Since 2012, the move to uplift the basic income of low-wage workers has been one of the National Wages Council's (NWC) major efforts. Continuing this work, NWC this year recommended to push up basic wage threshold to $1,200 to benefit more low-income workers.
The increase is from the $1,100 previously set in 2015. The number of workers earning $1,100 and below was 5.7 per cent as of 2016, down from 8.2 per cent the previous year.
The council has also recommended that employers provide a $45 to $60 increase for workers earning a basic wage of up to $1,200.
For two consecutive years, NWC has recommended a range instead of a fixed amount in light of the uneven labour market and business conditions.
In an announcement on 31 May 2017, NWC said: “The judicious increase in the wage threshold in 2015 to $1,100 has helped to maintain momentum of the effort [to raise the skills and incomes of low-wage workers] … Therefore, NWC believes that there is merit to continue to provide quantitative guidelines for low-wage workers and to raise the basic wage threshold further.”
For low-wage workers earning more than a basic of $1,200, NWC recommended that employers grant a reasonable wage increase or a one-off lump sum based on their skills and productivity.
Business Performance
Meanwhile, the Report on Wage Practices 2016 showed that the proportion of firms that were profitable declined from 79 per cent in 2015 to 76 per cent in 2016. Given the uncertain economic outlook, NWC urged employers to increase workers’ wages sustainably, fairly and in line with its business prospects.
As uneven business conditions and restructuring continue to loom over Singapore, NWC this year also urged businesses and workers to deepen skills and transform jobs to increase productivity and remain future-ready.
As part of the recommendations, tripartite partners were urged to press on with transforming industries through Industry Transformation Maps, employers were encouraged to tap on available support schemes such as the Transform and Grow initiative and workers were urged to take advantage of the future economy by keeping their skills up to date.
These recommendations are in line with those of the Committee on the Future Economy (CFE) released earlier this year.
The Government has accepted the NWC guidelines, which will take effect for one year from 1 July 2017.
NTUC’s Response
NTUC Tripartism Director Melvin Yong, who is also a committee member at NWC, said he was heartened to see support from tripartite partners to increase the basic wage threshold to help benefit more low-wage workers.
“Given the uncertain economic forecast and the uneven performance across the industry sectors, the tripartite team had a challenging task coming up with a set of guidelines that can balance the needs of the employers and all our workers, taking into account business conditions, labour market performance, productivity growth and economic outlook.
“Aligning with the recommendations by CFE, I am glad that the latest NWC guidelines continue to pay special attention to those who are earning lower wages, contract workers and matured workers,” he said.
Mr Yong added that NTUC will continue to work with tripartite partners, unions, professional associations and SME partners to push for higher adoption of the guidelines.
