Singapore Employment Act changes to benefit more workers
However, some MPs fear they could add to local companies’ business costs
By CHUANG PECK MING
DESPITE the economic downturn, Parliament yesterday gave the green light for changes to the Employment Act, which some MPs fear could add to the cost burden of companies in Singapore.
Mr Gan: Imperative to get fundamentals right in employment framework
‘There are areas in the proposed amendments which I feel could be introduced at a more opportune time than now, when businesses and industries are scrambling to keep themselves afloat amid this financial storm,’ Lim Wee Kiak (Sembawang GRC) said during the debate on the Employment (Amendment) Bill.
‘Employers have faced many cost increases in the past two years, including wage inflation, extension of the skills development levy to include all workers, an increase in medical insurance premiums for workers, rent increase, raw material increase, transport cost increase, utility bill increases and many more,’ he said. ‘It seems to me that the amendment in this Act will further increase the business cost to our enterprises and erode our competitiveness.’
Among the changes that concern Dr Lim: the Act will cover more employees, including confidential staff; there will be a new salary threshold for workmen and a higher salary threshold for non-workmen, and a shorter qualifying period for paid sick leave.
Tabling the changes, which were first unveiled in September, Acting Manpower Minister Gan Kim Yong said that it is understandable that employers may be concerned about the impact on business costs. But the amendments will benefit mainly lower-wage and vulnerable workers ‘who will feel the bite of the economic downturn most keenly’.
‘Moreover, many of the changes, such as the extension of public holidays and sick leave benefits to all employees, are already industry norms and should not significantly increase business costs,’ he said.
Mr Gan said that it is ‘imperative that we set the fundamentals right in our employment framework so that our labour force will remain responsive and productive, so that we will be well-positioned for when the economy recovers’.
He said that the Singapore National Employers Federation and Singapore Business Federation were both ‘closely consulted’ about the changes, and employers generally accepted that they are good in the long term.
Last amended in 1995, the Employment Act has been in need of updating, Mr Gan said. More people are now employed in services; professionals, managers, executives and technicians form almost half of the work force; contract workers have increased and wages have increased.
‘In light of these changes, it is timely to update the Employment Act to ensure it remains relevant and responsive to the changing labour market conditions,’ he said. ‘Employment protection and benefits for certain groups of vulnerable workers need to be enhanced. Employment standards also need to be revised to better reflect employment norms while maintaining labour market flexibility.’
The changes, which take effect from Jan 1 next year, will extend the Act’s coverage of employees, update employment standards and perks, and boost penalties and enforcement powers.
Source : Business Times - 19 Nov 2008
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