# Own entity, Employer of Record or Manpower Outsourcing who is the employer in Singapore

URL: https://skillsforce.com.sg/insights/eor-vs-manpower-outsourcing-vs-own-entity-singapore
Title: Employer of Record vs Manpower Outsourcing vs your own entity in Singapore | Skillsforce
Description: An Employer of Record, Manpower Outsourcing and your own entity are not interchangeable. Here is who is legally the employer under each, and what follows.
Updated 18 August 2026. First published 18 August 2026. Author: Skillsforce (People-operations team)
Category: comparisons

Three routes get compared as though they were interchangeable: incorporate and hire directly, engage a third party that becomes the employer on paper, or use Manpower Outsourcing. They sit on opposite sides of one question Singapore's Ministry of Manpower actually answers: who is the employer, and what follows from that. Here is the comparison on that axis, not on marketing.

## What is the real difference between an Employer of Record, Manpower Outsourcing and hiring through your own entity in Singapore?

The difference is who is legally the employer. Your own entity makes you the employer directly. A third party marketed as an Employer of Record claims that role for a company with no Singapore presence, which MOM states would be an offence for anyone needing a work pass. Manpower Outsourcing only works once your entity already exists.

## Key points

- Three routes get compared as though they were interchangeable: your own entity, a third party marketed as an Employer of Record, and Manpower Outsourcing. The difference that matters is who is legally the employer, not the label on the contract.
- MOM applies its own test to that question: control over recruitment, dismissal and wages, ownership of the tools and workplace, and who carries the economic risk. Calling someone an independent contractor does not settle it on its own.
- MOM states plainly that work passes are for foreigners to work for Singapore-based companies, and that an Employer of Record sponsoring one for staff of an overseas employer would be committing an offence.
- Manpower Outsourcing only works once a client already holds a Singapore entity. It is not a route around having one.
- Manpower Outsourcing does not put work passes in Skillsforce's hands. Only the direct employer can sponsor a work pass, which is exactly why Skillsforce does not claim to.
- Skillsforce is not an Employer of Record. Where a client has an entity, Skillsforce signs contracts, pays CPF and issues payslips as Manpower Outsourcing; where a client has none yet, the support is recruiting and shortlisting, never employment.

Three ways of getting someone working in Singapore get talked about as though they were flavours of the same thing: incorporate and hire directly, engage a third party that becomes the employer on paper, or use Manpower Outsourcing. They are not flavours of the same thing. They sit on opposite sides of one question that Singapore's Ministry of Manpower (MOM) actually answers in writing: who is the employer, and what follows from that.

Skillsforce is not an Employer of Record and does not offer EOR services. This article explains how such arrangements are treated in Singapore. Where we describe our own service, it is Manpower Outsourcing: for clients with a Singapore entity, Skillsforce signs the employment contracts, pays CPF and issues payslips, while the client directs the day-to-day work.

That employer question decides everything downstream of it: who can sponsor a work pass, who carries CPF and Employment Act obligations, and who is exposed if MOM ever looks closely at the arrangement. What follows sets out the test MOM actually applies, then compares the three routes against it, plainly, including where each one stops.

## The test MOM actually applies

MOM does not decide who the employer is by reading the title of a contract. It states there is no single test, and instead weighs a set of factors grouped under three headings:

- **Control.** Who decides on recruitment and dismissal, who pays the wages, and who determines how the work gets done.
- **Ownership of the factors of production.** Who provides the tools, equipment, workplace and materials the work needs.
- **Economic considerations.** Whether the work is conducted on the worker's own account or the employer's, and who carries the risk of loss.

A contract's own label, "independent contractor" being the common one, is not decisive on its own, and whether the engagement is full-time or part-time is not itself relevant either. A contract of service may be covered by the Employment Act; a contract for service is not. That test is the spine of the comparison below. Three routes, one question asked of each: who actually sits behind these factors, whatever the paperwork calls the arrangement.

## Route one: your own entity

Incorporate through ACRA and the answer to "who is the employer" is not really in question. You are, in the plain sense MOM's test describes. Your entity decides who is hired and who is let go, pays the wages, and owns or leases the tools, workplace and materials the work needs. You hold the work passes your foreign hires require, because only a genuine Singapore-based employer can sponsor one. The Employment Act and CPF Act obligations sit with you directly, and nobody stands between your company and MOM, IRAS or the CPF Board if something needs explaining.

