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Speech by Senior Minister of State for Manpower Mr Zaqy Mohamad at Committee of Supply 2023

Mr Zaqy Mohamad, Senior Minister of State for Manpower

A. Introduction 

A1. Mr Chairman, earlier, Minister for Manpower outlined how MOM will strengthen our efforts to uplift lower-wage workers and improve workplace safety.

A2. In my speech, I will elaborate on:
a. Tripartite progress in implementing Progressive Wage measures;
b. Measures to further support and uplift lower-wage workers; and
c. Heightened Safety Period measures to strengthen Workplace Safety and Health.

A3. I will also elaborate on our efforts in strengthening HR capabilities to support businesses, workforce and workplace transformation.

B. Uplifting Lower-Wage Workers with Tripartite Partners

(i) PWM Progress Update 

B1. Our tripartite journey to uplift lower-wage workers through Progressive Wages started more than 10 years ago with the first Progressive Wage Model (PWM) in the Cleaning sector in 2012. PWMs and other tripartite efforts have borne fruit.

a. Last year, real incomes of lower-wage workers grew by 4.7%, faster than the median worker at 2.0%. This means that as costs of living rose, the incomes of lower-wage workers rose even more. More importantly, we are narrowing the income gap between lower-wage workers and the median worker. We will continue our efforts to support lower-wage workers so that they achieve stronger wage outcomes.

B2. 2023 is a milestone year in our journey of uplifting lower-wage workers. We will see all recommendations of the Tripartite Workgroup on Lower-Wage Workers fully implemented by July. This follows the implementation of various PWMs, the Local Qualifying Salary requirement, and Progressive Wage Mark – last September, and in March this year.

B3. Allow me to update on the progress that tripartite partners have made.

a. With your permission, Mr Chairman, may I ask the Clerks to distribute a handout detailing our efforts to support our lower-wage workers. Members may also access the handout through the SG Parl MP mobile app.

b. Last September, we implemented the new Local Qualifying Salary, or LQS, requirement for all firms that employ foreign workers to pay their local workers at least the LQS.

c. At the same time, we also introduced the Retail PWM, and extended existing Cleaning, Security and Landscape PWMs to in-house workers.

d. In January, we launched the Progressive Wage Mark accreditation scheme.

e. Starting from today, we embark on another milestone - the Food Services PWM and Occupational Progressive Wages for Administrators and Drivers will come into effect.

f. With implementation of the Waste Management PWM this July, the suite of Progressive Wage moves will benefit up to 9 in 10 of our full-time lower-wage workers.

g. Workers covered by Sectoral Progressive Wages will see cumulative wage increases of up to 80% or more, by 2028.

h. PWMs will continue to set the pace for wage increases for lower-wage workers. Amidst a tight labour market, lower-wage workers who are not directly covered by Progressive Wages should still see meaningful wage increases, as employers will have to adjust according to market forces to attract and retain workers.

(ii) PWM Compliance and Enforcement 

B4. With almost all PWMs implemented, our attention is now focused on ensuring that employers understand the requirements and comply with them.
a. Employers must pay workers the right PWM wage based on the PWM job role. 

b. We recognise that the PWM requirements are new for many employers, and employers need time to understand them and make necessary HR or operational changes to comply. 

c. Hence, for new PWMs implemented since last September, MOM allowed a run-in period of 6 months, where we invested time to educate employers and workers on the requirements.

d. After the run-in period, employers who are found to be non-compliant may face suspension of their Work Pass privileges.

e. Some Members such as Mr Raj Joshua Thomas and Mr Mohd Fahmi Aliman asked how PWM might affect employers’ manpower deployment or workforce restructuring plans.

i. Tripartite partners recognise that employers may need to adjust manpower deployment plans or their workforce structure, based on their operating environment. However, when there is a need to make adjustments, employers should act in accordance with well-established tripartite advisories, such as the Tripartite Advisory on Managing Excess Manpower.

ii. Employers should engage and discuss with unions and employees, and reach an agreement before implementing any measures.  

iii. Most importantly, employers should also pay special attention to minimise the impact of any measure on lower-wage workers. These principles should be adhered to, with or without PWM.

