In brief

Effective 1 September 2023, any person who enters into a contract for service to supply employees to a principal¹ (“Labour Contractors“) will be entitled to certain protections and subject to obligations under the Employment Act 1955 (EA).

Background

Previously, other than the agriculture sector, Labour Contractors were exempted from sections 31, 33A, 69 and 73 of the EA pursuant to the Employment (Exemption) Order 2012. However, effective 1 September 2023, the 2012 Order was revoked, which effectively means that the four provisions above will now be applicable to Labour Contractors in all sectors.

The four provisions are:

• Section 31 relating to priority of wages and amounts due to Labour Contractors over other debts owed to secured creditors or debenture holders
• Section 33A relating to keeping of information of the supply of labour
• Section 69 on the Director General of Labour’s (DGL) power to inquire into complaints
• Section 73 relating to the DGL’s power to make prohibitory orders to third parties, in relation to sums owed to the Labour Contractors by any liable person.

This Alert focuses on some of the salient rights and obligations of Labour Contractors due to this change.

Key provisions

Information relating to supply of employee (Section 33A)

All Labour Contractors are now required to:

• Register with the DGL within 14 days before supplying or undertaking to supply an employee
• Enter into a contract in writing for the supply of any employee
• Maintain a...

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