APAC Compliance Guide for FinTech HR Teams

1. Employment contracts and HR policies

Drafting compliant contracts:

• In Singapore, the Employment Act outlines minimum employment terms, while in Malaysia, the Employment Act 1955 provides similar protections. In Indonesia, Law No. 13/2003 on Manpower regulates employment contracts.
• Specific clauses regarding intellectual property rights must align with each nation’s laws. For example, in Japan, the Patent Act and Copyright Act provide distinct frameworks.
• Every country in APAC has nuanced contract regulations, and it’s important your organization’s HR team pays close attention to the differences across countries.

Standardization vs. Customization: 

• While a global template provides consistency, consider that in Vietnam, labor contracts must be in Vietnamese. In Thailand, specific clauses regarding termination and severance pay must align with the Thai Labor Protection Act.
• HR must work closely with legal counsel to ensure contracts align with the specific regulations of countries like South Korea, where labor laws are heavily influenced by court precedents.

2. Data privacy 

Data privacy is a key and growing concern for countries across APAC. Navigating the various regulations is critical for your HR team. Here are some examples of different data privacy protections across APAC to consider:

Cross-border data transfer:

• Singapore's Personal Data Protection Act (PDPA) and Australia's Privacy Act 1988 have distinct requirements for data transfers (something particularly relevant to FinTech companies Singapore), differing from China's Personal Information Protection Law (PIPL).
• Be aware of Indonesia's Personal Data Protection Law (UU PDP) that closely resembles GDPR.

Employee data management:

• Implement data encryption and access controls that comply with the PDPA in Singapore or the PIPL in China.

Read next: How HRIS Supports Employee Data Management

Data retention policies must consider the specific requirements of each jurisdiction, as in India, where the Digital Personal Data Protection Act 2023, is now in effect.

Best practices:

• Obtain explicit employee consent for data processing, as required by the PDPA in Singapore and the PIPL in China.
• Conduct regular data security audits in line with the standards set by the Cyber Security Agency of Singapore (CSA) or similar bodies.

3. Labor laws

Dispute resolution:

• In Japan, labor disputes are often resolved through labor tribunals or courts. In Australia, the Fair Work Commission handles workplace disputes.
• In the Philippines, the National Labor Relations Commission (NLRC) handles labor disputes.

Mediation and arbitration

• Mediation is commonly used in Malaysia and Thailand, while arbitration is favored in Hong Kong. Make sure your organization knows the preferred approach in the APAC country your organization operates in.

Conflict prevention:

• Implement clear grievance procedures and promote open communication, taking into account cultural nuances, especially in countries like Indonesia and Vietnam, which typically expect nuanced approaches to resolving conflicts.

4. Anti-money laundering (AML) and know your customer (KYC)

• Some APAC countries demand more strict adherence to AML and KYC laws. Ensure FinTech HR compliance with AML/KYC regulations set by financial regulators in countries like Hong Kong (HKMA), Singapore (MAS), and Japan (JFSA).
• Implement robust employee background checks and screening systems, as required by AML regulations in countries like Australia (AUSTRAC).

5. Financial services regulations

Licensing and registration

• Obtain necessary licenses from regulators like the MAS in Singapore or the JFSA in Japan.
• Be aware of the varying licensing requirements in emerging markets like Vietnam and Indonesia.

Financial reporting:

• Ensure compliance with International Financial Reporting Standards (IFRS) and local accounting standards, as required by regulators in countries like South Korea and Taiwan.

Risk management:

• Implement policies related to employee conduct, data security, and FinTech HR compliance training, adhering to guidelines issued by regulators in countries like Australia and New Zealand.

6. Cross-border compliance

International tax regulations:

• Understand double taxation agreements and the tax implications of employee stock options, considering the tax laws of the various countries you work with across APAC.

Work visa requirements:

• Be aware of and learn to navigate particularly complex visa requirements such as in countries like Japan, South Korea, and Australia, ensuring compliance with immigration laws.

Relevant reading: Singapore Work Permits and Visas: A Global Employer Guide

Data transfer regulations:

• Adhere to data transfer regulations when moving employee information across borders, considering the PDPA in Singapore and the PIPL in China.

7. Employee rights and benefits

Compensation structures

• Understand minimum wage requirements, overtime pay regulations, and mandatory leave entitlements across various APAC countries; some (like the Philippines) have different minimum wages depending on the area of the country and industry worked in.

Benefits compliance

• Ensure compliance with mandatory social security contributions such as Malaysia’s EPF, Thailand’s Provident Fund, the Philippines’ SSS, healthcare regulations, and pension schemes.

Learn more: Understanding Hong Kong's Rental Reimbursement Scheme

Anti-discrimination and diversity:

• Implement policies that comply with anti-discrimination laws and promote workplace diversity, considering the Equal Opportunity Act in Australia and similar legislation in other countries.

8. Taxation, remuneration and compensation compliance

Tax implications

• Understand the tax implications of employee compensation, including income tax, social security contributions, and fringe benefits tax in countries like Thailand and Taiwan.

Payroll compliance

• Ensure accurate payroll processing and reporting, adhering to the specific tax regulations of each country, such as the Inland Revenue Authority of Singapore (IRAS) guidelines.

FinTech-specific compensation:

• Be knowledgeable about the tax implications of stock options and other FinTech-specific compensation models, considering the tax laws of countries like India, Japan, and South Korea, countries known for their thriving FinTech industries.

