Government will co-fund transfer of foreign expertise; Employment Act widened

THE good news for employers is they will soon get funding support from government to speed up the transfer of foreign expertise to local workers - and they can keep foreign workers on their payroll longer.

The bad news is the entitlements they provide workers under the Employment Act - such as hours of work and overtime pay, sick leave, annual leave and maternity leave - will have to be provided to more workers with the government's move to drop the salary cap on employees covered under the Act.

The support and changes come with the move by the Ministry of Manpower (MOM) to create better local-foreign workforce synergy and extend additional protection to more workers.

Manpower Minister Lim Swee Say disclosed during the Budget debate on Monday that his ministry is prepared to pick up at least 30 per cent - up to a maximum of 90 per cent on a case by case basis - of the tab for hiring foreign specialists who can pass on needed expertise to local workers through on-the-job training or working alongside locals. This also includes sending local trainers overseas to acquire the expertise.

The government support, made through the Capability Transfer Programme, covers salary, cost of living allowance, airfare and equipment. It is capped at S$300,000 per project, but Mr Lim said it is prepared to give more on a case by case basis.

The MOM will also extend the maximum period of employment for Work Permit Holders (WPHs) by four years in all sectors from May 1, 2018. The extension is intended to encourage employers to retain their trained and experienced WPHs to raise overall workforce productivity.

This means WPHs from China can work in construction, process and marine shipyards for up to 26 years. WPHs from Non Traditional Sources can work up to 14 years. The period of employment for Chinese WPHs working in the services and manufacturing sector will be increased from 18 to 22 years.

From Sept 1, WPHs in the manufacturing and marine shipyard sectors can also be upgraded to R1 status if they meet the minimum period of employment and salary requirements through the Market-Based Skills Recognition Framework. The minimum period of employment and salary requirements is four years and S$1,600 monthly for the manufacturing sector, and two years and S$1,200 monthly for marine shipyards.

Currently WPHs in the manufacturing and marine shipyard sectors are recognised as higher skilled (R1) through qualifications and skills tests.

"The additional pathway supplements the existing upgrading pathways to encourage hiring and retention of more experienced workers to improve productivity," the MOM said. "It also brings the manufacturing and marine shipyard sectors in line with the construction, process and service sectors, where more experienced workers who command higher wages are already recognised as higher skilled (R1) workers."

Mr Lim also said that the MOM will update the S Pass pay criteria to keep pace with rising local wages, maintain the quality of the foreign workforce and boost its complementarity to the local workforce. Thus the minimum qualifying salary for S Pass will be raised from S$2200 to S$2400 in two steps - from S$2200 to S$2300 from January 2, 2019; and from S$2300 to S$2400 from January 1, 2020.

On the Employment Act, MOM said it would amend the labour law to also cover all managers and executives without salary cap. The salary threshold for non-workmen, such as clerical staff, will be raised from S$2,500 to S$2,600 to cover the vulnerable half of the workforce.

With the revision, the Employment Claims Tribunal (ECT) will also hear wrongful dismissal claims as one-stop avenue for workers and employers. Currently, salary-related disputes are heard by the ECT, while wrongful dismissal claims are heard by the Minister for Manpower.

"As dismissal-related claims are usually coupled with salary issues, the affected employee has to go to two different parties for their issues to be resolved," MOM said.