"Contract for Service" or "Contract of Service"?

2026-04-28

What is the difference between "Contract for Service" and "Contract of Service" in Singapore?

There was a news story in Singapore: a lorry driver, due to signing the wrong contract, was treated as self-employed, resulting in 15 years of unpaid CPF contributions by different employers. Fortunately, after seeking help from MOM, he successfully reclaimed 130,000 SGD in CPF savings.

In English, the difference between a "contract for service" and a "contract of service" is just one word, yet the related benefits and rights differ significantly.

The Definition of Contract of Service by MOM

A contract for service is an agreement signed between an employer and an employee, where one party agrees to employ the other as an employee, and the other party agrees to become their employee and serve them. The employer must contribute to the employee's CPF and provide statutory benefits, such as annual leave and sick leave.

The Definition of Contract for Service by MOM

A contract for service is an agreement where an independent contractor, such as a self-employed individual, partner in a partnership, or sole proprietor (e.g., taxi drivers, freelancers, coffee shop vendors, insurance/real estate agents) performs a task or project for a company in exchange for payment. Since there is no employment relationship between the parties, the service provider is not protected under the Employment Act.

According to the regulations of MOM, there is no single definitive test to distinguish between contract for service and contract for service. Factors to consider when determining an employment contract include:

Control

• Who can decide on hiring and firing employees?

• Who pays the employee's salary? What is the method of salary payment?

• Who determines the production process, timeline, and methods?

• Who is responsible for providing the work?

• To what extent is the work of employees controlled and supervised?

Ownership of Work Factors

• Who provides the tools and equipment?

• Who provides the workplace and materials?

Economic Considerations

• Is the person conducting business for himself or for his employer?

• Can the individual share in any profits, or is he responsible for any loss risks?

• How to calculate the individual's income and the benefits obtained?

• Does this person have the authority to "price" or evaluate the work?

Established in 2013 and officially registered with the Ministry of Manpower, Singapore Skyline Business is your trusted partner for work pass and PR applications. Our experienced team specializes in EntrePass, S Pass (SP), Work Permit (WP), PEP,ONE pass,self-employed EP, and Dependant Pass (DP)/Long-Term Visit Pass (LTVP) applications. For expert assistance, feel free to contact us via WeChat (WeChat ID: sissi-skyline) or WhatsApp us at +65-91328885.

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