It is often acknowledged that employers, as managers of their employee’s livelihoods, should be held to a standard of care. As a result of their positions of authority, the expectations and responsibilities that sit heavily on their shoulders have been put there for good reason.
Recently, this message has been enforced by a case that came before an apex court. Here is what you need to know about the recent clarification on the standard of care an employer owes.
The Case in Question
On 27 July 2016, the Court of Appeal ruled that AXA Life Insurance Singapore had negligently breached its duty of care to “one of its best-compensated advisers”, Mr Ramesh Krishnan, and asked the High Court to determine the damages owed.
Mr Ramesh had left his financial service director post at AXA in 2011 and had applied to Prudential for a job. However, his application was refused when AXA declared he had a very poor rate of retaining clients and stated that it was “very concerned as to whether the clients had been provided with proper advice”.
It was found that the reference provided by AXA conflicted with descriptions of Mr Ramesh being a top representative of the company and the fact that it had earlier persuaded him not to resign.
As a result of being unfairly denied a job opportunity, Mr Ramesh took up a job at a vegetarian café instead. He began proceedings against AXA for defamation in 2015.
How Were Damages Calculated?
When calculating the damages to be paid in such a case, the court will seek to reimburse the victim with what he or she should have had if the unfair action had not taken place.
In this case, the High Court began by considering the employment package conditionally offered by Prudential. It then took into account amounts such as the commencement allowance and monthly salary for both the first twelve (12) months from April 2011 and subsequent months until July 2016. An estimate of the possible loss of earnings between August 2016 and July 2018 was also considered at a discounted rate.
To balance this, the High Court deducted from the above sum the salary Mr Ramesh had earned from his job at the vegetarian café.
Significance of The Case
This case clarifies the standard of care an employer is required to observe while providing a reference. Specifically, reasonable care should be taken by employers to meet requirements of truth, accuracy and fairness.
Otherwise, the employer may be found liable for negligence in breaching its duty to its employees.
This is especially relevant in industries such as the financial advisory and insurance industry, where references by former employers are a key part of the hiring process.
What Is an Employer’s Duty of Care?
In general, the law sees the duty of care towards a person as a presumed responsibility for him or her. For instance, road users owe other road users a duty to act in ways that do not endanger their safety.
With regard to the duty owed by employers to employees, the Ministry of Manpower aims to foster a respectful and fair working environment in Singapore. What is required of an employer or the standard of care expected, can thus be assumed to align with this goal.
The powers and responsibilities of an employer are laid out in Acts such as the Employment Act (Cap 91, 2009 Rev Ed) or Central Provident Fund Act (Cap 36, 2013 Rev Ed). There, limits are set to curb the abuse of power by employers. Otherwise, legislation such as section 5 of the Defamation Act (Cap 75) bars actions that may create unfairness for an employee in his or her professional life.
In the case in question, an example of an employer’s duty to its employee includes being honest and representative in references it prepares for the employee.
What is Negligence?
In civil cases, negligence refers to a form of a breach of a duty owed to a person. The person in breach may then be found liable for the appropriate penalties when the courts administer justice.
As opposed to deliberately and knowingly not fulfilling a responsibility owed to another, negligence means not taking the amount of care expected when acting. As a result, the action breaches a duty owed.
In the case in question, negligence arises in the way AXA fails to take reasonable care to ensure Mr Ramesh’s reference is accurate and honestly reflective of his work.
What Are General Employment Guidelines in Singapore?
For both employers and employees, it is important that you are aware of the guidelines that should be adhered to in an employer-employee relationship. Breaching a duty owed to an employee in the eyes of the law can lead to serious penalties.
Typically, the primary responsibilities of an employer are outlined in the Employment Act (Cap 91, 2009 Rev Ed) and Central Provident Fund (CPF) Act (Cap 36, 2013 Rev Ed). These Acts set out what is expected of employers, such as a duty to grant fair working hours and contribute to their employees’ CPF accounts.
Industry-specific regulations and duties may exist as well. You should consult a professional to be clear on your rights and the expectations put on you.
For more information and resources on employment rights, you may wish to click on the Ministry of Manpower’s WorkRight initiative page (http://www.mom.gov.sg/employment-practices/employment-act/workright).
Has My Employer or Former Employer Been Negligent?
If you suspect your employer has been negligent towards you, you should first identify what the scope of the duty owed to you is.
Indicators of this may be found in generally applicable guidelines for work practices provided by the Ministry of Manpower and, where applicable, an industry-specific regulatory authority. You should also read through your employment contract.
Following this, you should take note of what has happened that has given rise to your suspicion. Has your employer failed to do something with a reasonable amount of care such that you have suffered losses?
Figuring out whether you have a case and, subsequently, how to fight your case can be a confusing process. Where unsure, it is always best to consult an experienced lawyer who can point out what is important and advise you on the actions available to you.
What If I Am A Part-Time Worker?
The Employment of Part-Time Employees Regulations set out what you have a right to. Should an employer prove to be negligent in any of these aspects, you may be able to claim against your employer.
Where in doubt, you may wish to contact a lawyer for advice. Alternatively, you may lodge your case with the Ministry of Manpower through their WorkRight initiative.
What if I Am Exempted Under the Employment Act?
While the Employment Act covers most employees working under a contract of service with an employer, it does not cover:
- Managers and executives whose salary is more than S$4,500 a month
- Domestic workers
- Civil servants
The Act may also not apply to professionals with specialised knowledge and who carry out similar responsibilities to managers or executives, such as doctors.
If your case falls under one of the exemptions, but you wish to claim for an instance of unfair treatment from your employer, do seek immediate legal advice. Each circumstance is unique, and it is best you obtain the information you need from a professional
What If I Have Employment-Related Queries?
For any matter relating to employment laws or issues such as unfair termination, you may lodge a case via [email protected] or 1800 221 9922. For their online service, click on this link (http://www.mom.gov.sg/eservices/services/report-an-employment-act-violation). Information provided will be kept strictly confidential.
As a guide when lodging a case, you should prepare:
- A valid SingPass
- Details of your employer (e.g. company name, Unique Entity Number)
- Your personal particulars (e.g. address, NRIC, contact number)
- Your employment details (e.g. period of employment, salary)
You may also be required to submit documents to support your case and explain your situation. These documents include, where relevant:
- Your employment contract
- Payslips, CPF statement or bank statement
- Resignation or termination letter
- Timesheets or punch card
- Medical certificate or medical bill