Read next: 6 FinTech Challenges & How Omni’s Global HRIS Solves Them

Establish a clear compliance framework

Work to develop a comprehensive compliance framework that outlines all relevant regulations, policies, and procedures. Clearly define roles and responsibilities for compliance within the HR department and across the organization. Make sure you document all compliance-related processes and procedures—this is particularly important if you expect routine audits.

Implement robust monitoring system

Use an HR Information System (HRIS) with built-in compliance features to automate tracking and reporting of key HR data. Implement automated audit tools to regularly monitor HR processes and identify potential compliance gaps.

Also, make sure to leverage data loss prevention (DLP) tools to protect sensitive employee data and prevent unauthorized access or disclosure. Use robust background check and screening systems to stay compliant with AML and KYC requirements.

Omni makes data protection and privacy simple with robust access controls, AES-256 encryption standard, and end-to-end encryption to ensure maximum protection for your data.

Our compliance-ready features make keeping your data secure from an employee level seamless. Regular compliance reporting and consent management capabilities ensure your data is secure at every level.

Conduct regular audits and assessments

Schedule regular internal audits to assess the effectiveness of compliance programs and identify areas for improvement. In addition, conduct external audits by independent auditors to ensure objectivity and credibility, and catch anything you might have missed. Your team should also perform regular risk assessments to identify potential compliance risks and develop mitigation strategies.

Maintain accurate and detailed reports

It’s important that your team maintain accurate and detailed records of all HR-related activities, including employment contracts, payroll data, and compliance documentation. Make sure that all reports are readily accessible and auditable. To make this process more seamless, implement a system for tracking and managing compliance-related incidents and corrective actions.

‍As your organization’s single source of truth, Omni provides a secure, digital record to centralize all documentation—from employment contracts to employee handbooks. With cloud-based storage backed by end-to-end encryption, Omni’s document management makes retrieval simple and instant. Role-based access controls help ensure only authorized employees have access to sensitive information, and approval workflows allow your team to route contracts and offer letters for e-signature and review with 360-degree visibility.

“Omni excels at being very user-friendly; it’s one of the more intuitive systems that’s really focused on the user. The platform gives you a simplified, clean look that is easy for HR to navigate and for our employees to use. We saw the effects almost immediately.” 
- Arvin S., HR Manager at Newbit

Access the story: Newbit cuts data analysis by 4 hours with Omni’s document management

Develop effective reporting mechanisms

Establish clear reporting channels for employees to report FinTech HR compliance concerns or violations.

To do this, develop regular reporting mechanisms to provide management with updates on compliance status and key metrics. Use dashboards and other visual tools to present compliance data in a clear and concise manner.

Provide ongoing training and education

It’s a good idea to conduct regular training sessions for HR staff and employees on relevant compliance topics. You should provide access to online resources and training materials to support ongoing learning. Make sure that your training programs are tailored to the specific needs of the organization and the regulatory environment.

Stay informed and adapt

Keep your eyes on changes to regulations and industry best practices. Your team should regularly review and update compliance policies and procedures to reflect changes in the regulatory environment.

Encourage a culture of FinTech HR compliance within the organization and encourage employees to report compliance concerns. You can also participate in industry forums, webinars, and conferences to stay up to date on compliance trends.

Training HR staff on compliance matters

Regular training sessions: Conduct frequent and comprehensive training sessions covering relevant compliance topics, including data privacy, labor laws, AML/KYC, and financial services regulations.

Specialized training: Provide specialized training for HR staff responsible for specific compliance areas, such as payroll, benefits, or data management.

Scenario-based training: Use scenario-based training to help HR staff apply compliance knowledge to real-world situations.

‍Continuous learning: Encourage continuous learning and professional development by providing access to online resources, webinars, and industry conferences.

Encouraging a culture of compliance

Leadership commitment: Ensure that senior management demonstrates a strong commitment to compliance and sets a positive example.

‍Clear communication: Communicate compliance policies and procedures clearly and consistently to all employees.

‍Open reporting channels: Establish open and accessible reporting channels for employees to report compliance concerns without fear of retaliation.

‍Incentivize compliance: Recognize and reward employees who demonstrate a commitment to FinTech HR compliance.

‍Learn more: 12 Employee Recognition Examples For Year-Round Engagement

Consistent enforcement: Enforce compliance policies consistently and fairly across the organization.

Partnering with legal and compliance teams to reduce risk

Regular collaboration: Foster a close working relationship between HR and legal/compliance teams to ensure alignment on compliance matters.

Joint risk assessments: Conduct joint risk assessments to identify potential compliance risks and develop mitigation strategies.

Policy reviews: Collaborate on the review and update of HR policies and procedures to ensure they are legally sound and compliant.

Additional resources: HR Practices and Policies for Scaling Startups

Legal counsel: Seek legal counsel on complex compliance matters and ensure that HR staff are aware of relevant legal developments.

Optimize HR processes

Automation: Leverage HR technology to automate compliance-related tasks, such as background checks, data management, and reporting.

Standardization: Standardize HR processes across the organization to ensure consistency and efficiency.

Documentation: Maintain accurate and detailed documentation of all HR-related activities to support audits and demonstrate FinTech HR compliance.

‍Regular reviews: Regularly review and optimize HR processes to identify areas for improvement and ensure ongoing compliance.

‍HRIS utilization: Maximize your HRIS capabilities to track, monitor and report on all compliance-related data.