National Wages Council issues guidelines for 2015/2016

Despite weak productivity growth over the past few years, the National Wages Council (NWC), in the release of its wage guidelines for 2015/2016, stressed the importance of focusing on skills to ignite productivity growth and sustain wage increases.

In the main, the NWC recommends employers give built-in wage increases to workers taking into account the firms' business performance, prospects, and sustainability. In addition, employers that do well should further reward employees with variable wage components in line with the firms' performance and workers' contributions.

For low-wage workers specifically, the NWC has recommended an increase in the wage threshold from S$1,000 to S$1,100. Its recommendations include:

- A built-in wage increase in the form of a dollar quantum and a percentage to give low-wage workers in the firm a higher percentage built-in wage increase.

- A built-in wage increase of at least S$60 for low-wage workers earning a basic monthly salary of up to S$1,100.

- An equitable and reasonable wage increase and/or lump sum based on skills and productivity for low-wage workers earning above S$1,100.

Separately, the NWC encouraged unions and employers to revisit the topic of portable medical coverage. With MediShield Life to be introduced in end-2015, it is a good time to work towards restructuring employer medical benefits to portable medical benefits to improve the cost-effectiveness of medical expenses, it said.

The NWC Guidelines cover the period from Jul 1 2015 to June 30 2016.

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