Can Employer Built-in Overtime into Basic Salary?

Q1) Can Employer Built-in Overtime Into Basic Salary?

Q2) I was told that my salary has built in the overtime element, so I cannot claim overtime, is this true?

Q3) My Employment Contracts says that my salary is S$1600 and consist of overtime pay, so I am not allowed to claim overtime. Is this true?

Employee can claim for overtime pay as long as your salary is below S$2000 (non workman) and S$4500 (workman). Your employment contract basic salary cannot build in overtime and you can raise complain to Ministry of Manpower to claim from your employer. If the basic salary and working hour is not clearly stated, this employment contract is arguable and may not be valid.

Employment contract must always clearly stated the normal working hour and the basic salary, if the overtime is necessary, you may want to mention the required overtime per day/per week, and the amount to be paid for overtime. The calculation of overtime shall in-line with Employment Act, if the employee is covered under Part IV of Employment Act.

As an employer, it is not advisable to build-in the overtime pay into the basic salary, this will invite a lot of arguement and by doing so, it does not benefit the employer too, as you need to contribute more CPF.

For example, if employer intend to pay S$1600 to pay for the job to work from 8:30am to 7:30pm, Monday to Friday with 1 hour lunch break, and 8:30am to 12:30pm on Saturday.

The employer can reduce the basic salary and to state clearly in the contract that:-
Basic Salary: S$1200
Working hour (44 hours): Monday to Friday 8:30am to 5:30pm, Saturday 8:30am to 12:30pm
Overtime required: Monday to Friday: 5:30pm to 7:30pm

So, overtime will be paid for extra hours work 2 hours per day, total about 40 hours per month.
Calculation, S$1200 x 12 / 2288 x 1.5 time x 40 hours = S$377.62
In total, employer need to pay employee about S$1200 + S$377.62 = S$1577.62