and satisfaction, leading to improved retention in global teams.