SINGAPORE - 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 April 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 (Central Provident Fund) contributions," said the ministry.
Most workplaces - aside from those offering essential services and in key sectors - are closed from April 7 until May 4 to break the chain of transmission of the coronavirus. Firms that can operate remotely have been encouraged to do so.
MOM noted that some firms which have been 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 April to better help employees and minimise hardship to them.
The Jobs Support 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 Covid-19 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 and the next payouts will be in July and October.
The payout for April wages will be calculated based on October 2019 wages first, and the second and third payouts will be adjusted accordingly to account for any difference between employees' wages in the two months.
Local and foreign employees who continue to work full-time during the "circuit breaker" month must be paid their prevailing salaries, including employer CPF contributions, said the Ministry of Manpower (MOM) on Monday night (April 6) 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 April 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 in addition 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 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, 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.
"Employers must treat their foreign employees fairly and responsibly taking into consideration the levy waiver and rebate," said the ministry.
Foreign worker levies will be waived in April, and employers will also get a one-off levy rebate of $750 for each work permit or S Pass holder, to be paid out as early as April 21.
MOM suggested that a work permit holder staying at a purpose-built dormitory who had been drawing a basic pay of $600 per month should be paid $450 as salary and to cover food and accommodation even if there is no work for him, though he would forgo work-related allowances such as transport and shift allowances of $400 per month.
It also said that firms with at least 10 workers that implement cost-saving measures in the circuit breaker period must notify the ministry if the measures cause more than a 25 per cent reduction in their employees' pay.