14 Hidden Costs You Should Know When Hiring a Domestic Helper

With more dual-income families on the rise, hiring a domestic helper sometimes is necessary to help out with some of the duties at home, which may include caring for the elderly or helping with home maintenance. A domestic helper can be recruited through the help of a maid agency, or independently hired without an agency. 

Before hiring a domestic helper, it is important to know the costs involved in the process. Hiring a helper is a weighty commitment. Most domestic helpers are on a two-year contract, and domestic helpers often live with the family, which is another change for the family to adapt to.

Some commonly known costs for hiring a domestic helper would be the work permit application and issuance, the pre-employment medical examination for the helper, and transport to Singapore.  These are the costs which are one-time off and do not need to be paid again.

However, there are other recurring costs involved in hiring a helper, and also other one-time costs as well besides those mentioned above. What are the other costs involved in hiring a domestic helper? 

Recurring Costs

Salary

When you hire a domestic helper, salary is an expense you have to pay to your helper on a monthly basis. A  factor affecting a domestic helper’s salary would be the country which they come from. The majority of the domestic helpers in Singapore come from countries such as India, Indonesia, Malaysia, Myanmar, Sri Lanka, The Philippines, Thailand, and Taiwan. Helpers from different countries have different minimum wages. For example:

• Myanmar – $450
• Cambodia – $500
• Sri Lanka – $500
• Indonesia – $550
• The Philippines – $570

Domestic helpers from the Philippines have higher minimum monthly salaries due to their competency in English, which makes it easier for them to communicate with their employers and others in the family.  The average salary Singaporean employers are paying their maids is around $597, which is above the average rate compared to other employers around the world. 

Another factor affecting a domestic helper’s salary will be their length of working experience. The more experienced they are, the higher their expected salary. MSIG gives a general guideline on monthly salary ranges for the number of years of experience: 

• For domestic helpers with one year of experience: $500 to $620 monthly salary
• For domestic helpers with two to five years of experience: $650
• For domestic helpers with more than six years of experience: $700 to $850

Foreign Worker Levy

To regulate the number of foreign workers in Singapore, the Ministry of Manpower has implemented a foreign worker levy, which is an additional sum of money paid per worker employed. With domestic workers, this levy is applicable as well and must be paid on a monthly basis while the domestic helper is still in employment with the employer. 

According to the Ministry of Manpower, the current levy rate for a household’s first foreign domestic helper stands at $300 per month. Subsequently, if there are any additional domestic helpers hired by the family, the levy rate will increase to $450 a month. However, if the household qualifies for levy concession, the amount to pay monthly for the levy will be capped at $60. 

To qualify for levy concession, the household will need to fulfil any of these conditions:

Have a Young Child in the Family

Your child must be living in the same household, be below the age of 16 years old, and hold Singapore citizenship, to be eligible for this levy. 

Have Elderly Persons in the Family

If there is an elderly person above the age of 67 years old who is a Singaporean citizen, the concession is applicable. 

Have a Person with Disabilities (PWD) in a Family

The PWD must be medically certified by a Singapore-registered doctor to require help with at least one activity of daily living (ADL), such as showering, feeding, dressing or toileting.

The levy concession for one helper is granted based on one eligible person in the household. It is capped at two helpers per household. The levy concession will automatically start if the individual applying for a domestic helper is more than 67 years old, or has a young child below 16 years old. You will need to apply for the concession if the concession applies to members in the family who meet the criteria for the concession. To apply for the levy concession, you can go over to the Ministry of Manpower’s website and apply. 

If you forget to pay the levy on time each month, there is a late payment penalty of 2% per a month, or $20, depending on which is higher. Your total late payment penalty will be capped at 30% of the outstanding levy. Furthermore, the domestic helper’s work permit will be revoked and you will not be allowed to apply for, renew, or issue a new work permit. Legal action may be taken to recover the unpaid levy as well. 

Daily Living Expenses

Having a domestic helper would mean having an additional adult around the house to feed. It is important to factor in for the additional utility, groceries, and public transportation costs incurred by the domestic helper as she gets about her day-to-day work and lives with your family. Estimated extra costs to expenses could add up to at least $200, according to Dollars and Sense. 

Other additional living expenses which may incur would be expenses from eating out together with the family, and also for family outings. Some employers also pay for their helpers’ telecommunication bills and leisure activities that their helpers take part in as well. 

One-Time Costs

Maid Agency Costs 

Choosing to hire a domestic helper through a maid agency will incur greater costs than hiring a helper yourself. According to Helper’s Choice, you could save almost $2,500 in combined agency fees and recruitment loans to the domestic helper if you choose to hire a domestic helper independently. However, the convenience, expertise, and guarantee of using a maid agency may prove attractive to some employers versus the option of hiring a domestic helper independently. You will not need to source for your own helper and can leave it to the agency, which has a selection of domestic helpers for the picking. Also, the agency will help to settle the related administration for hiring a maid, such as the work permit fee, insurance, medical screening, and airfare, which can be time-consuming to manage if you choose to hire a helper independently.

