In December 2018, Singapore’s Ministry of Manpower or MOM reported that there were 253,800 foreign domestic workers or maids working in Singapore. There are numerous reasons why a family may want some extra help around the house. In fact, hiring domestic help is quite common.
However, before hiring a new domestic helper, you need to weigh all of the costs. It is important to think beyond merely the foreign domestic worker's or FDW's salary. There are a few upfront as well as recurring costs and fees. Here's what you need to know.
Upfront One-time Costs
1. Agency Fees S$100 to S$2,000
If you choose to use a maid agency, you are likely looking at a price range of S$100 to S2,000. However, the average runs about S$1,100. The agency fee may cover: Recruitment fee Administrative fee Entry test and safety-aware course Airport pickup service
2. Employer's Orientation Programme S$30 to S$46
The Ministry of Manpower requires first-time employers and employers who change FDWs frequently to attend the three-hour Employer's Orientation Programme. This orientation discusses the employer's role and responsibilities.
You must complete the Employer's Orientation Programme at least two working days before submitting a Work Permit application. This course is available for S$30 if hosted by the Nation Employment Pte Ltd, S$34.50 if hosted by Singapore Polytechnic, or S$46 if taken online.
Additionally, you may appoint a representative or spouse to attend the orientation on your behalf if you meet certain conditions, such as you are a new or expectant mother. See MOM’s website for additional information.
3. Work Permit Application and Work Permit Issuance S$30 + S$30
Your agency fee may already cover your maid's work permit application. However, if not, be ready to pay S$30 for the work permit application and S$30 for the work permit issuance.
4. Settling-In Programme S$75
If this is your foreign domestic worker's first time working in Singapore, you may need to pay S$75 for the Settling-In Programme or SIP. The maid must attend the programme within three days of arrival and can only start working after the program.
This program teaches proper safety at home, in other areas, employment conditions, as well as relationship and stress management.
5. Security Bond S$5,000
A security bond of S$5,000 is required if you are employing a non-Malaysian domestic worker. These funds guarantee that the employer will uphold the laws in regards to the FDW's employment.
Your maid's insurance may guarantee the security bond.
6. Performance Bond S$7,000
A performance bond of S$7,000 for Filipino FDWs or S$6,000 for Indonesian FDWs is required to be paid to the respective consulates. These bonds serve as a guarantee that the employee will meet the embassy's standards of employment.
Your maid's insurance may guarantee the performance bond.
7. Initial Medical Examination S$80
The initial medical exam required to apply for a work permit costs S$80.
8. Monthly Salary S$450 to S$570
The monthly salary of your FDW depends on your maid's nationality or country of origin. An Indonesian maid's monthly salary begins at S$550 while a Filipino maid's salary starts at S$570. On the other hand, a maid from Myanmar begins at S$450.
Salaries typically increase according to the number of years of experience.
9. Foreign Domestic Worker Levy S$300
While you do not need to pay Central Provident Fund (CPF) contributions for your maid, you will need to pay the foreign worker levy. According to the MOM, this levy "is a pricing mechanism to regulate the number of foreign workers in Singapore."
The monthly rate is S$300 for the first FDW. Subsequent FDWs cost S$450. For qualified FDW employers, the levy concession is S$60 per month. For levy concession, you must be eligible under the young child or grandchild scheme, aged person scheme, or persons with disabilities scheme.
10. Maid Insurance S$250
The Ministry of Manpower requires employers of foreign workers to have maid insurance. The minimum personal accident coverage is S$60,000 and a minimum of S$15,000 for medical coverage.
The basic maid insurance premium to fulfill the requirements is approximately S$250 for 26 months. This number can vary depending on extra coverage or riders you may choose to add.
Be sure to note that FDWs are required to go for a medical check-up every six months. Your maid must be tested every six months for pregnancy and syphilis. Every two years, she must be tested for HIV. Finally, upon two years of residence in Singapore, she will need to be tested for tuberculosis once.
The costs of these medical visits will vary according to the medical clinic she attends and her medical insurance. However, overall, these bills are the responsibility of the employer.
The employer is obligated to pay for the domestic helper's airfare home upon cancellation of her work permit.
12. Food, Accommodation, and Toiletries S$330
As an employer, you are also accountable for your maid's food and accommodations. If you do not cook, you will need to give your maid some cash to purchase her own meals. This expense may come out to about S$300 per month.
Of course, you are also required to provide sufficient accommodations, as stipulated by the guidelines outlined in your security and performance bonds.
While it is not required unless previously discussed in your maid contract, you may consider providing basic toiletries for your maid. You may choose to pay for shampoo, toothpaste, and a toothbrush. This expense may come out to about S$30 per month.
What should your monthly income be to afford a full-time foreign domestic worker? The annual cost of a maid is approximately S$12,500 with the concessional rate for the FDW levy. With the average household expenditure being S$4,839 and allowing 20% for savings, the total minimum income to afford a full-time FDW is S$6,780 after CPF contributions.
The median gross income in Singapore after CPF contributions is about S$3,500. As a result, a household with only one member earning the median salary would not be able to afford an FDW.
A full-time FDW is better suited for families with two working adults whose household fulfills the requirement for levy concessions.
The total upfront amount to hire a maid ranges between S$345 and S$2,261. These numbers exclude any applicable security deposits and performance bonds.
The monthly expense to have a full-time live-in maid ranges between S$1,101 and S$1,221, in the case that you do not qualify for levy concessions and your helper makes the minimum salary. This monthly expense also does not take into account travel or medical expenses.
Overall, hiring a foreign domestic helper requires more planning than merely calculating an FDW's monthly salary into your family's budget. However, there are many fantastic reasons to consider a little extra help around the house. An FDW could help alleviate the pressures of cleaning, cooking, and can eliminate the need to hire other childcare services altogether, while you are at work.
On the other hand, there are extra responsibilities and guidelines that employers must follow. This also includes having an additional person living in the house. You will need to maintain proper communication, set clear expectations, and address possible cultural differences. By weighing the real financial costs and other considerations, you will know whether a foreign domestic worker is a good fit for your family.