(iii) PW Mark 

B5. I thank employers for working closely with the Government and the Labour Movement thus far on this important endeavour of uplifting our lower-wage workers. I also agree with Ms Yeo Wan Ling and Mr Xie Yao Quan, that consumers and service buyers also play an important role in our whole-of-society effort to support and uplift lower-wage workers.

a. In January, the Government launched the Progressive Wage Mark, or PW Mark, to help consumers and service buyers more easily identify firms that are paying Progressive Wages and support them.

b. Employers who also adopt the Tripartite Standard on Advancing Well-Being of Lower-Wage Workers will be accredited with the PW Mark Plus. These are employers who not only pay Progressive Wages, but also implement other measures that support lower-wage workers, such as providing rest areas.

c. Since applications opened last December, about 2,000 companies have received the PW Mark.

d. The Government will take the lead in this effort and help further the adoption of the PW Mark. For new tenders called from today onwards, the Government will require eligible suppliers and subcontractors to be accredited with the PW Mark, for the duration of the contract period. From 1 March next year, we will extend this requirement to quotations as well. This will cover the slew of tenders and quotations procured by the Government. 

e. Uplifting lower-wage workers is our collective responsibility as a society. I strongly encourage employers to do their part by paying Progressive Wages, and apply for the PW Mark or PW Mark Plus.

f. Consumers and service buyers can show their support and solidarity with lower-wage workers by purchasing from PW Mark-accredited companies.

(iv) PWCS Enhancements 

B6. The PWMs have set strong wage growth targets, on average of about 8% year-on-year. To support wage growth of our lower-wage workers, while balancing the uncertain economic conditions facing employers, we will continue to provide strong support to employers in adjusting to Progressive Wage measures.

a. Last year, the Government introduced the Progressive Wage Credit Scheme, or PWCS to help employers adjust to the new Progressive Wage and LQS requirements, and other voluntary wage increases for lower-wage workers.

b. DPM announced at Budget that the Government will increase our PWCS co-funding share for wage increases given in 2023. Similar to the enhancement made last year, the Government will co-fund up to 75% of wage increases for eligible lower-wage workers, including those not covered by our Progressive Wage moves. 

c. All in all, these PWCS enhancements will offset a significant proportion of immediate cost pressures on employers arising from our efforts to uplift lower-wage workers, and mitigate cost transfer to consumers.

d. I urge employers to take the opportunity to accelerate their business transformation plans, so that we can improve productivity, upskill workers, and ensure that we can continue to close the income gap sustainably over the long term.

(v) WSS Enhancements 

B7. Workfare is one of the key pillars of Government’s support for our lower-wage workers. The Workfare Skills Support Scheme, or WSS, is an important scheme that supports the upskilling of lower-wage workers, to improve their employability and earnings.

a. Under WSS, employers who send lower-wage workers for training receive an Absentee Payroll subsidy of 95% of their workers’ basic hourly wage.

b. Employees who self-sponsor their training will receive a Training Allowance, which offsets their opportunity costs of training.

c. WSS has been successful in supporting lower-wage workers in achieving more impactful employment outcomes. This is why we will be enhancing WSS from July this year.

d. To allow more lower-wage workers to benefit from WSS and upskill earlier in their careers, we will lower the eligibility age for WSS from 35 to 30 years old.

e. Additionally, workers earning up to $2,500 a month will now be able to qualify for WSS, up from the current qualifying income cap of $2,300.

f. With these enhancements, 70,000 more lower-wage workers will be eligible for WSS.

g. In addition, as lower-wage workers who achieve Full Qualifications through WSS are more likely to earn higher wages, we will raise the Training Commitment Award for Full Qualifications from $500 to $800, to encourage lower-wage workers to undertake deeper and more sustained training.

