Budget debate: NTUC aims to roll out wage ladders in food services, retail sectors in 2 to 3 years

This will nearly double the coverage of the model.
This will nearly double the coverage of the model.ST PHOTO: KELVIN CHNG

SINGAPORE - The labour movement hopes to implement the progressive wage model (PWM) for the food services and retail sectors in the next two to three years, to boost the earnings of about 70,000 low-wage workers.

This will nearly double the coverage of the model, which is currently mandatory in the outsourced sectors of cleaning, security and landscape maintenance, and covers about 80,000 workers.

The National Trades Union Congress (NTUC) also wants to roll out the PWM in the near future to the strata management, pest management and solar technology sectors, said deputy secretary-general Koh Poh Koon.

The PWM could potentially benefit 5,000 workers in strata management and up to 3,000 workers in pest management, said Dr Koh during the Budget debate on Wednesday (Feb 24). He did not provide an estimate for the number of workers in solar technology.

While most workers in the strata management sector are not low-wage earners, a PWM will ensure better wage progression and prospects for them, Dr Koh said.

"This is because their wages can remain quite stagnant due to the outsourcing nature of this particular industry," he added.

Discussions on developing a PWM in the solar technology sector has started, while talks with the pest management sector will begin this year.

NTUC aims to submit a proposal on a PWM for the pest management sector to the Ministry of Manpower by mid-2021.

Dr Koh also urged the Government and employers to consider implementing a "vocational PWM" for lower-wage occupations that cut across multiple sectors, such as clerks and logistics drivers, through the skills frameworks that are already in place.

The labour movement's calls to speed up the expansion of the PWM echoed that of its chief, Mr Ng Chee Meng, who laid out NTUC's priorities for 2021 last Thursday.

Introduced in 2012, the PWM is a wage ladder that sets out the minimum monthly salary for local low-wage workers. To increase their wages, workers have to undergo structured training to improve their skills and productivity.

The model will become mandatory in the lift and escalator maintenance sector next year and benefit up to 2,400 workers, while a PWM for the waste management sector is in the works to benefit up to 3,000 workers.

On Wednesday, Dr Koh noted that the PWM, which was first mooted by NTUC, has led to cumulative wage growth of around 30 per cent in the cleaning, security and landscaping maintenance sectors over the last five years. This is compared against 24 per cent in wage growth for workers at the bottom 20 per cent of wages in the same period.

But the wage gap between workers at the bottom 20th percentile and the median income level can be narrowed further by enhancing the existing PWM through two ways, he said.

First, in-house cleaners and security officers should be included under the mandatory PWM, which covers only outsourced workers.

This should be done "as soon as possible because the framework and the mechanisms are already there", he added.

He also called for greater range of salary increases for low-wage workers over the next five to 10 years, so that these workers can close the wage gap with those earning median salaries in their respective sectors.

"Our sisters and brothers in the bottom 20 per cent should not become a social underclass," said Dr Koh.

"A progressive wage is not about charity. A progressive wage is about recognising the dignity of our workers through their work. It's about paying a fair wage and ensuring that the wages of those in the bottom 20 per cent keep pace with the rest of society," he said.

Dr Koh also suggested repurposing the Wage Credit Scheme to support companies as they transition to implement the PWM in the new sectors - especially small- and medium-sized enterprises that have been affected by the economic impact of Covid-19.

This was also suggested by labour MP Mohd Fahmi Aliman (Marine Parade GRC), who noted that as the wages of essential workers are increased, consumers may have to pay more for their services as companies pass on higher costs.

To guard against companies that try to profiteer from increasing the prices of their services, a tripartite committee can be set up to investigate such allegations, Dr Koh proposed.

Nominated MP Abdul Samad Abdul Wahab, who is vice-president of NTUC, said expanding the PWM to more sectors will provide a "useful roadmap to attract fresh graduates, mid-career switchers, develop and retain locals ".


Wage improvements in the works

Waste management
• The Tripartite Cluster for Waste Management was formed last month to develop and implement a progressive wage model (PWM) for this sector.

• To benefit up to 3,000 workers.

Food services
• First mooted in 2018. The National Trades Union Congress (NTUC) aims to implement a PWM in the next two to three years.

• To benefit more than 36,000 workers.

Retail
• NTUC currently engaging businesses and industry on near-term plans; hopes to implement a PWM in the next two to three years.

• To benefit more than 34,000 workers.

Strata management
• To benefit more than 5,000 workers.

Pest management
• Discussions to begin with relevant agency on key milestones for this year to implement PWM.

• To benefit more than 3,000 workers.

Solar technology
• NTUC starting discussions with relevant association to adapt the industry’s Career Development Plan for a PWM.