Oral Answer by Mrs Josephine Teo Minister for Manpower on Employment Issues Amidst COVID-19
NOTICE PAPER NO. 2120 OF 2020 FOR THE SITTING ON 4 JUNE 2020
QUESTION NO. 3615 FOR ORAL ANSWER
MP: Mr Seah Kian Peng
To ask the Minister for Manpower whether the Government will consider a temporary reduction of CPF contributions by both employee and employer till after the economy has recovered from the COVID-19 crisis.
NOTICE PAPER NO. 2122 OF 2020 FOR THE SITTING ON 4 JUNE 2020
QUESTION NO. 3630 FOR ORAL ANSWER
MP: Ms Anthea Ong
To ask the Minister for Manpower (a) what measures are undertaken to ensure fair dismissal practices by employers of work permit holders who have been tested positive for COVID-19 and after the circuit breaker period; (b) what is the course of action for work permit holders who (i) have lost their jobs (ii) have salaries unpaid or (iii) wish to return to their countries of origin; (c) how have measures to safeguard employment and payment of salaries been communicated to (i) work permit holders and (ii) their employers; and (d) whether the Ministry will issue an advisory on (i) employment (ii) salaries (iii) fair dismissal practices and (iv) contract termination for all work permit holders and their employers.
NOTICE PAPER NO. 2123 OF 2020 FOR THE SITTING ON 4 JUNE 2020
QUESTION NO. 3632 FOR ORAL ANSWER
MP: Mr Patrick Tay Teck Guan
To ask the Minister for Manpower what is being done to better protect, assist and support workers, especially professionals, managers and executives, who face contract termination, disguised retrenchments and other job severance and managing excess manpower arrangements which affect their livelihood during this COVID-19 period.
NOTICE PAPER NO. 2123 OF 2020 FOR THE SITTING ON 4 JUNE 2020
QUESTION NO. 3634 FOR ORAL ANSWER
MP: Saktiandi Supaat
To ask the Minister for Manpower (a) how common is the practice for employers and recruiters to ask job seekers to declare their last drawn salary or to share previous payslips; (b) whether any study has been made to ascertain how such practices affected employability and salary packages of job applicants; and (c) whether such a practice should be stopped so that applicants can move up the wage scale.
NOTICE PAPER NO. 2128 OF 2020 FOR THE SITTING ON 4 JUNE 2020
QUESTION NO. 3638 FOR ORAL ANSWER
MP: Mr Ang Hin Kee
To ask the Minister for Manpower (a) arising from the COVID-19 situation, what is the employment status of Singaporeans who are currently based overseas; and (b) what are the assistance support available for them if they have lost their jobs and would like to return to Singapore to seek employment.
NOTICE PAPER NO. 2132 OF 2020 FOR THE SITTING ON 4 JUNE 2020
QUESTION NO. 3653 FOR ORAL ANSWER
MP: Mr Liang Eng Hwa
To ask the Minister for Manpower (a) what is the latest labour market situation and the extent of contraction in local and foreign employment in the last three months; (b) what is the number of job losses expected in the next one year when the Jobs Support Scheme expires; and (c) what are the initiatives to support new job creations.
NOTICE PAPER NO. 2132 OF 2020 FOR THE SITTING ON 01 JUNE 2020
QUESTION NO. 3654 FOR ORAL ANSWER
MP: Mr Liang Eng Hwa
To ask the Minister for Manpower (a) whether the introduction and implementation timeline of the new SkillsFuture Mid-Career Support Package will be impacted by the COVID-19 crisis and can be expedited; and (b) whether the at-risk mid-career workers can be given more transitional support during this steep economic slowdown.
NOTICE PAPER NO. 2133 OF 2020 FOR THE SITTING ON 4 JUNE 2020
QUESTION NO. 3657 FOR ORAL ANSWER
MP: Ms Joan Pereira
To ask the Minister for Manpower whether there are any plans to support employees who have been given notice by their employers to terminate their contracts but who have not received retrenchment benefits for terminations due to redundancies rather than poor performance.
