Employers urged to avoid axing workers

They should tap enhanced Jobs Support Scheme payout to pay local employees' salaries: MOM

An almost deserted Raffles City mall at around 5.30pm yesterday. Most workplaces - aside from those offering essential services and in key sectors - are closed until May 4 to break the chain of Covid-19 transmission.
An almost deserted Raffles City mall at around 5.30pm yesterday. Most workplaces - aside from those offering essential services and in key sectors - are closed until May 4 to break the chain of Covid-19 transmission.ST PHOTO: JASON QUAH

Employers are strongly urged not to resort to retrenchment or prolonged no-pay leave to manage business costs during the circuit breaker month, said the Ministry of Manpower (MOM) in an advisory this week on salary and leave arrangements.

They should tap the enhanced Jobs Support Scheme payout for this month to pay local workers their salaries. "This will ensure that government subsidies go directly to the local employees and that they are assured of a baseline wage, including the corresponding CPF contributions," said the ministry.

Most workplaces - aside from those offering essential services and in key sectors - are closed from Tuesday until May 4 to break the chain of Covid-19 transmission. Firms that can operate remotely have been encouraged to do so.

The MOM noted that some firms severely affected by Covid-19 may have already taken cost-saving measures before the circuit breaker period. They should review whether they can use the additional Jobs Support Scheme funding for this month to better help employees and minimise hardship to them.

The scheme was enhanced on Monday to cover 75 per cent of all local employees' wages this month, up to the salary ceiling of $4,600, as part of supplementary budget measures to save firms and jobs amid the pandemic. The salary support is 25 per cent for another eight months, with higher subsidies of 50 per cent for those in food services and 75 per cent for those in tourism and aviation.

Employers will receive the higher support for April this month, as part of the first of three payouts. Each payout is for three months of wages.

Local and foreign employees who continue to work full time during the circuit breaker month must be paid their prevailing salaries, including employer Central Provident Fund (CPF) contributions, said the MOM on Monday in its advisory.

This includes those working in essential services, whose workplaces can stay open, as well as those in non-essential services who are working from home.

For local employees who are not assigned work during this period, employers should use all the enhanced Jobs Support Scheme payout for this month to give them a baseline pay and CPF contributions.

If they are given work to do at home but are not working full time, those earning up to $4,600 should be paid their prevailing salaries and CPF contributions.

For those earning more than $4,600, the employer should use all of the Jobs Support Scheme payout to give them a baseline pay and CPF contributions, and also pay for work done on a pro rata basis.

If workers' salaries are still below their usual level before the circuit breaker period even after these measures, employers should try other ways to make up for the shortfall, such as sending the workers for training courses eligible for absentee payroll funding from the Government, or granting them additional paid leave.

 
 
 

They could also apply to the MOM to use a flexible work schedule or time banking, where staff are paid now even though they do less work, but put in extra hours later on.

Employers who have agreed to salary arrangements that are more generous than what is in the advisory should continue with those arrangements, said the ministry, which consulted employer and union representatives in coming up with the recommendations.

As for foreign workers who cannot work during this period, the MOM said employers must continue to look after their maintenance and upkeep, and work out salary and leave arrangements with the workers and their unions, especially for low-wage work permit holders. They can ask workers to use their paid leave, or apply for time banking.

The MOM suggested that a work permit holder staying at a purpose-built dormitory drawing a monthly basic pay of $600 should be paid $450 as salary and to cover food and accommodation even if there is no work for him.

 
A version of this article appeared in the print edition of The Straits Times on April 09, 2020, with the headline 'Employers urged to avoid axing workers'. Print Edition | Subscribe