Efforts to uplift 283,000 lower-wage workers on 'accelerated timeline'
Progressive Wage Model to be extended to three new sectors - retail, food services and waste management
Singapore
EFFORTS to raise incomes of lower-wage workers will be redoubled in the next two years, as the Ministry of Manpower (MOM) looks to implement all 18 recommendations by a tripartite workgroup on an "accelerated" timeline.
The ministry is planning to expand the Progressive Wage Model (PWM) in two phases, while the Local Qualifying Salary (LQS) scheme will ensure all local employees of firms with foreign staff are paid at least S$1,400.
Currently, they only need to pay this amount to some local employees, depending on the number of foreigners they hire.
The model - introduced nine years ago and described as "minimum wage plus" by former Manpower Minister and current workgroup adviser Josephine Teo - currently covers 10 per cent of Singapore's lower wage workers in cleaning, security, landscaping and lift maintenance.
But the accelerated pace of implementation could see that figure ballooning to eight in 10 lower-wage workers within two years, potentially reaching 94 per cent of them with the launch of an accreditation scheme called Progressive Wage Mark (PW Mark).
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The remaining 6 per cent largely includes lower-wage workers in small businesses, such as heartland enterprises and minimarts, Manpower Minister Tan See Leng said.
He noted that many countries with minimum wage also exclude this group of family enterprises due to the "significant challenges" involved in applying the model to them.
The first phase begins on Sept 1 next year, with the rule change for the LQS and the roll out of PWM for the retail sector, while PWMs for the cleaning, security and landscape industries will also cover in-house workers, according to an MOM statement on Monday.
By March 1, 2023, the model will apply to food services workers, while occupational progressive wages will cover specific occupations across all sectors, beginning with administrators and drivers.
Meanwhile, the PW Mark, which recognises companies that pay progressive wages, will help inform corporate buyers and individual consumers who wish to support such firms.
The workgroup has also called for baseline progressive wage growth for workers at the 20th percentile to outpace median wage growth, so that they can gain ground with the median.
In addition, while wages should continue to keep pace with productivity growth, there should be scope for the wage growth of lower-wage workers to outpace productivity, according to the workgroup.
Mrs Teo, who is now Communications and Information Minister, told reporters that a "remarkable" tripartite consensus was reached despite the current economic uncertainty.
Workgroup chair and Senior Minister of State for Manpower Zaqy Mohamad said the workgroup has engaged over 1,800 people including union leaders, business leaders, academics, human resources professionals and lower-wage workers since it was convened in October last year.
Through the process, the unions are assured that the workers' interests are protected, while there has also been buy-in from employers to support the objectives, he said.
"The recommendations take our existing efforts to a new level - with steady and bold steps ahead - to build a more inclusive Singapore, so that our lower-wage workers can achieve progress through solidarity and dynamism," Mr Zaqy explained.
Dr Tan said the pandemic has shown how the PWM is "significantly superior" compared with a blunt minimum wage model, especially since certain sectors, such as hospitality and aviation, continue to see significant downside risks.
"Because of that, if you try to put up a minimum wage model and you expect these industries, which are going through very difficult times, to say that 'yes, we support this', I think it's going to be very, very, very difficult and a very tough act to follow, for many of them," he said.
Labour chief Ng Chee Meng said the journey has not ended yet, and the National Trades Union Congress will continue to lay the groundwork for further PWMs in new sectors and professions. "PWM is not only for the lower-wage workers but an institutional method to raise workers' wages in tandem with productivity growth in all different professions," he said.
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