Labour Market Situation and Employment Opportunities
1. Mr Liang Eng Hwa asked about our labour market situation in light of the COVID-19 outbreak. For the first quarter of 2020, preliminary estimates showed a slight uptick of our unemployment rate and retrenchments compared to the previous quarter, even though they remained lower than peaks experienced during the SARS outbreak and Global Financial Crisis. Total employment, excluding foreign domestic workers, registered its sharpest quarterly contraction since SARS, due primarily to a significant decline in foreign employment.
Support for Overseas Singaporeans who Return to Singapore to Seek Employment
2. To Mr Ang Hin Kee’s question, there are about 200,000 Singaporeans living, working or studying abroad at any one time. Our employment surveys do not generally cover these overseas Singaporeans. However, given the global impact of the COVID-19 outbreak, we can imagine that some of them may face job losses. As our citizens, they will always be welcome home. We will also do our best to help all Singaporeans, including those who return. Whether they are fresh graduates or mid-career individuals, all the support systems and services will be extended to them.
3. The Jobs Support Scheme (JSS) and other schemes under the Unity, Resilience and Solidarity Budgets are helping to cushion the impact on the labour market. As Singapore’s GDP is expected to contract by between four to seven percent, we should be prepared for further job displacements. Uncertainty about the future will also moderate hiring. We are therefore making a big push to open up more pathways to jobs, including traineeships and skills upgrading programmes. I will speak more on these measures during the debate on the Fortitude Budget.
4. Given this backdrop, it is understandable that Mr Seah Kian Peng asks if the Government would consider a temporary reduction of CPF contributions. If the objective is to reduce the cost burden to employers, the Job Support Scheme (JSS) has done so with fewer drawbacks. For example, those who depend on CPF contributions to meet housing and healthcare needs can continue to do so. Singaporeans’ ability to save for retirement is also not eroded. As an added advantage, JSS is able to target stronger support to sectors that are more affected by the COVID-19 outbreak.
5. Another avenue of support was offered by the National Wages Council (NWC). Guidelines issued in March suggested that employers can consider reducing non-wage costs and making use of Government support measures such as the SkillsFuture Enterprise Credit to train and upskill workers. The Guidelines also advise employers to consider using the Monthly Variable Component (MVC) to adjust wages to save jobs. Such a tripartite approach to managing cost pressures is not easily available in many countries.
6. Nonetheless, we will continue to monitor and assess the situation, and consider whether other measures, including adjusting CPF contribution rates, may be necessary in the future.
7. In these challenging times, there are also heightened sensitivities about fair treatment.
8. For example, when it comes to recruitment, Mr Saktiandi Supaat is concerned if jobseekers have been forced to declare their last drawn salaries during job applications. In fact, there is no rule that jobseekers must comply, and employers cannot insist on it.
9. We should, however, take a practical approach on whether employers are allowed to ask for such information. The last drawn salary is a relevant input to employers seeking to gauge a candidate’s seniority or to make an appropriate job offer. However, if employers use last drawn salary to screen applicants, they risk losing out on good candidates who are prepared to adjust their salary expectations, especially in today’s context. It is similarly unwise for employers to overlook the longer track record of the applicant, and make an offer based solely on the last-drawn salary especially if the last-held position was an interim one. If a jobseeker chooses to provide salary information, employers should use it carefully.
Fair Retrenchments and Dismissals
10. Mr Patrick Tay and Ms Joan Pereira asked about fair treatment of workers when they are retrenched, terminated, or have their wages reduced.
11. In this challenging period, we recognise that both workers and employers have to make sacrifices and to save jobs wherever possible. Besides the NWC’s Guidelines on the fair approach to adjusting wages, the tripartite partners have issued advisories on managing excess manpower. We have been clear that retrenchment should be a last resort.
12. On the question of “disguised retrenchments”, there are clear guidelines. Even during the COVID-19 period, whatever the termination of employment is called, an employee is presumed to have been retrenched if the employer cannot show a plan to fill the vacancy any time soon. If the retrenchment benefit is spelt out in the employment contract or collective agreement, the employer has a clear obligation to pay. He cannot side-step it by calling the retrenchment something else. If a company is found to have disguised their retrenchments, MOM can and will consider withdrawing Government support like JSS and suspending their work pass privileges.
