Hiring Staff to Deploy to Your Clients: An Employer of Record Guide for Singapore

By Jonathan · Singapore employer guide

If you hire Singapore Citizens or PRs on your own payroll and deploy them to work for your clients, you can usually run this model without an employment agency licence. In return, every employer duty stays with you, even though your staff spend their days at someone else’s office.

This model goes by many names: employer of record, staff outsourcing, contract staffing or manpower services. The setup is the same. Your company hires the employee, pays their salary and CPF, and bills a client for the employee’s services.

This guide is for founders and business owners weighing that model, especially in IT, tech and professional services. It covers when you need a licence, the duties you can’t hand over, the real cost of each hire, the tax position, and how to structure your client contracts.

Do you need an employment agency licence?

Usually not, as long as the staff are genuinely your employees. MOM’s guidance on who needs an EA licence lists two activities that don’t need one:

• Outsourcing your own staff to your customers’ premises or offices.
• Recruiting people solely to employ them in your own business.

The exemption rests on the words "your own staff". You will need a licence if your activity is really placing jobseekers with other employers, for example:

• The client picks the candidate and becomes the employer, and you collect a placement fee.
• You process job applications or collect resumes on behalf of clients.
• You submit work pass applications for other employers as part of matching or placement work. MOM lists a separate exemption for organisations that only submit work pass applications and do no matching or placement.

This guide focuses on Singapore Citizens and PRs. Do not assume the same model is available for work pass holders. Supplying them solely to supplement another company’s workforce is generally not allowed. MOM’s EA Alert 05/2024 says labour supply of foreign employees is only permitted in the construction and process sectors, or with MOM’s express approval. Breaches can bring fines of up to $30,000, imprisonment, or both.

This is different from delivering your company’s own services at a client’s premises. MOM allows that under a contract for service if the work matches the occupation and sector on the pass, the activity matches your declared business, and your company remains the employer, directly supervises the work and pays salaries. See MOM’s client-site deployment conditions.

You are still the employer, wherever your staff sit

You can’t deploy staff to a client and leave the client to manage them. Your duties under the Employment Act, CPF Act, Work Injury Compensation Act and Workplace Safety and Health Act stay with you. A contract with the client doesn’t move them.

It matters for two reasons:

• You stay liable. If salary is paid late, leave is denied or CPF goes unpaid, MOM and CPF Board come to you, not your client.
• Your licence exemption depends on it. If the client hires, directs, disciplines and effectively employs the staff while you only run payroll, the arrangement looks like job placement. The actual working relationship matters, so get advice if your company’s role is limited to payroll administration.

The Tripartite Advisory on Best Sourcing Practices from MOM, NTUC and SNEF sets out the same expectation. The service provider complies with employment law, issues key employment terms and payslips, pays on time, and provides tools and training. The client pays promptly, provides on-site facilities, and meets its own safety duties.

Workplace safety is shared. Under the WSH Act, you must assess risks and give your staff enough instruction, training and supervision. The client, as occupier, must keep its premises safe. If the client directs how the work is done, it takes on employer-level safety duties as well (MOM: WSH responsibilities).

Your ongoing employer duties

These duties apply to every deployed employee, whether they work at your office or a client’s.

The biggest commercial risk is the end of a client contract. When a client contract ends, your staff are still your employees. You must redeploy them, give proper notice, or retrench them responsibly. Plan for this before you sign.

What a local hire really costs

For a Singapore Citizen or third-year PR aged 55 or below, with monthly wages above $750 and within the CPF wage ceilings, employer CPF adds 17% to wages, with SDL on top. Insurance, benefits, paid leave and bench time increase the total further; price these from your actual employment terms and insurance quotes. There is no foreign worker levy for Singapore Citizens or PRs.

Employer CPF. These are the rates from 1 January 2026 for Singapore Citizens and PRs from their third year, earning more than $750 a month (CPF Board):

In 2026, CPF is payable on monthly ordinary wages up to $8,000. The additional-wage ceiling is $102,000 less the ordinary wages subject to CPF for the year. PRs pay lower, graduated rates in their first two years, unless employer and employee jointly choose full rates.

Other costs to budget for:

• Skills Development Levy: 0.25% of monthly total wages, minimum $2 and maximum $11.25 per employee.
• Work injury compensation insurance: compulsory for some staff (see above), and sensible for all.
• Medical and hospitalisation: consultation fees for sick leave, plus any group insurance you offer.
• Paid time off: Statutory annual leave starts at 7 days and rises to 14 with service, subject to eligibility and pro-rating. Eligible staff with at least 6 months’ service receive up to 14 days of outpatient sick leave and 60 days of hospitalisation leave; the 60 days include the 14 outpatient days. Also budget for 11 paid public holidays and any applicable family leave.
• Bonus and increments: a 13th-month bonus isn’t mandatory, but clients and candidates often expect one.
• Bench time: salary paid between client contracts.

