CPF recovers $635m from employers in 2016

This benefits over 380,000 employees.

The Central Provident Fund (CPF) Board announced that it has recovered about $635.1 million in CPF arrears from cases closed in 2016, benefitting over 380,000 employees. The CPF arrears recovered were from underpayment, non-payment and late payment of CPF contributions by employers.

In 2016, $19.7m was recovered from cases of underpayment or non-payment from 1,608 employers, benefitting 16,202 employees. Among these cases, 32 employers voluntarily came forward to self-rectify upon realising they were not compliant with the CPF Act.

The highest amount recovered through self-rectification in 2016 was from an employer in the financial sector who informed the Board in March 2016 that they had wrongly classified their employees’ incentives payments as Ordinary Wages (OW) instead of Additional Wages (AW). This resulted in underpayment of CPF contributions as the company had applied the monthly OW ceiling when computing CPF contributions for their employees instead of the annual AW ceiling.

The remaining $615.4m recovered were late CPF contributions from an average of about 5,440 employers each month in 2016. Most of the late payments were recovered within a month. The Board’s timely detection and follow-up enforcement actions assisted more than 363,000 workers in receiving their due CPF contributions.

There were 22 convictions for non-payment and underpayment of CPF and 350 convictions for late payment last year. All convicted employers were fined and ordered to pay the CPF arrears by the State Court.