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How to Set Up a Recruitment Agency in Singapore

Published on October 16th, 2015 by in Blog

A recruitment agency has one primary purpose: to place eligible job seekers with suitable employers. Acting as the middle party between potential employees and employers, these agencies may work with local or foreign candidates. There are ample opportunities for recruitment agencies to grow and thrive in Singapore, but all agencies must meet certain requirements before they can legally open for business.

An Employment Agency License, or EAL, will be required, and there are few steps that potential agencies must complete before applying for a license. The guide below will walk you through each step.

Do You Need an Employment Agency License?

Any entities that engage in employment agency services in Singapore must obtain an Employment Agency License. These services include:

  • Collecting resumes from active job seekers.
  • Discussing job applications with potential job candidates.
  • Filing applications for Singapore Work Visas on behalf of candidates or employers.
  • Placing potential candidates with employers.

This license will be required regardless of where the agency is based (Singapore or overseas) and whether it deals with jobs overseas or in Singapore.

An EAL will not be required if the agency is not involved in the job placement process or does not have a substantial influence on the outcome of the terms and conditions of employment. Examples of such entities include:

  • Online job boards and portals.
  • Individuals who provide casual or informal job referrals.
  • Placement divisions of autonomous universities.
  • Couriers used in job placement or recruitment activities.
  • Agencies that pair tuition teachers with students.

If you’ve determined that you do need an EAL, follow the steps below to set up an employment agency in Singapore.

1.     Register a Singapore Company

The first step is to incorporate as a Singapore company. When doing so, you will need to choose the appropriate business code for the type of recruitment you will be performing.

2.     Meet Personnel Criteria

All personnel and key appointment holders must be one of the following:

  • Singapore citizen
  • Permanent resident of Singapore
  • A foreigner who holds a valid Singapore work visa

All personnel must also be free of court convictions and bankruptcy.

3.     Establish an Office

Next, you will need to establish a business office for your agency. Please note that if you plan on making any renovations or additions to the space, the project will need to be approved by the Urban Redevelopment Authority of Singapore.

Before you can display a sign on your office, you will need to obtain approval from the Building and Construction Authority.

4.     Personnel Certification

All employees (temporary, permanent or contractual) and key appointment holders of an agency with a Comprehensive License must become certified under the Certificate for Employment Intermediaries program.

All key appointment holders will be required to attend a 40-hour course, while all other agency personnel will only be required to attend a 32-hour course. Key appointment holders must obtain certification regardless of whether they engage in employment agency activities or not. Other agency personnel will only need to obtain certification if they will be performing agency-related work.

5.     Apply for an Employment Agency License

Once you have incorporated and established a business office, you can apply for an Employment Agency License. When applying, you will need to choose either a Comprehensive License, or a Selective License.

  • Selective License: For agencies that place either local or foreign job seekers and earn a base salary of S$7,000 or more.
  • Comprehensive License: For agencies that do not qualify for a selective license.

The license will be issued by the Ministry of Manpower in Singapore. An application fee of S$400 is required.

It takes approximately 1-3 weeks for license applications to be processed. Once your application has been reviewed, you will be notified via email. If approved, an IPA (In-Principle-Approval) letter will be attached to the message.

Upon receiving the letter, you will be required to submit the following documents before being issued a license:

  • A copy of your agency’s business profile from SCRA
  • A copy of your Singapore ID or Employment Pass
  • Recent photo (passport size)
  • If operating under the HomeOffice scheme, a copy of the approval letter from the relevant authority
  • Copy of the certificate acknowledging that you passed the Certificate for Employment Intermediaries program
  • Copy of the IPA letter
  • Completed checklist
  • Any other documentation requested in your IPA letter

Once all documents have been submitted, you should receive an email within 7 days notifying you that your application has been approved. A fee of S$100 will then be required, and the license will be mailed to your address.

All Employment Agency Licenses are valid for up to three years and can be renewed.

If, for some reason, your application is rejected, you may submit an appeal letter within 30 days. The appeal will be reviewed by a senior officer, and it may take up to two weeks to receive a response. Additional documents may be requested to support your application.

Provided you have met all of the requirements and submitted all of the appropriate paperwork, there should be no reason for your application to be rejected.

6.     Pay the Security Deposit

Employment agencies will be required to pay a security deposit after receiving their license. Those who hold a Selective License must pay S$20,000, and the deposit must be furnished in the form of a Banker’s Guarantee. Those with a Comprehensive License will pay between S$20,000 and S$60,000 depending on the agency’s track record and placement volume.

7.     Register Personnel

All agency personnel who will be performing recruitment-related work will need to register with the Singapore Ministry of Manpower and obtain a registration card. This is a requirement for all agencies regardless of whether they have a Comprehensive or Selective license.

Employees can only be registered and work for one employment agency at a time. If an employee wishes to leave one agency and join another, they must de-register and reapply under the new agency. A one-time, non-refundable fee of S$160 is required for registration.

Registration will not be required for agency personnel and key appointment holders who will not be conducting any recruitment agency related activities.

 
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