Itemised Payslips and the Progressive Wage Mark: Would Your Payroll Survive an Audit in 2027?

Your payroll would survive an audit only if every person you paid, including part-timers, relief staff and December temps, received an itemised payslip within three working days of payment, with all the required items shown separately, and if their hourly rate clears the Local Qualifying Salary. Full-time salaried staff on a payroll system almost always pass. The failures sit in three predictable places: casual workers paid by bank transfer with no payslip at all, overtime hours bundled into a single "allowance" line, and no retained records for staff who have already left. All three are fixable in an afternoon in October. None are fixable in the week a request arrives.

What does an itemised payslip legally have to show?

Under the Employment Act, every employee covered by the Act must get an itemised payslip, in soft or hard copy, for each salary period. It has to be issued together with payment, or within three working days of it, and within three working days of dismissal or termination if someone leaves mid-period.

The payslip must separately identify the employer and employee, the salary period dates, basic salary, start and end dates if the period differs, allowances, any deductions, overtime hours worked and overtime pay, the overtime payment period, net pay, and the date of payment. The word that does the work is separately. A single line reading "October pay $2,400" is not an itemised payslip, even if the amount is correct and the worker is happy.

Two documents travel with it. Key Employment Terms must be given in writing within 14 days of a new hire starting, which catches temps as well as permanent staff. And employment records must be kept: for current staff, the latest two years; for staff who have left, their last two years, retained for one year after they go. A business that deletes a departed worker's records on their last day has created a gap that cannot be reconstructed later.

Why do part-timers and peak-season temps break most SME payroll?

Because they are usually paid outside the system. The permanent team sits in payroll software that produces compliant payslips automatically. The three people hired for the November and December rush get paid from a spreadsheet, by PayNow, at an hourly rate someone agreed over WhatsApp. No KETs, no payslip, no record of hours.

That is the single most common finding in an SME payroll review, and Q4 is when it multiplies. It also interacts with money. Part-time and hourly staff must be paid at least the Local Qualifying Salary equivalent, which at the time of writing is $1,600 a month for full-time employees and $10.50 an hour for part-timers. If you employ foreign workers, your local headcount only counts toward your quota when those locals are paid at or above the LQS and receive CPF. An under-rate part-timer is therefore not only a payslip problem, it can quietly shrink the entitlement you are relying on for your S Pass or Work Permit count.

What is the Progressive Wage Mark, and does your business need it?

The Progressive Wage Mark is an accreditation showing your business pays progressive wages to lower-wage workers, covering both the sector Progressive Wage Models (cleaning, security, lift and escalator, retail, food services) and the occupational wages for administrators and drivers.

You need it in two situations. First, if you bid for government contracts, accreditation is a condition of tendering. Second, increasingly, when a larger private customer runs a supplier assessment and asks for it alongside their security questionnaire. In both cases the Mark is not the real work. The real work is that your payroll already pays the published wage steps, shows them on compliant payslips, and can be evidenced. Accreditation is the receipt for that, not a substitute.

What changes in 2027, and what should you decide in October?

Progressive Wage steps and the Local Qualifying Salary are announced ahead of time and move on fixed dates, usually 1 March or 1 July depending on sector. That gives you something unusual in compliance: a known cost, in advance, that you can price into your 2027 budget instead of absorbing it mid-year.

So the October decision is a pricing decision, not an HR one. Pull the published wage schedule for your sector, apply it to your actual headcount, and you get the rupiah-and-cents increase to your wage bill for 2027. Compare that to your current rate card and service pricing. If a customer contract runs through the step-up date at a fixed price, that margin has already been lost and the only remaining question is whether you raise the price at renewal or carry it. Confirm the current LQS and Progressive Wage figures on the MOM website before committing numbers to a budget, because they are revised periodically.

How do you run a 30-minute payroll self-audit this month?

Take last month's bank statement, not your payroll report, and list every person you paid for work. The statement is the honest source; the payroll report only shows who is already in the system. Then for each name, confirm four things: a payslip was issued with all required items separately shown, signed KETs exist, the effective hourly rate clears the applicable minimum, and overtime hours appear as hours and as pay. Anyone on the statement who is not in your payroll system is your gap.

Fix the process, not just the month. Peak staff should be onboarded through the same payroll run as everyone else, even for a two-week engagement, so the payslip is generated rather than remembered. If payroll currently lives in a spreadsheet, this is the business case for moving it: the compliance output becomes automatic, and the December hires stop being an exception.

Frequently asked questions

Do I need to issue payslips to someone who worked only two days?
Yes, if they are an employee covered by the Employment Act. Duration does not create an exemption. A two-day temp needs KETs within 14 days of starting and an itemised payslip within three working days of being paid, which in practice means the payslip is often due before the KETs.

Is an email or PDF payslip acceptable, or must it be printed?
Soft copy is acceptable. A PDF or a payslip in an employee self-service portal both satisfy the requirement, provided all the required items are present and the employee can actually access and keep it. What matters is the content and the timing, not the paper.

What happens if MOM finds we did not issue payslips?
Failure to issue itemised payslips or KETs is treated as a civil contravention, with administrative penalties applied per occurrence and higher amounts for repeat breaches. The larger commercial exposure is usually elsewhere: a missing record means you cannot evidence what you paid if a worker later disputes salary, overtime or CPF.

If you want this checked properly, the fastest route is the bank-statement test above. It takes half an hour and it tells you whether you have a documentation gap, a pay-rate gap, or no gap at all, which is the only way to know whether 2027 needs a budget line or just a tidier process.