Around the age of 18, every male citizen of Singapore is enrolled into National Service (NS) and undergoes a two-year military training period. Men who have completed their full-time NS become National Servicemen (NSmen). From here NSmen form the ranks of Singapore’s Operationally Ready National Servicemen (ORNS) and are required to undergo regular ORNS activities. Such employees are liable to be called up for a maximum of 40 days NS every year.
An employee may not be dismissed on account of being called up for NS. Employers are also required to grant NSmen a leave of absence to complete their annual NS, which will have an impact on their regular remuneration.
Please note: under the Enlistment Act, when an employee is away from work performing ORNS activities, CPF contributions are unaffected, and the full amount remains payable at the usual rate for the employee.
NSmen receive two types of NS pay during ORNS activities:
- Service Pay – based on the NSman’s rank and vocation for the training. It will be pro-rated based on the duration of the ORNS activity in which the employee participates.
- Make-Up Pay – any loss in civilian income suffered by an NSman is claimable as Make-Up Pay from the Ministry of Defence (MINDEF), the Singapore Police Force (SPF) or the Singapore Civil Defence Force (SCDF). Note: Make-Up Pay is claimable only if there is an overlap between the NSman’s civilian working hours and the NS training. Any loss of income suffered outside the duration of ORNS activities will not be compensated by MINDEF.
The two options for employed NSmen to claim Make-Up Pay are discussed below. For self-employed NSmen, please refer to NS Matters.
Non-Direct Reimbursement to Employers of Claims for National Service Training (NON-DIRECT)
Non-Direct NSmen Pay refers to NSmen Pay that is paid directly to an employee. This amount is excluded from an employee’s gross salary but is still subject to CPF contributions.
If you have employees who receive their NSman Pay directly, you can indicate this on SimplePay by following the steps below:
Go to an employee’s profile and click on Add next to Regular Inputs. Select the NSmen Pay (non-DIRECT) item, under Income. Enter an amount into the Amount field. Please note: This amount will be subject to CPF deductions. You can also edit or delete this amount by clicking on the NSmen Pay (non-DIRECT) item on the payroll page of an employee’s profile.
If the Employee is reimbursed by MINDEF, SPF or SCDF directly checkbox is NOT selected:
- The NSmen Pay amount will appear on the employee’s payslip and will be reported on the IR8A form under item A (gross salary).
If the Employee is reimbursed by MINDEF, SPF or SCDF directly checkbox IS selected:
- The NSmen Pay (non-DIRECT) amount will appear on the employee’s payslip but will not be included in the IR8A report under item A (gross salary).
Once you are done, click Save.
Direct Reimbursement to Employers of Claims for National Service Training (DIRECT)*
The employee continues to receive his usual salary from the employer in accordance with the ordinary pay schedule for the duration of his NS activities.
The employer then claims back from MINDEF, SPF or SCDF the amount of NS Pay to which the employee would be entitled. The employer will need to submit the employee’s Make-Up Pay claim at least 14 days before their ORNS activity in order for MINDEF to credit the employee’s Service Pay to the employer. If the Make-Up Pay claim is not submitted on time the Service Pay will be credited directly to the employee. The employer may then recover this amount from the employee.
Since you are continuing to pay the employee his usual salary, there are no changes required when processing payroll. There is currently no system leave type available for National Service, but you can create a custom leave type if you want to keep track of the leave days taken.
*Note: before you can file claims on behalf of your employees, you will need to register with the Direct Reimbursement to Employers of Claims for NS Training (DIRECT) scheme.
Payment to NSmen by MINDEF, SPF or SCDF
If an employer is not registered with the DIRECT scheme, either the employer or the employee will need to initiate the Make-Up Pay claim process. This can be done via Manage NSmen Payments on the NS Portal. The employer can certify an employee’s Make-Up Pay claim and submit it to MINDEF who will reimburse the employee directly. MINDEF, SPF or SCDF will credit the Service Pay directly to the employee.
Employers will need to deduct the Make-Up Pay amount from the employee’s salary. Make-Up Pay claims need to be submitted at least 2 weeks before the ORNS activity begins and within 3 months from the payment of Service Pay.
Variable income components such as transport or meal allowances can be claimed if they are:
- Received on a regular basis for at least 4 out of the preceding 6 months before the ORNS activity
- Taxable and subject to CPF contribution
- Included in the employee’s employment or service contract
Before submitting a claim, please make sure you have all the necessary Supporting Documents.
Please note: the employer has to pay CPF contributions based on the wages given by the employer, together with the Make-Up Pay (i.e. loss in civilian income inclusive of variable wage components like overtime pay and commission) paid by MINDEF. The employer has to bear the full employer’s share of CPF contributions but can recover the full employee’s share from the employee’s wages.
When MINDEF reimburses an employee directly, the employer is required to deduct this amount from the employee’s salary. To do this, you can create a Custom Deduction Item for the amount of Make-Up Pay that the employee will receive due to their National Service. This will ensure that SimplePay calculates and deducts the correct CPF contributions based on the employee’s normal salary.
More information on how to create Custom Items can be found here.
As mentioned above, there is currently no system leave type for National Service; however, you can create a custom leave type.
Please ensure that you do not select unpaid leave when setting up your custom NS leave item as the aforementioned Custom Deduction Item already caters for the pay changes necessary for your employee.
More information on how to create Custom Leave Types can be found here.