Why It Matters

Timely review of Employment Act

More professionals, managers and executives (PMEs) could be given protection from employment woes under an ongoing review of Singapore's main labour law.

This is a welcome move, given that the group makes up a growing proportion of the workforce.

The Manpower Ministry (MOM) announced last week that it is reviewing the Employment Act, which sets out basic rights for workers.

The proposed changes include the removal of a salary cap for PMEs, which currently leaves those earning more than $4,500 a month without statutory protection from issues such as unfair dismissals and late payment of salaries.

Another is to adjust the salary thresholds for a portion of the Act which provides additional protection for certain groups of workers. Wages have risen in the six years since the Act was last reviewed, so it is timely to relook this area to ensure the number of workers protected does not shrink over time. At the same time, according higher paid workers more benefits could lead to higher costs for businesses. Employer groups have thus cautioned against making the labour market and employment practices too inflexible.

A balance must be struck between protecting workers and imposing excessive rigidity - if the business environment is not conducive for investments and business development, jobs will be affected as well.

Another area under review is a part of the Act that deals with dispute resolution.

MOM is considering making the claims process easier for workers and bosses by having both salary and wrongful dismissal cases heard by the same entity instead of separate ones.

In Singapore, irresponsible employers are not the norm. That said, the proposed changes to the Employment Act - if enacted - will reassure all workers that they have some protection should an unfortunate situation arise.

A version of this article appeared in the print edition of The Straits Times on January 25, 2018, with the headline 'Timely review of Employment Act'. Print Edition | Subscribe