More low-wage workers stand to benefit from the latest round of NWC recommendations announced on 31 May 2018.
Building on the progress made last year and ongoing tripartite efforts to raise the skills and incomes of low-wage workers, the NWC is recommending that the basic wage threshold be raised to $1,300. This increase is from the $1,200 set in 2017.
According to the Ministry of Manpower’s Comprehensive Labour Force Survey and Occupational Wage Survey, the number of workers earning $1,200 or less was 7.7 per cent as of 2017, down from 8.1 per cent in 2016.
The council also recommended that employers provide a $50-$70 dollar increase for workers earning a basic salary up to $1,300.
“With the pick-up in economic conditions and greater flexibility provided by the range, the adoption rate of the qualitative guidelines [by companies] has increased from 21 per cent in 2016 to 48 per cent in 2017. As economic prospects and business outlook continue to vary across firms and sectors, the NWC sees merit in continuing to set a range for the recommended wage increases,” said NWC in a statement.
The NWC recommended that employers grant a reasonable wage increase and/or a one-off lump sum to workers earning above $1,300, based on their skills and productivity.
The council also encouraged companies who have achieved productivity improvements in 2017 to provide an additional one-off special payment of between $300 to $600, either through single or progressive payments, to workers earning up to $1,300.
Workers in Outsourced Sectors
Recognising that some low-wage workers are employed in outsourced work, particularly in the cleaning, landscaping and security sectors, the NWC recommended that service providers factor in the annual salary adjustments and Annual Wage Supplement (AWS) for workers in new contracts.
In keeping with fair and progressive employment practices, the NWC asked that service buyers and service providers take into account the experience and performance of these workers when employment contracts are offered or renewed. This will help avoid the reset of wages and benefits for those who perform the same job functions and roles when service providers are changed.
The NWC also called for service buyers and service providers to work together on training opportunities and improving the employment terms for their outsourced employees.
Seizing Opportunities
With improvements in the economy, the labour market and stronger productivity growth in 2017, the NWC noted that the efforts made by the tripartite partners to operationalise the 23 Industry Transformation Maps. This will spur productivity and innovation so both businesses and workers can seize opportunities in the future economy and benefit from quality growth.
The council also encouraged businesses to work closely with sector agencies and unions to adopt skills frameworks to help their workers pick up new skills. At the same time, it highlighted the range of resources available through various initiatives such as SkillsFuture, Adapt & Grow programmes as well as learning platforms such as NTUC’s U Leap (Learning Enabled Through Active Participation).
Another resource for employers is the Agency for Productivity Practices, Human Resource and Industrial Relations (SAPPHIRE) under The Singapore National Employers’ Federation (SNEF). It supports employers with workplace transformation through digitalisation, progressive employment and human capital development.
Other Recommendations
The NWC also encouraged employers to adopt the Progressive Wage Model (PWM) as a means to help ensure that employees can enjoy sustainable and progressive wage increases and establish clear career pathways as they upskill and upgrade.
“PWMs, reinforced by skills upgrading and productivity improvement, will allow employers to make better use of manpower and pay higher wages, commensurate with their workers’ job scopes, responsibilities, skillsets and productivity levels,” said NWC in its announcement.
Other recommendations included looking at guidelines for matured workers and women looking to re-enter the workforce.
These included encouraging employers and the Government to explore age-friendly jobs and workplaces, train older workers to perform jobs more effectively and not use age as a hiring criteria.
It also called for employers to consider flexible working arrangements and family-friendly workplace practices to recruit, and retain back-to-work women as a valued source of manpower and talent.
NTUC’s Response
NTUC Tripartism Director Melvin Yong, who was council member of NWC, said he was heartened that adoption of the guidelines have improved.
“It is encouraging that employers have agreed to share the productivity gains with workers through a one-off special payment. We have proposed a range, either through a lump sum payment or several payments, to encourage small and medium-sized enterprises to adopt this practice as well.
“Now that all the Industry Transformation Maps have been launched, it is important for the tripartite partners to work closely to operationalise them; do more to spur productivity and innovation; and help workers upgrade their skillsets… Our employers must also take advantage of existing schemes to improve productivity, stay competitive and create better quality jobs for Singaporeans. Only then can real wage increases be sustained, in line with productivity over the long term,” he said.
These NWC guidelines will take effect for one year from 1 July 2018.
Read about the responses to the NWC guidelines by unionists here.