Worked example. A Singapore Citizen aged 30, earning $5,000 a month:

The employee’s own 20% CPF ($1,000) comes out of the $5,000, so it isn’t an extra cost to you. Price your client fees above this figure. Your margin also has to cover insurance, admin, bench time and your profit.

Tax: what applies to you and your employees

For most of these businesses, the main tax points are corporate tax on chargeable income, GST registration when the compulsory-registration tests are met, and annual employee income reporting.

For your company

• Corporate income tax is 17% of chargeable income, before any tax exemptions/reliefs applicable. Salaries, statutory employer CPF and SDL are generally deductible when incurred in producing income. Insurance and medical-benefit deductions depend on the policy and applicable limits. See IRAS business-expense rules.
• GST registration is generally compulsory if taxable turnover exceeds $1 million in a calendar year, or is reasonably expected to exceed $1 million in the next 12 months. Check IRAS’s retrospective and prospective tests, including application deadlines and exceptions. Once GST-registered, local staff-service supplies are generally standard-rated at 9%. A GST-registered client may recover input tax subject to the usual conditions. An overseas client does not automatically make the supply zero-rated; the international-services conditions must be met.
• Employee income reporting. Prepare the required employment-income records by 1 March of the following year. AIS employers submit electronically to IRAS; employers outside AIS provide Form IR8A and applicable appendices to employees. See IRAS employee-income reporting.

For your employees

• Singapore generally does not require monthly income-tax withholding for resident employees, although tax clearance can require you to withhold monies. Employees must check their filing obligations; some qualify for the No-Filing Service. Resident individual tax rates are progressive, from 0% to 24%.
• Mandatory employee CPF contributions reduce take-home pay and generally qualify for CPF tax relief within the applicable limits. The contribution rate depends on age, PR year and wages; it is not always 20%.
• Benefits in kind, such as housing or a car, are generally taxable and must be reported.

Getting the client contract right

Your client contract should make clear that you employ the staff and the client directs only the day-to-day work. Make sure it covers these points:

1. Who controls what. You handle hiring, salary, leave approval, performance reviews and discipline. The client assigns tasks and supervises the work.
2. Workplace safety. The client keeps its premises safe, briefs your staff on site rules, and reports incidents to you straight away.
3. Indemnities. Each party covers losses from its own breaches. That includes the client’s safety lapses and your employment law obligations.
4. Notice period. Ask for at least 3 months’ written notice before the client ends or scales down the contract. The Tripartite Advisory recommends this, and it gives you time to redeploy or properly end employment.
5. Non-solicitation. Decide whether the client may hire your staff directly. If you plan to charge a conversion fee, see the FAQ below first.
6. Payment terms. Payment should arrive before your payroll date, because you pay salaries on time whether or not the client has paid you.
7. Confidentiality and IP. Make sure work your staff produce for the client belongs to the client, and that your employment contracts support this.

Frequently asked questions

Can I hire foreigners on Employment Passes and deploy them to clients? Not simply to supplement the client’s workforce under this staffing model. Delivering your company’s own services at a client’s premises can be permitted if MOM’s occupation, sector, business-activity, supervision and salary conditions are met. Labour supply has separate restrictions; an EA licence alone does not authorise it.

Can my client manage the employee day to day? Yes, for the work itself. Pay, leave, discipline and employment decisions must stay with you.

What happens to my staff if a client contract ends? They remain your employees. You can redeploy them to another client, keep them on the bench, or end their employment with proper notice.

Do I need an EA licence to charge a conversion fee when a client hires my employee? It depends on how the arrangement works. If the fee is really for finding candidates for the client, it may count as placement work. Get advice before adding this to your contracts.

Does the client have any obligations to my staff? Yes. As occupier, the client must keep its premises safe. If it directs how the work is done, it can take on employer-level safety duties.

How Assembly Works can help

Assembly Works runs payroll, CPF, HR and tax compliance for businesses that deploy staff to clients. Assembly Works HR Pte Ltd holds MOM employment agency licence 22C1133. We can help you assess when your model may involve licensable work. We can help you:

• Check whether your business model needs an EA licence.
• Cost each hire and set your client pricing.
• Run monthly payroll, CPF, SDL and year-end income reporting. See why outsourcing payroll makes sense.
• Draft employment contracts, key employment terms and HR policies.
• Handle GST registration, bookkeeping and corporate tax.

Contact our team to talk through your setup, or explore our payroll and HR administration services.

This article is general information as of October 2026, not legal or tax advice. Rules change, so please get advice on your specific arrangement.

Sources

• MOM: Who needs to get an EA licence
• MOM EA Alert 05/2024: Provision of labour supply services
• Tripartite Advisory on Best Sourcing Practices
• MOM: WSH Act responsibilities of stakeholders
• CPF Board: How much CPF contributions to pay
• MOM: Retirement
• MOM: Workplace Fairness Act implementation target
• MOM: Work injury compensation insurance