13. However, in today’s context, the bigger challenge is not that the employer pretends it is not a retrenchment, but that he does not have the means to fulfil his obligations. The tripartite partners have therefore agreed that in instances of genuine financial difficulty for the employer, retrenchment benefit may be re-negotiated or moderated. The norms may have to be set aside in these abnormal times. Nevertheless, businesses should still give some support to retrenched employees, to the extent that they can afford.
14. To ensure fair and responsible implementation of tripartite advisories, MOM has required employers to submit notifications of cost-saving measures they intend to undertake. Through these notifications, MOM and TAFEP identify companies for further engagement, for example, if their planned wage cuts appear excessive. Following our intervention, many companies reviewed their cost-saving measures to give more wage support to employees.
15. Our interventions also reveal that quite often, the worker suspects he has not been fairly treated because of poor communication with his employer.
For example, an employee of a private preschool operator was aggrieved to be asked to clear 13.5 days of her annual leave during the 2-month long Circuit Breaker period. We found that she continued to get full pay even though her work hours were significantly reduced. The employer also saw a sharp drop in revenue due to school fee refunds and the JSS payout was insufficient to cover employees’ full wages during the period. The employer’s request was thus not unreasonable. Nevertheless, after MOM’s engagement, the employer arranged for her to work more days and only clear 6 days of annual leave. The company also took our advice to improve their communications by explaining their cost-saving measures clearly to all staff.
16. The cases we reviewed show that in the course of saving the business and preserving jobs, workers and employers need to build trust and maintain open communication. The tripartite partners firmly believe in the principle of shared responsibility, and urge both employers and employees to work together during this difficult time.
Treating Our Foreign Workers Fairly
17. The general principles of fair treatment apply equally to all our workers, whether local or foreign. Likewise, when companies have to reduce wages in order to save jobs, both local and foreign employees should be considered. In the unfortunate event of retrenchment, it would certainly not be right to expect employers to favour their foreign employees compared to local workers. The government cannot also be expected to provide the same degree of fiscal support to employers to retain their foreign employees compared to their local employees, as Ms Anthea Ong seems to advocate. That is not a question of fairness, but reasonableness.
18. With respect to disputes involving dismissals, salary payment or repatriation home, there are established processes for handling them. It should not matter whether the worker contracted COVID-19 or not. Employers don’t dismiss people because they got the flu or dengue, and they should not do so with COVID-19 either.
19. We have made clear to employers that even if business is disrupted, they must use the levy rebates to provide salary support to their migrant workers. It has also been a long-standing policy that employers have a duty to upkeep their workers until they have been repatriated home. These obligations remain unchanged in this downturn. It is not new to employers and MOM has not seen an increase in the number of such disputes. In any case, migrant workers with issues can raise them to MOM and the Tripartite Alliance for Dispute Management through the Migrant Worker Ambassadors and the Forward Assurance and Support Team officers that are currently deployed at the dormitories.
20. We are very mindful that this period can be stressful to our migrant workers, particularly those living in dormitories. As detailed in my Ministerial Statement in the last Sitting of Parliament, we have made extensive efforts to disseminate information to them, in their native languages. Many NGOs have helped with volunteers manning hotlines and providing additional materials. We are very grateful for their partnership.
21. The National Jobs Council had our first meeting yesterday. Chaired by Senior Minister Tharman Shanmugaratnam, the Council includes veteran business leaders from industries and union leaders. It will focus on identifying and developing jobs, traineeships and skills training opportunities for Singaporeans amidst the COVID-19 situation. We will open up many more pathways to jobs. As pointed out by SM Tharman, the scale of our attempt goes beyond any past experience. Complementing these efforts must be a renewed emphasis on fair opportunities for Singaporeans. That is no less important in my view.
22. At the start of the year, MOM had identified Fairness at Work as our priority. We strengthened the Fair Consideration Framework (FCF) and stiffened penalties for employers with discriminatory practices, whether for age or gender bias or for not giving qualified Singaporeans serious consideration for jobs.
23. The COVID-19 outbreak has only strengthened our resolve. In these challenging times, it is all the more critical to give our people the assurance of fair recruitment. Even as we work on opening up more pathways to jobs, we will continue to uphold the FCF as a commitment to our people.