Employers must inform MOM if cost-cutting moves have affected workers' salaries

Manpower Minister Josephine Teo urged companies to make use of wage and training support measures that the Government has rolled out to help employers.
Manpower Minister Josephine Teo urged companies to make use of wage and training support measures that the Government has rolled out to help employers.ST PHOTO: KUA CHEE SIONG

SINGAPORE - Employers must notify the Ministry of Manpower (MOM) if cost-cutting measures taken during the current slowdown have affected workers’ salaries, and indicate that they have done so fairly.

This requirement, which is part of an update yesterday to the tripartite advisory on managing excess manpower and responsible retrenchment, kicks in on Thursday (March 12). 

“This is to encourage a sense of social responsibility and prevent downstream salary disputes,” said Manpower Minister Josephine Teo on Tuesday (March 10).

The notifications will also allow MOM to monitor the scope and scale of such measures, and whether more government interventions are needed, she said. 

The move comes at a time when businesses in some sectors have suffered sharp declines in volume and revenue due to the ongoing coronavirus outbreak. Some firms have thus started to implement cost-saving measures.

Speaking at a dialogue with the Singapore National Employers Federation and the Singapore Business Federation, Mrs Teo added that the revised advisory recommends that employers send workers for training and upgrading before cutting headcount. 

 
 
 
 

Other changes to the advisory include the introduction of time-banking.

Time-banking allows employees to be “paid now for work later”. Mrs Teo noted that some companies might choose to shorten the work day or week because of fewer customers, which meant that workers would put in fewer hours.

“But the workers will still need incomes... What if the hours they did not work could be ‘banked’ today (by putting the unworked hours) into a personal account, which the employer can draw on for future overtime hours?” she suggested.

Citing SembCorp Marine Contractors as an example, Mrs Teo said that the work intensity for welders, fitters and general workers could be unpredictable due to weather conditions, tides and the availability of yard facilities.

“As such there are times when some workers have extended hours while others have little to do,” she said, adding that the time-banking formula is agreed upon based on established principles of overtime pay to be fair to employees.

Mrs Teo also urged companies to make use of wage and training support measures that the Government has rolled out to help employers. 
These include wage credits and allowing employers in the manufacturing and service sectors to transfer work-permit holders from mainland China to other employers who are short on staff.

Mrs Teo said: “For the next few months at least, MOM will focus on preventing large-scale job losses. This is not a shift away from promoting job and wage growth in the medium to longer term."