(vi) Recap of WIS Enhancements 

B8. Last year, the Government announced significant enhancements to the Workfare Income Supplement Scheme, or WIS, which have taken effect from January 2023.

a. The enhancements increased coverage by extending Workfare to those aged 30 to 34 years, from 35 years and older previously, as well as raising the qualifying monthly income cap to $2,500, from $2,300 previously.

b. In addition, Workfare payments have been increased to up to $4,200 per year, from up to $4,000 previously. All persons with disabilities will also qualify for the highest Workfare payment tier of up to $4,200, regardless of age.

c. With these enhancements, over half a million lower-wage workers will benefit from payments amounting to $1.1 billion, up from $850 million previously.

d. Collectively, PW moves, WSS and WIS strengthen support for our lower-wage workers.

C. Ensuring Safety in the Workplace 

(i) Recap of Government’s Efforts 

C1. Moving on to Workplace Safety and Health (WSH), Mr Pritam Singh and Mr Melvin Yong asked about the Government’s efforts to reduce workplace fatalities and injuries, and instilling a stronger safe operations culture.

C2. In 2022, MOM introduced various measures to address the spate of workplace fatalities.

a. We ended 2022 with a total of 46 workplace fatalities and a fatality rate of 1.3 per 100,000 workers, which was higher than pre-Covid of 1.1 in 2019 and 1.2 in 2018.

b. The number of workplace fatalities would have been higher without the implementation of the Heightened Safety Period (HSP) measures last September.

c. Average number of fatalities per month reduced from 4.5 in January to August 2022, before HSP, to 2.5 in September to December 2022 during HSP. 2.5 average fatalities per month brings the annualised fatality rate to 0.8 per 100,000, which is below our WSH2028 target of 1.0, and much lower compared to 1.5 pre-HSP. This suggests that the industry can keep the fatality numbers low if we put our hearts and minds to it.

C3. We also monitor major injuries closely as these reflect persistent safety lapses and have debilitating effects. The average monthly major injuries worsened from 49.1 before HSP to 55.3 during HSP.

C4. We found that the impact of HSP was uneven across sectors.

a. Although the monthly average fatal and major injuries in the Construction sector showed the most improvement, the monthly average fatal and major injuries worsened for the Manufacturing sector. For Transportation and Storage, monthly average fatal injuries remained the same, while major injuries worsened. This suggests that more targeted sectoral measures are needed.

(ii) Implementation of Additional Measures 

C5. As part of our HSP measures, we stood up the Multi-Agency Workplace Safety Taskforce, which comprises lead agencies of the sectors that contributed most of the fatal and major injuries. This aims to study additional broad-based and sectoral measures that should be implemented, by looking into the different risk profile and impact of HSP in each sector. We also convened the International Advisory Panel on WSH in Jan 2023, and MOM and our sector agency partners will take into account their recommendations. 

a. With effect from today, MOM has extended the HSP by three months, till 31 May 2023, to drive further WSH improvement and maintain vigilance.

C6. It is important for corporate senior leadership to take charge and be accountable for WSH. Their influence and control over workplace resources and priorities drive the safety culture of their organisations. Under the WSH Act, they are liable for ensuring their workers’ safety and health. 

C7. The Approved Code of Practice for Company Directors’ WSH Duties gazetted in last October provides practical guidance on how they may fulfil their legal WSH obligations.  

a. As part of the HSP extension, MOM introduced additional measures to strengthen WSH ownership among company leaders. CEOs or Board of Directors of companies found to have serious WSH lapses following serious workplace incidents, have to attend a mandatory half-day in-person WSH training course. MOM will also increase the maximum fines to deter errant WSH behaviour. 

b. To strengthen the WSH ecosystem, we will launch a campaign to encourage and empower workers to speak up on WSH concerns and raise awareness on the protections for workers who whistle-blow.

c. To address Mr Leon Pereira’s query on protection for whistleblowers, under the WSH act today, Employers cannot dismiss or threaten employees who whistleblow. MOM will take actions against employers who do so.
C8. To Mr Melvin Yong’s query, HSP was a useful wake-up call to all employers and workers to be extra vigilant.  But it cannot continue indefinitely. What we do need to do is to strengthen WSH standards and practices in a sustainable manner for the long-term.

a. This is why we are considering deeper reforms, both broad-based and sectoral measures as part of the Multi-Agency Workplace Safety Taskforce. We will announce these measures when ready. 

