Model ID: 6dbb9041-af1a-4209-9493-2446b07f4d95
Sitecore Context Id: 6dbb9041-af1a-4209-9493-2446b07f4d95;
Introduction
Mr Speaker, I rise in support of this Bill, which seeks to raise the retirement age and re-employment age in Singapore to 65 years and 70 years respectively by 2030. The first move is to commence from 1 July 2022, increasing the retirement and re-employment ages to 63 and 68 respectively.
The Need for Re-Employment
The Retirement and Re-employment Act (the “Act”) came into force in 2012, because of three (3) main factors, namely, (1) a longer life expectancy of the current population; (2) a tightening labour market with a shrinking citizen population; and (3) the need for talent management and retention.
Today, the abovementioned needs continue to exist, and underscore the importance of the Act. Although COVID-19 has challenged the labour market, the Tripartite Partners agree that “the important work to enable older employees to continue working if they are able and willing to do so, must continue.”
EAP as an easy way out of Companies’ Re-employment Obligations
While I am heartened that the Tripartite Partners remain committed to supporting the re-employment of older workers, I am concerned of more companies not re-employing existing older workers in view of the uneven and uncertain outlook.
I know of some companies who have resorted to making pay-outs under the Employment Assistance Payment (the “EAP”), as an easy and cost-efficient way of circumventing their re-employment obligations. Indeed, this situation is in some way, exacerbated by the COVID-19 pandemic.
As the life expectancy of individuals increase over the years, together with the mounting pressures on the sandwich generation, it is crucial that we ensure that all older workers who are keen and able to work, can continue to do so, with reasonable adjustments to their re-employment terms. Accordingly, the EAP should not be used as an easy way out to avoid re-employing older workers. Instead, it should only be offered after a thorough review, as a last resort – if the employer cannot find any internal vacancy.
To that end, I would like to raise 6 suggestions for consideration.
Review the EAP payable, with a view to increasing the sum payable
First, with the increase in median wages and the cost of living in Singapore, it is submitted that the existing one-off payment equivalent to 3.5 months’ salary, subject to a minimum of S$5,500 and maximum of S$13,000 needs to be reviewed and increased.
If there is a sizable increase in the minimum and maximum EAP payable, this might serve to deter companies from cursorily reviewing internal vacancies with a view to let go of mature workers. Companies may have a greater incentive to find suitable internal vacancies for older workers to work at and be paid for.
If push comes to shove, and employers genuinely have no other options but to let go of older workers, at least the increased EAP amount would serve to tide them through a longer period of unemployment. We need to ensure that the EAP sum provided is sufficient – we do not want our older workers to be living from hand to mouth.
I therefore submit that the Tripartite Partners continue to work at and review the mutually agreed increment in both the minimum and maximum EAP sums, to cater to the increased median wages, changing employment landscape, and increased cost of living in Singapore.
Unemployment income support and benefits
Second, additional tiers of unemployment income support for PMEs who are involuntarily unemployed.
The findings of the NTUC-SNEF PME Taskforce Report (the “PME Taskforce Report”) show that mature PMEs are particularly precarious when retrenched during the current downturn due to (i) higher costs of living as they provide for both older and younger dependents (ii) longer time periods taken to find a new job in view of their age and lack of relevant skillsets; and (iii) increased propensity to suffer from wage loss on re-entry to employment.
PMEs shared that an unemployment income support could provide some breathing space for them to retrain, upgrade their skills and look for suitable employment, while helping to alleviate their anxieties, and ensure that those who are unaware of avenues of help do not fall through the cracks.
I therefore suggest that the Government consider an unemployment income support coupled with active labour market policies for all workers (including mature PMEs) who are involuntarily unemployed, and for the Tripartite Partners to study this carefully in greater detail.
Providing short term salary support for companies
Third, the PME Taskforce Report also found that despite being active in their job search and undergoing training, mature PMEs who were retrenched had difficulties in securing a job.
To assist mature PMEs, the Government could consider providing a short-term salary support (up to 50% salary funding, capped at S$3,800 per month for 6 months) for companies who hire mature PMEs who are unemployed to lower the cost and risk for companies to hire this group of PMEs with relevant skills.
If a new company takes on another company’s re-employment obligations, the short-term salary support from the Government would be particularly useful in easing its re-employment obligations with respect to the mature worker transferred.
Require employers to state in writing their reasons for material changes to re-employment contracts and/or not re-employing older workers
Fourth, while the current framework provides flexibility in job negotiations for re-employed employees, we need to safeguard against companies’ exploitations of such flexibilities.
Bearing in mind that older workers have performed satisfactorily and been employed in that role over the years, we could require employers to justify in writing, inter alia, (a) any material changes in the re-employment terms of older workers and/or (b) sudden lack of internal vacancies for that said role, when these employees have been employed in that role over the years.
This is to avoid a situation whereby companies unilaterally offer significant pay cuts or reduction of employment benefits to the mature worker, under the guise of having renegotiated the employment terms with the mature worker, while expecting the same standards and deliverables from the mature worker.
Further, with the requirement for written justifications on material changes to the employment terms or sudden lack of internal vacancies, the company bears the burden of justifying that such changes are reasonable. The company cannot simply state that the employee rejected its reasonable re-employment offer, as a basis for not paying EAP.
Training and upgrading older workers
Fifth, even as we embrace digital transformation, we urge employers to continue training and upgrading older staff to acquire the necessary skills to minimise the digital and tech inequality. Where there are incentives and support schemes, to tap on these support schemes, and send older workers for training and skills upgrading.
Re-examine and re-design jobs
Lastly, through the COVID-19 pandemic, we have seen many changes in the work environment. Just to name a few – businesses have pivoted to online platforms, employees have been working from home, and international conferences are held online. These non-exhaustive lists of examples show us collectively that Singaporeans are agile enough to adapt to various changes and curveballs that the pandemic has thrown at us.
As Singapore marches towards the “next normal”, I would like to encourage employers to consider how various jobs can be re-designed and re-examined, to allow for older workers to continue working.
In so doing, companies may consider the relevant skill sets the employees have, and their experiences gleaned over the years, to match any needs that the business may have. For instance, if a person was employed in a marketing role, a job redesign could involve not just marketing work to external parties, but possibly internal communications, usage of digital platforms and social media, and/or pitching of ideas to senior management. Crucially, older workers may also take on the role of mentoring younger employees.
Conclusion
I would like to call on employers not to view older workers as “slow”, “backward” or “expensive to hire”. Instead, I urge employers to adopt a change in mindset. There is a Chinese saying, “家有一老，如有一宝”. This is loosely translated to mean that having an elder at home can be likened to having a treasure at home.
I believe this is also applicable in the work context too. Older employees have amassed a wealth of experience over the years in their specialised areas of work, and it would be our loss if we do not tap on this treasure while still available. There is something about decades of work experience, tenacity, soft skills, and accumulated knowledge that cannot be quantified, much less deemed as irrelevant for the purposes of re-employment.
Sir, I am confident that the Bill will aid our mature workers. Notwithstanding my suggestions, I stand in support of the Bill.
