Payslip rule weighs heavily on SMEs, many worry it will add to costs

Seven out of 10 firms worry rules would add to costs and manpower

THE tiny payslip is creating a storm among the small and medium-sized enterprises (SMEs) here.

While the authorities are insisting that firms issue the flimsy salary note to their workers, some employers are not keen.

At a closed-door dialogue last month, the Ministry of Manpower (MOM) told SME bosses that they have to comply with the rule from next year. The requirement was first announced in March without a commencement date.

"The meeting got some (firms) worried because we will not be able to meet MOM's requirement to itemise the payslip," a source told The Straits Times.

Seven out of 10 SMEs interviewed are worried that the move will add to business costs and manpower shortage woes.

Although nine said that they already issue monthly payslips to their workers, some noted that these are just simple stubs which show basic information such as the salary and Central Provident Fund (CPF) deduction.

Experts said a good payslip should include breakdowns such as basic salary, overtime pay, allowances, bonuses as well as deductions like CPF contributions and approved donations.

Mr Teo Ah, honorary secretary of the Singapore School and Private Hire Bus Owners' Association, said bus owners who hire ad hoc drivers will have problems.

"These are not permanent employees and they are paid daily on the day they finish work, so it is administratively difficult to give them payslips," he said.

Payroll software costs above $3,000, but firms can tap government grants.

Other business owners grumbled about the need for a salary note in the first place, especially if workers are family members.

"They are helping out and not really workers, so I do not give them payslips," said an Ang Mo Kio coffee shop owner who declined to be named.

But such laissez-faire acts are frowned upon by analysts.

Mr David Leong, managing director of recruitment firm PeopleWorldwide Consulting, said it is a good human resource practice to issue payslips.

"Without payslips, workers will not know how their pay is calculated, so their welfare will not be protected."

The MOM pointed out that there was wide public support for making payslips compulsory in a public consultation drive last year, and the ministry understands the worries of small firms.

"We will allow some time for them to adjust," said a spokesman.

"The MOM is in the midst of working with stakeholders... and others to assist companies, especially smaller firms, with compliance."

Government Parliamentary Committee for Manpower chairman Zainudin Nordin said employers who do not issue payslips should re-examine themselves.

"Some may have forgotten that they were once workers too. When they were workers, how would they have felt if their bosses did not issue payslips?"

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