Jobs Growth Incentive (JGI)

The Jobs Growth Incentive (JGI) is a salary support scheme that provides employers with 25% or 50% salary support for new local employees hired between September 2020 to February 2021. The salary support under the JGI will be for 12 month from the month of hire and the level of support will be as follow:

  • 50% for mature local hires aged 40 and above

  • 50% for local hires who have disabilities (regardless of age)

  • 50% for local hires who are an ex-offenders (regardless of age)

  • 25% for local hires who are below the age of 40

What the above 25% or 50% means is that the Singapore Government will co-fund up to 25% or 50% of the first S$ 5,000 of the monthly gross salary paid to the new local hire.



Guide Contents

This guide is meant for an introduction to suggest why the Singapore government roll out the JGI scheme, who are the target audience, and how JGI works.


JGI Introduction

JGI Computation Illustrations

Frequently Asked Questions (FAQs)



Jobs Growth Incentive Scheme ("JGI")

The JGI is introduced by the Singapore government in midst of the COVID-19 pandemic to encourage companies to keep the existing local employees and to hire more local employees over 6 months from September 2020 to February 2021. In this context, local employee is defined as either a Singapore Citizen or a Singapore Permanent Resident (PR).


We believe the rationale behind this scheme is to (1) prevent massive and/or continual layoff of local workforce arising from the COVID-19 pandemic, and (2) to encourage companies which are doing well to expand faster with more local people at lower costs base.



Eligibility

To be eligible for the JGI, there must be

  • an increase in overall local workforce size AND

  • increase in local workforce size earning ≥$1,400/month

The above 2 conditions are compared to the company's August 2020 local workforce (ie. "baseline headcount")


The company must have been established (ie. registered/ incorporated) on or before 16 August 2020 to be eligible.


To receive the JGI for full 12 months from the month of hire for each new local hire, the company must have qualified for JGI during the eligibility period, (i.e. September 2020 to February 2021) and continually meet the eligibility criteria for the entire payout period, i.e. September 2020 to January 2022.


Some common examples on employers not eligible for JGI will be:

  • Employers established (registered/ incorporated) on or after 17 August 2020

  • Dormant Employers, e.g. no business activities, not in operations, in midst of Struck off, Struck Off, in liquidation, etc..

  • Representative offices of foreign companies

The above listing is not exhaustive. Please visit IRAS website for the complete listing.



How to Apply For JGI?

Employers do NOT need to apply for the JGI. IRAS will notify eligible employers by post of the amount of JGI payout payable to them. They can also log in to myTax Portal to view the electronic copy of their letter. Employers can expect to receive JGI payouts from March 2021 onwards.



Example 1 - Company With New Local Hires And NO Leavers


Example 1 above is a simple illustration to explain the mechanics of how JGI works.


In August 2020, Employer A has 5 local employees, of which 2 employees are earning more than S$ 1,400 monthly gross salary. The Baseline Headcount will be:


In August 2020 (Baseline Headcount)

5 = Number of local employees in August 2020 [ A ]

2 = Number of local employees earning at least S$ 1,400 monthly gross salary in August 2020 [ B ]


In September 2020, Employer A employs 5 new local employees, of which 3 are above 40 years old. All 5 new local employees earn a monthly gross salary of S$ 5,000.


In September 2020

10 = Number of local employees in September 2020 [ C ]

7 = Number of local employees earning at least S$ 1,400 monthly gross salary in September 2020 [ D ]


JGI Eligibility

[C] - [A] = 10 - 5 = 5 (condition 1)

[D] - [B] = 7 - 2 = 5 (condition 2)


As shown in the above, Employer A will be eligible for JGI in September 2020 as there is an increase in overall local workforce size (condition 1) AND an increase in local workforce size earning ≥$1,400/month (condition 2).

Employer A will receive a total of S$ 10,000 from Singapore government in relation to the September 2020 payroll. This payout will be made to Employer A by the Singapore government automatically in 2021.