C9. The improvements seen during HSP demonstrate that safer workplaces are possible. As Mr Christopher de Souza and Dr Wan Rizal said, everyone must play our part to uplift WSH, so that our workers can have the peace of mind that they will return home safely to their loved ones.

a. Starting with the top management, Company Directors and CEOs must set the culture of their organisations where safety consciousness is integrated in all its operations, and provide a safe work environment with appropriate and adequate training for their workers, supported by supervisors and safety professionals. 

b. Workers themselves are responsible for following safe work procedures to ensure their own safety and that of others in the workplace. They should report all unsafe practices to their supervisors, and if their concerns are not addressed, they should alert MOM or their union representatives, and we will take action.

c. Union leaders should join company management for walkabouts to strengthen top management’s commitment to their workers. 

d. Members of the public can also be our “eyes on the ground”, by reporting unsafe practices to MOM. For example, reporting workers who are working at height without safety harnesses in your neighbourhood, via MOM’s website or hotline, or the QR Code found on project signboards. MOM will follow up on these reports and take errant employers or workers to task. 

C10. MOM will continue to work with companies, industry associations and workers to build a stronger WSH culture. Together, we can get back on track with our WSH 2028 mission to reduce the fatal injury rate to below 1.0 per 100,000 workers and join just four countries in the OECD that have achieved this fatal injury rate.

D. Right to Sit for Service Staff 

D1. Beyond workplace safety, promoting physical health at workplaces is also important.  Mr Leon Perera asked about service staff having the right to sit. 

a. The Employment Act establishes some rules on working hours to protect employees’ well-being. For example, employees covered under Part 4 of the Act should have at least one rest break for every six consecutive hours of work.

b. Besides legislation, the Government also promotes the provision of proper rest areas for employees.

c. We are mindful of the wide range of work settings, for which it will not be appropriate to impose excessive and overly prescriptive regulations.

d. We are open to discussing with tripartite partners on possible tripartite guidance on best practices for employers.

D2. We encourage all employers to provide adequate rest and welfare for all staff, including service staff, and tap on the Workcare Grant should they require support to do so. It is only right for employers to provide their staff with a conducive work environment. Staff will also be more motivated and engaged as a result.

E. Strengthening HR Capabilities 

E1. Let me also share our efforts to strengthen HR capabilities.

a. Post-pandemic, a strong HR is a critical enabler of business and workforce transformation.

b. From helping businesses attract the right talent to implementing fair and inclusive employment practices, HR will play an integral role.

c. We will do more to support and build up the capabilities of our HR workforce.

E2. The Institute for HR Professionals, or IHRP, is a tripartite organisation that supports the professional development of aspiring and existing HR practitioners.

a. I would like to assure Mr Patrick Tay that the IHRP certification framework is robust, as it ensures that HR professionals have the right mindset and knowledge on manpower regulations including fair employment practices, labour management system and existing Tripartite Guidelines.

E3. All certified HR professionals join a vibrant community which provides access to an extensive professional network and resources.

a. One example is the IHRP playbooks. These playbooks are developed with master or senior HR professionals to provide the community with curated best practices and tools that they can adopt in their organisations to respond to workforce challenges.

b. To date, IHRP has produced 7 playbooks, covering important issues such as the emergence of hybrid workplaces, digital transformation, and promotion of mental well-being.

c. We encourage firms and company HR leaders to adopt them.

E4. The community of IHRP-certified professionals has tripled since 2020 and is now over 6,500 strong. This suggests that businesses and HR professionals see value in certification.

a. While we echo Mr Patrick Tay’s call to have more HR professionals certified, we have no plans to make IHRP certification mandatory at this point.

b. We are mindful of imposing regulatory costs on businesses. Besides, good HR practices apply to all companies, regardless of whether they hire foreign manpower.

c. Nevertheless, I agree with the Member that besides HR, People Managers also play a critical role in supporting good human capital practices.  To this end, MOM will work with IHRP and its partners on the suggestion to better equip People Managers with requisite HR knowledge and progressive practices. 

