Singapore Employment Act set for massive review

The legislation could be amended to raise wages and ensure good jobs and better financial security for Singaporeans.

The Employment Act, which governs basic employment terms and conditions in Singapore, was last reviewed in 2008. Since then the labor force is becoming more educated and more involved in the global economy, which the Ministry of State Tan Chuan-Jin said led to a need for a review.

The Ministry of Manpower will lead the government review.

"The best protection that we can give comes from providing Singaporeans with good jobs," said Minister Chuan-Jin. "We need to ensure that Singapore remains an attractive place for business. Why is this important? It is only when businesses come here, when our own businesses stay here, and thrive that we are able to create jobs and good jobs for our people. They create jobs both directly when businesses are here, and indirectly because there are also businesses that exist and grow to support them in turn."

"We also want to raise the quality of our existing jobs, by ensuring that Singaporean workers are treated fairly and responsibly. We do so in several ways: first we must ensure that our legislative framework remains relevant, and updated; second, we must make sure that employers keep to their bargain. So what this means is that they adhere to our employment laws – this is about compliance and enforcement; and third, we also need to encourage good HR practices where our employers can be responsible stewards of their workforce," he said..

"There is a need to ensure the EA keeps up with the times as there are changes in employment practices and employment landscape. First of all, the character of our labour force is changing. Singaporeans are becoming more educated. We are seeing more Professional, Managers and Executives (PMEs) in our workforce. Today, PMEs form about 32% of our resident workforce, up from 27% in 2001. We can expect this proportion to increase," said Minister Chuan-Jin.

"At the same time, employment norms and practices are also evolving. Today, we see a lot more outsourcing that is taking place. As a result of that, there are changes to work arrangements, so we have short-term contracts, for example, emerging over the years. Thus, we need to look at the EA in the context of these changes. As we are looking at improving the wage conditions for our low wage workers, we should also look at how the EA can better look after workers where the relationship with employers is less than balanced," he added.

"In order to achieve inclusive growth, good jobs must come with decent pay. We must grow the incomes of all Singaporeans, particularly those at the lower end, so that all Singaporeans can enjoy a better quality of life both for themselves and their families," he said. "We have done reasonably well - real median income gains averaged about 2.0% per annum in the last five years from 2006 to 2011. In comparison, income levels in many other countries have largely stagnated or even declined. And this increase is not just confined to the middle and upper segments, but it has also been quite pronounced in the lower end as well."

"But we are rightfully unhappy with the levels of our low wage earners. We have said this before. Some of the wages earned in the cleaning services sector are not acceptable. We intend to address this robustly but we need to do so sensibly so that we do not adversely tilt our economy over. That can happen, and when that happens, it affects all Singapore workers," he said.

"Let us tread carefully. Economic restructuring does not come just by raising wages alone. It requires a range of reforms and initiatives to boost productivity, and to increase the quality of our workforce, for example, through our extensive efforts in CET, and to make sure we move up the value-chain in the goods and services that we produce, and the jobs that we create," he said further.