IN A move that reflects the growing severity of the economic crisis, the National Wages Council has taken the unusual move of reconvening next month to revise a set of wage guidelines it issued in May this year.

In a statement issued on Tuesday, the NWC said that it will reconvene in January to review its May wage guidelines that were to cover the period from July this year to June next year.

The NWC had recommended, among other things, a one-off bonus for low-wage workers to cope with inflation and moderate wage increases that were in line with company performance.

The recommendations were made when the economy was expected to grow between 4 to 6 per cent and at a time where there was high inflation, said the NWC.

But latest figures show that the economy is expected to grow just 2.5 per cent this year, and is expected to dip into negative territory next year, it added.

As such, NWC chairman Lim Pin said: 'Given the weakening economic situation, there is a need for the NWC to take stock of the new situation and review its May Guidelines to help companies and workers manage the downturn.'

It is not the first time the NWC is revising its guidelines.

In 1998, during the Asian Financial Crisis, the NWC had also reconvened to recommend wage cuts of between 5 to 8 per cent to deal with the crisis.

In Dec 2001, the NWC also revised its own guidelines issued earlier that year, in the aftermath of the Sept 11 terror attacks in America.

It urged companies at the time to retrench as a last resort and said companies may initiate wage freezes or cuts to deal with the downturn.

The NWC recommendations are closely watched by the public and private sectors as they set the direction for wage policies.

The NWC is expected to release its new set of guidelines in middle of January.