E5. Besides IHRP certification, we agree with Mr Edward Chia that the HR professionals also need to continually update their skills and hone their expertise.

a. Continuous professional development is a key part of being a certified HR professional.

b. HR professionals can take up IHRP skills badges in emerging areas such as strategic workforce planning and talent management.

c. IHRP has been appointed by SkillsFuture Singapore as a Skills Development Partner (SDP). MOM is working with IHRP to more responsively identify skills gaps, and develop skills-based credentialling pathways for HR.

E6. Professionalising our HR workforce and equipping them with relevant skills and mindsets is necessary but insufficient in itself.

a. Enterprises must make use of these highly-skilled HR professionals to transform their HR capabilities.

b. To this end, Mr Edward Chia will be pleased to know that MOM will be launching a 5-year HR Industry Transformation Plan. This will set out a roadmap for MOM to work together with sector agencies, industry and unions to spur HR transformation and build a future-ready HR workforce. More details will be released later. 

F. Vernacular Speech (Malay) 

F1. Mr Chairman, allow me to recap some of MOM’s efforts in Malay.

(i) Meningkatkan Taraf Pekerja Bergaji Rendah 

F2. Seperti yang dinyatakan oleh Menteri Tenaga Manusia, Pemerintah komited untuk memastikan dasar-dasar tenaga kerja kita menyediakan lebih banyak peluang untuk semua.

F3. Membantu pekerja bergaji rendah memang sentiasa menjadi salah satu keutamaan MOM. Sejak Model Gaji Progresif, atau PWM, mula diperkenalkan lebih 10 tahun yang lalu, ia telah memberi sumbangan besar dalam meningkatkan gaji dan menyokong kehidupan pekerja bergaji rendah.

a. Menjelang Julai tahun ini, kami akan memperluaskan langkah Gaji Progresif untuk meliputi sehingga 9 daripada 10 pekerja bergaji rendah. Ini bukan sahaja meliputi pekerja dalam sektor Pembersihan, Keselamatan, Landskap serta Penyenggaraan Lif dan Tangga Bergerak, bahkan juga sektor-sektor baru seperti Perkhidmatan Makanan, Runcit, Pengurusan Sisa, dan pekerjaan seperti Pentadbir dan Pemandu.

b. Para pekerja dalam sektor-sektor ini akan menikmati kenaikan gaji yang bermakna dan diberikan peluang-peluang latihan serta perkembangan laluan kerjaya.

c. Dengan ini, pekerja yang dilindungi oleh Gaji Progresif Sektoral akan menyaksikan kenaikan gaji terkumpul sehingga 80% atau lebih, menjelang 2028. Sebagai contoh, kita boleh menjangkakan pekerja pembersihan mendapat sekurang-kurangnya $2,420 menjelang 2028, dan begitu juga pegawai keselamatan $3,530 menjelang 2028.

d. Semua pekerja setempat lain yang bekerja dengan syarikat-syarikat yang menggaji pekerja asing juga akan dibayar sekurang-kurangnya LQS sebanyak $1,400.

e. Pada keseluruhannya, langkah-langkah ini akan menyokong matlamat kita untuk merapatkan lagi jurang gaji antara pekerja bergaji rendah dan pertengahan.

F4. Pada masa yang sama, para pekerja mesti memainkan peranan mereka untuk mengikuti latihan dan peningkatan kemahiran.

G. Conclusion 

G1. The Government is committed to strengthening the support of lower-wage workers, and partnering employers to improve workplace safety.

a. We must all do our part for a more inclusive and cohesive society, where everyone enjoys the fruits of growth, and no worker is left behind as Singapore progresses.

b. Society must also continue to appreciate and respect workers in all trades.