The government has announced that it will make the first payment of Temporary Employment Credit (TEC) to over 169,000 employers by 30 October.
The TEC has been offered to help employers cover higher costs stemming from a 1 percentage point increase in Central Providence Fund (CPF) contribution rates to employee Medisave Accounts which took effect from 1 January 2015.
The government has extended the TEC until the end of 2017, giving employers support when adjusting to the higher CPF salary ceiling and the 1% increase of employer CPF contribution rates for older workers in 2016.
The TEC will be paid twice yearly in April and October to employers that have eligible staff on the payroll between January 2015 and December 2017.
Details of the TEC enhancements are as follows:
- In 2015, a TEC of 1% of wages up to the CPF salary ceiling of S$5,000
- In 2016, a TEC of 1% of wages up to the CPF salary ceiling of S$6,000
- In 2017, a TEC of 0.5% of wages up to the CPF salary ceiling of S$6,000
By 30 October, the government will pay employers a total of S$356 million in TEC for costs incurred in the period of January to June 2015.
In total, the TEC is expected to cost S$1.7 billion over the three years it is applicable.
The CPF board will assess employers for their eligibility based on their regular monthly CPF contributions. Those who are deemed eligible will be notified from 6 October.
Related stories:
Singapore HRDs: claim up to $33,600 in wage subsidies
Deputy PM announces $3million employee grants
Employers to get $15,000 to take on apprentices
