Singapore's Employment Claims Tribunal is a step in right direction

A manager's employment has been terminated suddenly without notice by his firm. The firm claims that the summary termination was justified and the manager is, therefore, not entitled to three months' salary in lieu of notice.

The manager takes his salary dispute to the Ministry of Manpower's (MOM) Commissioner for Labour, but is turned away because professionals, managers and executives (PMEs) earning more than $4,500 a month and who have a salary dispute with their employers are limited to seeking recourse through the courts.

The manager now faces an unpleasant choice between forgoing the unpaid salary, or commencing court proceedings, which can be protracted and might not be cost effective unless the disputed sum is substantial.

It is, therefore, a very welcome development that Singapore's proposed Employment Claims Tribunal looks set to be operational in the first quarter of this year.

The tribunal aims to expand the avenue for dispute resolution to all employees, particularly PMEs, by providing an expeditious and cost- effective way of resolving salary disputes with their employers.


This is significant because 30.1 per cent of Singapore's resident workforce in 2014 were PMEs.

So far, what is known about the tribunal is that it will hear salary-related claims, which are subject to a claims limit that is yet to be announced.

A higher "claims cap" will apply to cases which have undergone a formal mediation process. As for the tribunal adjudicators, the aim is for them to have a strong appreciation of the employment and industrial relations landscape here.

In such disputes, the key concerns are the cost and time involved to enforce tribunal orders through the usual judicial enforcement processes. MOM is working with the Law Ministry to mitigate those concerns.

However, there are other key issues that need to be addressed.

The first concerns the jurisdiction of the new tribunal. It remains to be seen if its jurisdiction will extend beyond salary disputes to include unfair dismissal, employment discrimination and workplace harassment complaints.

Also uncertain is whether an employee can choose between the tribunal and the courts, and when that choice has to be made. The wider the tribunal's jurisdictional scope, the more significant its development and impact on Singapore employment law.

The second concerns the claims limit. If the limit is set too low, many PMEs might find themselves no better off than in the current situation, where they have no choice but to turn to the courts for redress. Imposing a claims limit suggests that the tribunal is not meant to replace the court system, but only supplement it, since higher claims will still need to be heard in court.

The third issue is whether parties that go before the tribunal can be represented by lawyers.

It is not clear how formal the tribunal process will be. Will it take the cue from proceedings before the Commissioner of Labour, where lawyers are not allowed to represent parties? This is meant to keep proceedings informal, allowing the commissioner to act "according to equity, good conscience and the merits of the case without regard to technicalities", as set out in the Employment Act.

Or will it be a more legalistic process with codified rules? Keeping it informal will allow the tribunal to handle cases faster, potentially allowing more people to benefit from it.

A fourth issue concerns the role of mediation. The tribunal allows a higher claims limit for parties that tried to settle their disputes by mediation first. This can encourage parties to explore mediation as a first recourse, although it may lengthen the dispute-resolution process.

The final issue concerns the appeals process. The Employment Act allows a party who is dissatisfied with the commissioner's decision to appeal that decision to the Singapore High Court.

Appeals from the commissioner to the High Court are currently few and far between. Even allowing for the likely increase in hearings by the tribunal, there might not be a surge of appeals to the High Court. Hence, there does not appear to be an immediate need to create a separate appellate body, as in Britain.

The tribunal marks an interesting development in the resolution of employment disputes in Singapore.

The provision of a speedy and cost-effective avenue for employees, including PMEs, to resolve salary and perhaps other disputes with employers is a step in the right direction.

•Mohammed Reza is director and Shaun Lee is supervising associate at JWS Asia Law Corporation.

A version of this article appeared in the print edition of The Straits Times on January 09, 2016, with the headline 'Singapore's Employment Claims Tribunal is a step in right direction'. Print Edition | Subscribe