Employment Claims Tribunal – What Does This Bode?

As of 1 April 2017, the Employment Claims Tribunal (ECT) has been convened to replace the Labour Court in adjudicating statutory and contractual salary-related disputes up to a claim limit of S$20,000*.

The ECT does not have jurisdiction to handle non-salary related claims (e.g. claims in relation to non-compete / confidentiality clauses).

Employment claims in the ECT will be heard by legally qualified Tribunal Magistrates in accordance with Singapore court processes.

Parties will not be allowed to be legally represented in the ECT proceedings itself, although there is no restriction against parties seeking legal advice on the matter. For instance, lawyers will be able to assist in advising on the merits in advance of the hearing but will not be present at the hearing.

If the employee is still employed by the company, the claim must be brought within 1 year after the dispute arose. Otherwise, within 6 months from the last day of work.

Looking at the setup of the ECT, in our view, its aim is to encourage parties to focus on a commercial resolution (at least for claims below S$20,000*) which may not have a direct co-relation to the merits of each party’s position, although being aware of the relative merits may facilitate the process of reaching a compromise in certain cases.

*A higher claim cap of S$30,000 would apply to cases that have undergone a formal mediation process either through the Tripartite Alliance for Dispute Management (“TADM”) or mediation assisted by unions recognised by the Industrial Relations Act. If the claim exceeds the maximum amount, the excess amount will have to be foregone to be able to enter into a settlement agreement or to enable the case to be heard by the ECT.

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