Changes to Singapore’s Work Injury Compensation Act in 2020 – What you need to know
In September 2019, Singapore passed a new Work Injury Compensation Act (WICA) which became active from the beginning of 2020. Singapore’s WICA aims to enhance protection measures for workers in Singapore by placing stricter requirements on both businesses and insurers.
Naturally, this leads to an increased compliance burden for businesses and insurers in the Lion City. In this article, our experts at Pacific Prime Singapore will take you through all you need to know about the 2020 amendments on WICA, highlighting the most important aspects that are most relevant for remaining compliant in Singapore.
WICA 2020 in brief
- Increased compensation and medical expenses limits
- Wider inclusion of non-manual employees
- Wider scope of compensation to include light duties
- Compulsory reporting for any instances of medical leave or light duties
As we can see, all these four key points have implications for businesses and insurers when it comes to staying compliant. In the following sections, we’ll take a deep dive into what these changes really mean for businesses, shedding light on how companies in Singapore can lower their compliant risks going forward.
Increased compensation for medical expenses limits
There are two key changes to the WICA’s workers’ injury compensation (WIC) details:
- Compensation for death
- Compensation for total permanent incapacity
Starting from January 1, 2020, both the minimum requirement and the maximum ceilings for these two compensation types will be raised as follows:
Compensation for death
|Test||Before Jan 1, 2020||From Jan 1, 2020|
|Minimum||SGD $69,000||SGD $76,000|
|Maximum||SGD $204,000||SGD $225,000|
Compensation for total permanent incapacity
|Test||Before Jan 1, 2020||From Jan 1, 2020|
|Minimum||SGD $88,000||SGD $97,000|
|Maximum||SGD $262,000||SGD $289,000|
Apart from these two changes, the maximum limit for medical expenses will also be increased from SGD $36,000 to SGD $45,000.
Wider inclusion of non-manual employees
Prior to the implementation of the WICA 2020 amendments, the law only applied to non-manual employees (NMEs) earning up to SGD $1,600 a month who are working in factories.
The new WICA will widen the inclusion of NMEs to encompass all NMEs, regardless of where they work. The salary threshold will also increase in two stages.
|Test||Stage 1 (April 1, 2020)||Stage 2 (April 1, 2021)|
|The salary threshold for NMEs||From SGD $1,600 to SGD $2,100||From SGD $2,100 to SGD $2,600|
Wider scope of compensation to include light duties
Employees who are assigned on light duties due to a work injury will be compensated for their lost earnings at the same level as employees who are receiving medical leave for the same reasons.
This measure has been primarily implemented to “address the concern that some irresponsible employers may attempt to influence doctors to under-prescribe medical leave or light duties,” said the Ministry of Manpower (MOM).
Compulsory reporting for any instances of medical leave or light duties
The MOM also mentioned concerns that some employers may avoid reporting accidents to minimize the number of paid medical leave days for employees. To address this, businesses will be required to report all medical leave or light duties to the MOM directly.
For businesses, this adds to the list of administrative duties that they are expected to perform while operating in Singapore. To help ease the administrative process of reporting medical leaves and light duties, the reporting requirements will be simplified for accidents that lead to less than four days of leave.
Furthermore, employees will also have the option to switch doctors to avoid any possible unfair or inadequate assessment by the employer’s doctor.
WICA 2020 implementation timeline
Not all chapters of the WICA amendments will be active since January 1, 2020. Like other major pieces of legislation, the WICA 2020 will have an implementation timeline which businesses will need to pay close attention to.
|Increased compensation limits||January 1, 2020|
|Wider inclusion of NMEs||April 1, 2020|
|Compulsory reporting of medical leave or light duty instances||September 1, 2020|
Insurer data disclosure and violation penalties
To ensure accurate premium pricing by insurers that provide WIC insurance, insurers will be required to share their policy and claims data with the MOM. Failure to do so will result in a maximum fine of SGD $5,000 and/or 6 months’ imprisonment for any person withholding the necessary information.
Penalties for businesses are also stated in the new WICA as follows:
- Failure to pay deposit compensation ordered will lead to a maximum fine of SGD $15,000 and/or 12 months’ imprisonment
- The maximum fine for non-or-late payment of compensation will be increased from SGD $10,000 to SGD $15,000
- A subsequent conviction for WICA offenses will double the maximum fine
How the WICA will impact your business
The WICA will likely benefit businesses in four ways, according to the MOM.
Firstly, the law will require all WIC insurers to be government-approved before being allowed to offer WIC policies to clients. This significantly lowers the chances of businesses purchasing poor-quality WIC policies from non-compliant insurers.
Secondly, the MOM will set strictly defined insurance terms and conditions so that businesses will not be denied reimbursements from unfair policy exclusions.
Thirdly, businesses with good safety records will pay lower premiums than others. This rewards businesses with strong injury prevention measures in the workplace.
Finally, businesses will now be able to seek recovery for full compensation even if they are subjected to error, false, or misleading information from insurers.
Get expert advice on business insurance in Singapore
If you have any further questions regarding business insurance or group medical insurance, feel free to contact our experts at Pacific Prime Singapore. We are a global health insurance broker with over 20 years of experience providing health insurance solutions for individuals and businesses throughout the world.
With our help, you will be informed of the latest developments in Singapore’s health insurance market. We are also able to provide you with free plan comparisons from leading insurers in Singapore. Visit our website for a no-obligation, free quote today!
In his free time, Phuwit enjoys reading and playing badminton. He also loves a good cup of coffee.
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