Extending Obligation of Employment Agencies to Refund 50% of Service Fee for Premature Termination of Contracts with Foreign Domestic Workers

Foreign domestic workers (FDWs) play an important role in supporting families in their care-giving duties and domestic work. As it is costly and disruptive to families when they hire an FDW who is not able to meet their household needs, MOM recently announced a series of measures to better support employers in the hiring of FDWs.

Firstly, to improve the chances of employers being matched with FDWs who can meet their household needs, employers and employment agencies (EAs) will be able to obtain more information on the work experience of prospective FDWs from October 2020. This includes information on the FDW’s previous job scope, her former employer’s residence type and household size, and the reasons for the termination of her past employment contracts. In addition, EAs will also be able to have access to the profiles of FDWs hired by employers who had changed five or more FDWs within a span of 12 months. This will allow the EAs to better customise their services for these employers who may need more help in selecting FDWs, such as making house visits to find out more about the unique household needs of the employers and training the FDWs based on these needs.

Secondly, from October 2021, all EAs will be required to provide an option to refund at least 50% of the service fee charged to employers when the FDW’s contract ends prematurely within the first six months. This will encourage the EAs to improve their matching processes and take greater ownership in finding better matches for employers.

In general, six months is a sufficient period for an employer to determine if his/her FDW meets the household’s needs. MOM’s records show that the large majority of FDWs who worked for at least six months continued to stay with their employers beyond one year. Hence, beyond the initial six months of employment, it would not be fair to attribute the subsequent breakdown of the relationship to a poor match by the EA and could result in higher service fees for employers.

Lastly, despite best efforts to ensure a good match, there could invariably still be disputes between employers and their FDWs. Employers can now tap on the free dispute resolution services offered by the Centre for Domestic Employees (CDE) and Foreign Worker Association for Social Support and Training (FAST) to resolve their FDW issues.

The new measures will be rolled out progressively over the next two years to allow time for employers, EAs and FDWs to adjust to the changes. MOM will continue to work with the EA industry to facilitate improved matching outcomes for employers and FDWs.