Maid Agency Fees

Maid agency fees can range between $100 to $2,000, depending on which agency you opt for.

Maid Loan/Placement Fee

Most maid agencies have a component called a placement fee, which is sometimes referred to as a maid loan. This is a sum of money paid by the employer to the agency, to cover the domestic helper’s cost of working in Singapore. You can consider it a loan paid to the agency for the maid to work here. Placement fees are not considered as part of your expenses, as you will be receiving the loan back through deductions made from the domestic helper’s salary in the initial months of employment.

Do take note that some maid agencies charge a placement fee higher than two months of the helper’s salary – this is not allowed. 

Work Permit Costs

Work permit costs include application and issuance, which cost $35 each and $70 in total. Do consider that you will have to renew your domestic helper’s work permit if it has expired. 

Insurance

If you employ a domestic helper through an agency, the insurance cost is likely to be covered by the fees paid to the agency. However, if you are self-employing a domestic helper, you will need to provide insurance coverage for her. This could range up to $225 to $330, for 26 months’ coverage (equivalent to a domestic helper’s usual two-year contract). 

Settling-in Programme Fees

A settling-in programme is required for any first-time domestic helper working in Singapore. This costs $75, and is not required for domestic helpers who have been working in Singapore for a while, or transferring over from another employer. The settling-in programme will help your domestic helper to adjust to life in Singapore, and provide an idea of what working in Singapore is like. Topics include an introduction to Singapore, conditions of employment, and home safety.

Employer’s Orientation Programme

If you are a first-time domestic helper employer, you will need to attend the Employers’ Orientation Programme as a requirement from the Ministry of Manpower. This programme will help new employers understand their role and responsibilities as domestic helper employers. It costs $35 to attend this programme. 

Airfare to Singapore 

If you are not hiring a domestic helper under a maid agency, you will have to pay for your domestic helper’s air ticket to Singapore. This is usually around $400. 

Medical Examinations

It is compulsory for all domestic helpers to undergo medical examinations on a half-yearly basis. A reminder will be sent via email or letter to remind you to bring your helper to the nearest clinic to do so. Depending on the clinic, a medical examination costs around $30 per visit, so twice-yearly medical examinations would cost a total of $60. If you wish to extend the stay of your domestic helper for more than two years, she will need to undergo a HIV and tuberculosis medical examination. These cost $30 and $40 respectively.

Security Bond/ Deposit

If a domestic helper is hired through a maid agency, a security deposit of about $5,000 has to be paid by the employer to the Ministry of Manpower. This is done to act as a safeguard in case: 

• The employer breaches the contract with the domestic helper, or go against Ministry of Manpower’s regulations
• The domestic helper disappears 
• The domestic helper gets pregnant and the employer does not send the helper back to her home country
  

This security bond can be paid in the form of an Insurance Guarantee, so it is not always necessary to pay in cash upfront. 

Other Costs 

There are other costs which may occur as well, especially in this period of COVID-19 and also if you require additional help on your domestic helper’s off day. 

Additional COVID-19 Related Costs

With COVID-19, there are additional costs incurred in bringing in a domestic helper from her home country. Firstly, entry approval must be given by the Ministry of Manpower. Also, the employer will have to ensure that the helper takes valid COVID-19 swab tests prior to her departure from her home country, and makes arrangements for a Stay-Home-Notice (SHN) period at an approved facility. The employer also has to purchase additional medical insurance for the domestic helper to cover any COVID-19-related medical expenses if required, and has to have coverage of at least $10,000. All these costs add up even if you are not using an agency (e.g. SHN dedicated facilities cost about S$1,300 to $2,000 for 14-day SHN while COVID-19 tests cost about S$125 to S$160 each). 

If you are using an agency, the agencies have increased their service fees to reflect the additional work needed to coordinate these new requirements. Airfare costs may also have risen due to limited flight availability, causing flight tickets to be more expensive. 

Additionally, from 1 January 2021, employers must buy additional medical insurance for the maid before her arrival to cover any COVID-19 related medical expenses. This insurance must have coverage of at least S$10,000 for the workers’ medical expenses if they develop COVID-19 symptoms or test positive within 14 days of arrival in Singapore.

Do check the Ministry of Manpower guidelines and regulations on domestic helpers during this period, as information is updated regularly as the COVID-19 situation unfolds. 

Compensation for Working on Off-Days 

Domestic helpers are normally entitled to a day off each week. If the domestic helper is agreeable, there are situations where the employer may request for the domestic helper to work on her off day. The helper must be compensated with a day’s worth of salary in these cases. 

Should I Hire a Domestic Helper in Singapore?

Bearing all these costs in mind, think carefully before hiring a domestic helper – what is your purpose for hiring one? If it is for caregiving purposes solely, considering other options, such as a part-time caregiver may be a cheaper option without breaking the bank.

Homage provides caregiving services for your loved ones at every stage. Our trained care professionals are able to provide companionship, nursing care, night caregiving, home therapy and more, to keep your loved ones active and engaged. 

Provide the best care to your loved one today! Fill up the form below for a free consultation with our Care Advisory team.