The Legalities of Internships: Are You Paying Enough?

Internships are one of the easiest parts of hiring to get wrong, precisely because they feel informal. A student comes in for twelve weeks, everyone calls it a learning opportunity, and the paperwork that would be automatic for a permanent hire quietly never happens. The legalities of internships in Singapore are narrower than most employers assume, but the parts that do bite, contracts of service, CPF and work passes, bite where the money is.

Who this applies to

This is written for Singapore employers who take on interns, trainees or students on attachment: whether you hire local students from a polytechnic, ITE or university, run an unpaid programme you have never had checked, host foreign interns, or rely on your local workforce count for Work Permit and S Pass quota purposes. It applies with particular force where an intern does work a junior employee would otherwise do, since that is where MOM looks most closely.

Key rules and requirements in Singapore

There is no minimum internship allowance

Singapore has no general minimum wage, and the Employment Act sets no minimum allowance for interns. An unpaid internship is not automatically unlawful. What matters is a different question: is your intern an employee?

The test is whether a contract of service exists

An intern engaged under a contract of service is an employee and is covered by the Employment Act. A student on an attachment forming part of their course of study, arranged through their institution, generally is not. In practice, the more the arrangement resembles ordinary work, with fixed hours, assigned deliverables and performance expectations, the harder it becomes to argue that no contract of service exists. Calling it an internship in the offer letter does not settle the point.

If the intern is an employee, the Employment Act applies in full

Key Employment Terms in writing for anyone employed 14 days or more.
Salary paid within seven days of the end of each salary period.
Itemised payslips.
Leave, rest day and hours of work provisions according to the role and salary level.

CPF: payable by default, exempt by exception

CPF is payable for Singapore Citizen and Permanent Resident employees, interns included, where an employer-employee relationship exists. The exception matters: employers are exempt from CPF on internship wages where the intern is enrolled at an institution or programme subsidised by the Ministry of Education and the training is approved by that institution. The attached condition is the one employers forget. You must obtain and retain the institution’s documentation, including for any extension. Where the school has not endorsed the internship, CPF is payable as for any temporary hire.

Local Qualifying Salary and your foreign worker quota

From 1 July 2026 the Local Qualifying Salary rose to S$1,800 per month for full-time local employees, with the part-time equivalent at S$10.50 per hour. LQS is not a minimum wage. It decides whether a local employee counts towards your foreign worker quota entitlement: a full count at S$1,800 or above, half a count between S$900 and S$1,800. A stipend that qualified in 2025 may not qualify now.

Foreign interns need the right pass

A foreign national cannot intern here without a valid work pass, and a student visa is not one. The usual routes are the Training Employment Pass, for foreign students on a course-related attachment or trainees posted in from an overseas office of the same group, and the Work Holiday Pass for eligible students and graduates aged 18 to 25. The Training Employment Pass carries a fixed monthly salary floor of S$3,000, is capped at three months and cannot be renewed, though students from institutions on MOM’s acceptable list may qualify without meeting that floor.

Safety and injury cover

Workplace safety and health duties extend to everyone at your workplace, interns included, whatever their employment status. Work injury compensation, however, follows employment status, so an intern who is not an employee may sit outside that cover. Check your insurance.

Step-by-step process

Decide what the arrangement actually is. Map the hours, supervision, deliverables and duration, then assess honestly whether this is training or employment.
Confirm the institutional link. Get written confirmation from the school that the attachment is part of the course and approved by them. That letter supports your CPF position.
Check pass status before the start date. Citizens and Permanent Residents need no pass. Everyone else does.
Set the allowance deliberately. Benchmark against the market for the discipline, then test the figure against LQS if the intern sits in your local headcount.
Issue written terms covering duration, allowance, hours, confidentiality, intellectual property and personal data, even where the Employment Act does not apply.
Set up payroll and tax. Internship allowances are taxable and must be reported to IRAS, through the Auto-Inclusion Scheme where you participate in it.
Close out properly. Pay the final allowance on time, complete the school’s assessment and revoke system access.

Common mistakes to avoid

Treating unpaid as risk-free. An unpaid arrangement that functions as a job carries the most risk, because salary claims and CPF arrears both flow from one finding: that a contract of service existed.
Claiming the CPF exemption without the paperwork. No institutional documentation, no exemption. An attachment extended informally, beyond what the school approved, can also fall outside it.
Using an intern to plug a headcount gap. Filling a vacated executive role with an intern on a token allowance is hard to call training.
Overlooking personal data. Interns often handle customer records, and PDPA obligations do not soften because the handler is temporary.

Practical examples

A twelve-week polytechnic attachment. A logistics firm takes a student for a required attachment, pays a S$900 monthly allowance and keeps the school’s approval letter on file. CPF is exempt on the strength of that letter. The firm issues written terms and payslips anyway, and reports the allowance to IRAS. Clean arrangement.

A graduate on a rolling internship. An agency engages a recent graduate, no longer enrolled anywhere, on a S$1,000 monthly internship rolled over three times across nine months, managing client accounts unsupervised. No institutional link means no CPF exemption, and this plainly looks like employment. Exposure: CPF arrears plus Employment Act shortfalls. The fix is a proper employment contract.

A foreign student from an unlisted university. An engineering firm wants a three-month intern from a European university not on MOM’s list. A Training Employment Pass is available, but only at the S$3,000 floor. The firm budgeted S$1,200 and must either raise it or drop the plan. Better to learn that during budgeting than the week before arrival.

How Singapore Employment Agency can help

Most internship problems are cheap to prevent and expensive to unwind. Singapore Employment Agency reviews internship structures before they start, drafts the written terms, checks whether your CPF position is supportable, and handles Training Employment Pass and Work Holiday Pass applications. We also advise on work pass applications, renewals and appeals, Employment Act and CPF compliance, and the questions that surface when an internship turns into a job offer.

Frequently Asked Questions

Is an unpaid internship legal in Singapore?

It can be, where the intern is a student on an attachment forming part of their course and no contract of service exists. It is not lawful to have someone work as an employee for no pay. Since the distinction turns on substance rather than the label, unpaid arrangements deserve a careful look before they begin.

Do I have to pay CPF for my intern?

Yes by default, for Singapore Citizens and Permanent Residents engaged under a contract of service, unless the exemption applies. The exemption covers interns at an MOE-subsidised institution or programme where the training is approved by that institution, and you must keep the institution’s documentation to support it.

How much should I pay an intern?

There is no statutory figure. Set the allowance against market rates for the discipline and level, then check it against the Local Qualifying Salary if the intern counts towards your local workforce. Underpaying usually costs more in recruitment and retention than it saves.

Key takeaways

There is no minimum internship allowance, but there is a clear test for employee status: does a contract of service exist?
If the intern is an employee, Key Employment Terms, timely salary payment, itemised payslips and CPF all apply.
The CPF exemption for student interns depends on institutional approval you can evidence, and does not survive an unapproved extension.
The Local Qualifying Salary rose to S$1,800 per month, or S$10.50 per hour part-time, from 1 July 2026, changing how interns count towards your quota.
Foreign interns need a work pass. The Training Employment Pass sits at a S$3,000 monthly floor, capped at three months, non-renewable.
Internship allowances are taxable and must be reported to IRAS.

Requirements may change, so always check the latest guidance from MOM, IRAS or ACRA, or consult a professional adviser.

If you would like to find out more about how Singapore Employment Agency can assist with your work pass and employment compliance requirements, please get in touch with the team at [email protected].

Yours sincerely,
The editorial team at Singapore Employment Agency

Disclaimer: This does not constitute legal advice. If you require legal advice, please contact a lawyer.