Example 2 - Company With New Local Hires And Leavers


Example 2 above takes Example 1 into October 2020 and explain the mechanics of how JGI works if there are leavers (ie. staff resigned and left the organisation)


In August 2020, Employer A has 5 local employees, of which 2 employees are earning more than S$ 1,400 monthly gross salary. The Baseline Headcount will be:


In August 2020 (Baseline Headcount)

5 = Number of local employees in August 2020 [ A ]

2 = Number of local employees earning at least S$ 1,400 monthly gross salary in August 2020 [ B ]


In September 2020, Employer A employs 5 new local employees, of which 3 are above 40 years old. All 5 new local employees earn a monthly gross salary of S$ 5,000.


In September 2020

10 = Number of local employees in September 2020 [ C ]

7 = Number of local employees earning at least S$ 1,400 monthly gross salary in September 2020 [ D ]


In October 2020, Employer A have 2 local employees (each earn a monthly gross salary of S$ 5,000) resigned and left the organisation. Employer A also employs 2 new local employees of which both new local employees earn a monthly gross salary of S$ 5,000.


In October 2020

10 = Number of local employees in September 2020 [ E ]

7 = Number of local employees earning at least S$ 1,400 monthly gross salary in September 2020 [ F ]


JGI Eligibility

[E] - [A] = 10 - 5 = 5 (condition 1)

[F] - [B] = 7 - 2 = 5 (condition 2)


As shown in the above, Employer A will be also be eligible for JGI in October 2020 as there is an increase in overall local workforce size (condition 1) AND an increase in local workforce size earning ≥$1,400/month (condition 2), compared against August 2020.


However, due to the size of original local workforce (August 2020) has been reduced 40% from 5 local employees to 3 local employees (2 resigned and left in October 2020), the JGI for October 2020 payroll will be also be reduced by 40%.


Employer A will receive a total of S$ 7,500 for October 2020 payroll. This payout will be made to Employer A by the Singapore government automatically in 2021.

Note A: 60% x 50% x S$5,000 (Sep'20 new local hires aged 40 or older)

Note B: 60% x 25% x S$5,000 (Sep'20 new local hires aged < 40 year old)

Note C: 60% x 25% x S$5,000 (Oct'20 new local hires aged < 40 year old)


If the Existing Local Employee 4 and 5 is re-hired in subsequent months, the JGI amount will be adjusted back accordingly. However, such re-hiring will not attract JGI as he/she is not considered as a new hire.



When will JGI be paid out?

Eligible employers will receive JGI payouts starting from March 2021, covering gross wages of new local hires paid in the months shown in the table below.



How will Singapore Government derive the gross monthly salary paid to employees?

Gross monthly wages will be computed from mandatory CPF contributions that the employer makes for the local employee for each month, on the remuneration for which mandatory CPF contributions are payable under the CPF Act. This will be based on the mandatory CPF contributions made by employers for the relevant months made by the 14th of the following month (i.e. JGI for new local hires in September 2020 will be based on CPF contributions made on or before 14 October 2020). Gross monthly wages include employee mandatory CPF contributions but exclude employer CPF contributions.


Employers should make timely CPF contributions and ensure that the mandatory contributions are accurate.



If a local employee is hired after February 2021, will there be JGI for this new local employee?

No. As the Singapore government want to encourage employers to bring forward hiring, the JGI is only for new local hires from September 2020 to February 2021 (inclusive).



If a new local hire is offered a job in February but he/ she will only start work in March 2021 and receives his/her first salary in March. Will there be JGI for this new local hire?

No. Only new local hires with mandatory CPF contributions from September 2020 to February 2021 (inclusive) will be considered as new local hires.



Are shareholder-directors included in the computation of Baseline? Will they qualify for JGI?

Local shareholder-directors who are salaried employees of the company are included in the computation of baselines. However, only new local shareholder-directors who are salaried employees of the company will be eligible for the JGI.


Existing shareholder-directors who were not salaried employees in the month of August 2020 will not be eligible for the JGI if they start receiving salary from September 2020 onwards.



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