That directness is also the cost of this route. Every obligation that comes with being an employer, CPF contributions, itemised payslips, leave entitlements, notice periods, work pass renewals, sits with your own team until you decide otherwise. Owning the relationship outright removes any ambiguity about who the employer is; it does not remove the administrative load of actually being one.

## Route two: a third party that employs the staff

The pitch behind what gets marketed as an Employer of Record is straightforward. A company wants a person working in Singapore without registering an entity here, so a third party stands in as the employer on paper, runs the person's payroll and statutory contributions, and lets the client direct the work day to day. For a fully remote hire who never needs government permission to work here, this raises fewer immediate questions, because nobody is applying to MOM for anything.

It stops working the moment the person needs to be physically based in Singapore and needs a work pass to do it, and MOM has published a specific, dated answer to exactly that scenario. Asked whether an Employer of Record in Singapore can apply for work passes for foreigners to be based in Singapore while working for overseas companies, MOM's answer is: "No. Work passes are for foreigners to work for Singapore-based companies." It goes further: an Employer of Record that applies for a work pass in that scenario "would be committing an offence."

That is MOM's own wording, published as a dated FAQ answer on mom.gov.sg, last updated 9 July 2024, not a press release, not a new law, and not a vendor's summary of one. Read it narrowly, because the FAQ itself is narrow: it addresses one specific scenario, a foreigner who needs a work pass, working for a company based overseas, with a third party standing in as the applicant. Under MOM's own test above, the label "Employer of Record" does not change who actually controls recruitment, pays the wages, and carries the economic risk of that relationship. For this particular scenario, MOM has stated in its own words which side of that line the arrangement falls on.

It is worth separating two things that sound similar but are not. Work pass applications, for an Employment Pass, an S Pass or a Work Permit, can each be made by the employer directly, or by an appointed employment agent acting on the employer's behalf. Being the party that files the application is not the same as being the employer MOM's test looks at. An employment agency needs its own licence to place job seekers and can act as an agent for a genuine employer, but filing the paperwork does not transfer the employment relationship to whoever submits it. That is precisely the gap a third party standing in as an Employer of Record cannot close: it can fill in a form, but it cannot manufacture the control, the wage payment and the economic relationship the form is supposed to describe.

## Route three: Manpower Outsourcing, once you already have an entity

Manpower Outsourcing sits on the other side of the same test, because it starts from a different place entirely: it only applies where the client already holds a Singapore entity. Where that is true, Skillsforce signs the employment contracts, pays CPF and issues the payslips, while the client directs the day-to-day work. Set that against the factors MOM's test actually names and the split is visible rather than hidden: recruitment, dismissal and wage payment sit with Skillsforce, the party that signs the contract, while direction of the work day to day sits with the client. Day-to-day direction is one of the factors MOM weighs, not the whole test, which is why the arrangement has to be documented and run as a genuine employment relationship rather than assumed to be one. CPF follows the same requirement from the other direction: contributions are payable only where a genuine contract of service exists, and under this arrangement that contract is the one Skillsforce holds with the staff it employs.

What Manpower Outsourcing does not do matters just as much as what it does. It is not a route around having an entity: the client's own Singapore entity is the reason the arrangement is possible at all, not something it replaces. And it does not put work passes in Skillsforce's hands. Only the direct employer can sponsor a work pass, which is exactly why Skillsforce does not claim to.

For a start-up with no Singapore entity yet, the honest offer is narrower again: support before incorporation, meaning recruiting, screening and shortlisting candidates, never employment. Recruiting someone does not, on its own, make anyone the employer; under MOM's test that relationship only exists once a genuine contract of service is signed, and there is no entity here yet for anyone to sign one with. That is the reason the pre-incorporation offer stops at recruitment, rather than a technicality anyone works around. [Manpower Outsourcing before incorporation](/services/contract-management/before-incorporation) sets out exactly where that boundary sits.

## The three, side by side

| Aspect | Your own entity | A third party as employer (the EOR pitch) | Manpower Outsourcing |
|---|---|---|---|
| Requires you to already hold a Singapore entity | Yes, this is what creates one | No, that is the entire pitch | Yes, always |
| Who signs the employment contract | You do, directly | The third party does | Skillsforce does, for a client that already holds an entity |
| Can sponsor a work pass for the role | Yes, as the direct employer | No. MOM: this "would be committing an offence" | No. Only a direct employer sponsors a pass; this sits outside the service |
| Who pays CPF and issues payslips | Your entity does | Not addressed by MOM's Singapore FAQ; varies by provider | Skillsforce does |
| Who directs day-to-day work | You do | The client does, in the arrangement's own pitch | The client does |

