What are your CPF rights and could you be exploited?


The following article has been submitted by Andy Tay

CPF, a form of “enforced savings” with the purpose of enabling Singaporeans to have a secure retirement, through lifelong income, healthcare financing and home financing.



Yes, I know, we do like our freedom to spend our money as we wish and having a lower pay check every month can be kinda irritating, but…I guess if it serves the longer term purpose, its bearable :)

So…as an employee, do you know about your rights to CPF and have you been exploited by your employer?

Read on for a real life story and learn from it to protect yourself and your loved ones!

In this story, the NTUC U Care Centre (UCC) was instrumental in assisting this lady in her situation. (The UCC is a recently formed centre by NTUC to champion the well-being of low-wage workers and provide employment and workplace advisory. )


The Current Situation:

Linda, 65, is currently working as a cleaning lady with a cleaning contractor.

She started this job in 2010. During the interview, the boss told her that if she accepted no CPF for this job, she could have a higher take-home pay. He was also quite keen for her not to accept the CPF.

As Linda really needed the job, she decided to accept this offer. In addition, she could take home $800/month instead of $640 (20% to CPF deduction) and the extra cash was very attractive. Linda had a son staying with her and had to help pay his medical bills every month.

The boss did not offer a contract of service and she was not entitled to annual leave, MC or other employment act benefits.

How Linda Found Out About UCC:

One day, Linda was mingling with her colleagues and they were talking about Workfare, a government scheme to assist lower income workers to continue working and training at the same time.

She realised she did not have Workfare and her colleagues gave her NTUC hotline number to call. When she called, she was transferred to the NTUC U Care Centre (UCC).

How UCC Assisted Linda:

During the initial conversation, Peishan was the representative addressing her query. In the beginning, Peishan was confused because all CPF contributing  employees are automatically enrolled into the Workfare scheme.

Linda told Peishan her current situation and that she actually approached her boss in 2012 about having her CPF back. However, she was told that if she insisted on having CPF, that she should resign instead. As Linda had no one else to advise at that time, she decided not to push for her case.

Now, given her current age of 65, she was hesitant to approach her boss again for fear of losing her job. It would be very difficult for her to find a new job.

Upon Peishan’s advice, Linda lodged a complaint with the CPF Board. After investigation, the CPF Board informed Linda’s employer that they were infringing the CPF Act.

The Result:

Linda’s employer compensated by paying Linda 3 years of CPF employer contribution amounting to $2940. They also gave her a pay rise of $50 to make it $850/month (before CPF contribution.

The good thing was that although she takes home less in cash, she can now use her CPF to pay for her rental home and partially pay her son’s medical bills. In addition, she qualifies for Workfare too.

Her employer also offered her a Contract of Service beginning in 2014 as an official employee. However, they did not compensate her for the 2010-2013 years of Annual Leave or Medical Leave.

Linda could have complained to the Ministry Of Manpower (MOM) about this and was advised the pros and cons of doing so by Peishan. The main con was that her employer could have terminated her contract and it would have been very difficult for her to find a job again at age 66 now in 2014.

So, the morale of the story? Make sure you know our rights, and if unsure, feel free to call upon the UCC anytime so they can advise you for your benefit!


Editors note: With legislation of the Progressive Wage Model, Linda will now have her salary lifted again to $1000 minimum by law. Also by law, her employer needs to factor in concerns such as: how to lift her salary progressively, justified by productivity. Her employer also has a variety of funds to tap on to achieve this.



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