## Choosing between the three

Only one of these three is actually a live choice at the point most companies are asking the question. If there is no Singapore entity yet and someone needs a work pass to work here, MOM's own test and its own FAQ both point the same way: register the entity, through ACRA or, more narrowly and temporarily, a representative office, before anything else. [Representative office vs entity vs Manpower Outsourcing](/insights/representative-office-vs-entity-vs-manpower-outsourcing-singapore) sets out the fuller comparison between those two structures, and [Employing staff in Singapore without a local entity](/insights/employ-staff-singapore-without-local-entity) covers MOM's position on the third-party route in more depth than the summary above.

Once the entity exists, the real choice is between running payroll, CPF and contracts in-house or handing that administration to a partner while your own team keeps directing the work. That is the question Manpower Outsourcing answers, and where a client's own entity is already in place, it is the one part of this comparison Skillsforce runs directly. [Manpower Outsourcing](/services/contract-management) covers how that arrangement is scoped.

## Frequently asked questions

### What decides who is the employer under Singapore law, if not the contract's title?

MOM's own test, not the label. It weighs control, meaning who decides on recruitment, dismissal and wages; ownership of the factors of production, meaning who provides the tools, equipment and workplace; and economic considerations, meaning who carries the risk of loss. A contract's own label, "independent contractor" or otherwise, is not decisive on its own.

### Can a third party marketed as an Employer of Record sponsor a work pass for my Singapore hire?

Not if the person actually works for an overseas company. MOM states plainly: "No. Work passes are for foreigners to work for Singapore-based companies," and that an Employer of Record applying for one in that scenario "would be committing an offence." The FAQ has stood, last updated, since 9 July 2024.

### Does Manpower Outsourcing let me skip registering a Singapore entity?

No. Manpower Outsourcing only works once a client already holds a Singapore entity; it is how that entity avoids running payroll and CPF in-house, not a way to avoid incorporating. Before incorporation, the available support is recruiting and shortlisting, never employment.

### Does Skillsforce sponsor work passes for staff placed under Manpower Outsourcing?

No. Only the direct employer can sponsor a work pass, which is exactly why Skillsforce does not claim to. Manpower Outsourcing signs contracts, pays CPF and issues payslips for a client's existing entity; it does not put a foreign hire's work pass in Skillsforce's hands.

### Who carries the Employment Act and CPF obligations if I hire through my own entity?

You do, directly. Your entity decides recruitment and dismissal, pays the wages, and owns or leases the workplace and tools, the exact factors MOM's employer test looks at. Nobody sits between you and MOM, IRAS or the CPF Board.

### Is this the same comparison as representative office versus entity versus Manpower Outsourcing?

No, that is a different axis. That comparison looks at which structure lets a foreign company establish a presence at all. The comparison here answers a narrower question that applies once you are past that: given three ways to get someone working here, who is actually the employer, and what follows from that.

## Sources

- [Ministry of Manpower: FAQ, work passes and Singapore-based companies](https://www.mom.gov.sg/faq/work-pass-general/can-eor-in-sgp-apply-for-work-pass-for-foreigner-to-be-based-in-sgp-while-working-for-overseas-coys) (Page states last updated 9 July 2024; accessed 18 August 2026)
- [Ministry of Manpower: What is a contract of service](https://www.mom.gov.sg/employment-practices/contract-of-service/what-is-a-contract-of-service) (Page states last updated 29 December 2025; accessed 18 August 2026)
- [Ministry of Manpower: Employment Pass, apply for a pass](https://www.mom.gov.sg/passes-and-permits/employment-pass/apply-for-a-pass) (Page states last updated 15 June 2026; accessed 18 August 2026)
- [CPF Board: Who should receive CPF contributions](https://www.cpf.gov.sg/employer/employer-obligations/who-should-receive-cpf-contributions) (Page states last updated 22 June 2026; accessed 18 August 2026)

## Related

- [Employing staff in Singapore without a local entity](https://skillsforce.com.sg/insights/employ-staff-singapore-without-local-entity)
- [Manpower Outsourcing](https://skillsforce.com.sg/services/contract-management)
- [Manpower Outsourcing before incorporation](https://skillsforce.com.sg/services/contract-management/before-incorporation)
- [Representative office vs entity vs Manpower Outsourcing](https://skillsforce.com.sg/insights/representative-office-vs-entity-vs-manpower-outsourcing-singapore)